FREQUENTLY ASKED QUESTIONS
What is a food co-op?
Food co-ops are especially awesome grocery stores! They provide products and services like many other grocery stores, but the business model and the guiding principles are different. A co-op exists to serve people, especially the members and the community. Co-op members are actually the owners of the store, and it is the owners who democratically choose the board of directors and help make other decisions that determine the path of the co-op.
This business model makes it possible to exist without the goal of rewarding outside investors. Instead, surplus revenue can be returned to owners in the form of patronage dividends, or it can be used to invest in the co-op to make it an even more awesome place for the owners and the community. Co-ops value people.
For over 30 years, food cooperatives have focused on providing their communities with high-quality, local, socially-responsible, organic and sustainably produced food.
For more information regarding co-ops, consider checking out the following sites:
Will the Co-op be like a buying club or a farmers’ market?
No, the co-op will be a brick-and-mortar grocery store open most, if not all, days of the week.
What makes co-ops different from other grocery stores?
There are many differences, but here is a start:
Co-ops are democratically controlled, and they exist to serve their members and the community, not make a profit. Co-ops are generally able to operate while following strong ethics and values. Plus, they can connect with some small, local farms that are unable to sell products at a larger grocery store!
What type of business organization is Hillsboro Food Co-op?
As of September 2013, Hillsboro Food Co-op is incorporated in Oregon as a cooperative business. Unlike most corporations, shareholders of the Co-op are community members who are investing in their community through grocery store ownership. Through the purchase a $200 member share, and individual becomes a Co-op member-owner. Member-owners have a say in the business decisions the Co-op makes both through voting in elections and by reaching out to the Board of Directors which is composed of elected member-owners who have volunteered to represent the whole body of member-owners. Additionally, the Co-op will return surplus revenue to its members in proportion to how much they use the Co-op through patronage dividends.
Is the Co-op a non-profit organization?
Hillsboro Food Co-op is incorporated in Oregon as a cooperative, which is considered a for-profit organization. Traditionally, co-ops return profits to member-owners in the form of patronage dividends, and thanks to tax code written especially for co-ops, neither the co-op nor the member-owners are taxed on this money. While the Co-op is technically for-profit, it is member-owned and democratically-controlled, and it has a strong mission to serve the community and world, just like a non-profit organization.
Where do profits go during profitable years?
Profits stay put in our community! Surplus revenue is returned to member-owners in proportion to how much they use the Co-op through patronage dividends. Due to the history of cooperatives in the United States, tax code has been written so that neither the co-op nor the member-owner is taxed on these funds.
When will the Co-op open?
That depends on YOU! Much of the timeline depends on people in the community joining the co-op. Join today and start recruiting your friends, family, neighbors, and coworkers!
Where will the Co-op be located?
The initial search for a store location will be in Downtown Hillsboro. We will search for locations within a 1-mile radius of the Civic Center. In keeping with our vision of providing an accessible grocery store, we will give strong preference to locations within ½-mile of a MAX station. If no feasible location can be found within these parameters during our search, the board will report to the member-owners and consider broadening the parameters.
What does it mean to be a member-owner of a co-op?
As a member-owner, you own a member share in the Hillsboro Food Co-op business. This means that in addition to getting the products and services you need, you also have a say in the business decisions the Co-op makes. Additionally, the Co-op will return surplus revenue to its members in proportion to how much they use the Co-op.
Who can be a member-owner?
Will I have to be a member-owner to shop at the Co-op?
No, but we will not be able to open without a sufficient member-owner base! Most co-ops aim for 1,000 member-owners prior to opening a brick and mortar store.
How much does a member share cost?
A full equity share is $200 for one individual. The membership can be used by all individuals in the household, but only the member who signed up is allowed to vote in elections. There are also monthly and quarterly payment plans, and you can be a member for as little as $20 each calendar quarter until the full $200 amount is paid.
What do I get for my membership?
A variety of things!
- A food co-op! The co-op exists to serve the needs of the membership, and it cannot open without a solid base of member-owners.
- The right to vote in Board elections and other ballots.
- A member-owner card. Temporary cards will be sent to member-owners until the store opens.
- A Hillsboro Food Co-op yard sign.
- Patronage dividends during profitable years.
Why does it cost so much to join?
While $200 may at first seem like a lot, it is this initial capital that provides the groundwork to open our grocery store, and it takes a lot of capital to open a grocery store! According to the Food Co-op Initiative, most start-ups are setting share prices between $200 and $300.
Also, did we mention… For $200, you OWN your grocery store!
What will my money be funding?
Opening the co-op! Your money will help us to pay for legal fees, marketing material, consulting services, permitting costs, equipment purchases, and the many other costs that come with opening a business. Remember that your membership is a contribution to the capital of the co-op. By pooling our money together, we are able to continue the start-up process and continually increase our attractiveness to investors, credit unions, and matching grant programs.
Can I get my money back?
Your member equity, up to $200, is recoverable should you choose to leave the co-op, to be paid out as laid out in the bylaws.
If the co-op is not successful and is forced to dissolve, all member capital will be redistributed, minus the money spent in the organizational process. For example, if we spent 25% of the overall member account balance, every member-owner would lose 25% of their total member equity contribution. The Board of Directors has committed to spending no more than 50% of the overall member account balance until passing the Feasibility Stage.
Do member-owners have any financial liability for the Co-op before or after the store is opened?
No. Member-owners are not be liable for the debts of the Co-op, beyond the amount invested in the Co-op through their member-owner share, or the amount owed by the member-owner for their share.
How do I become a member of the Co-op?
There are a few options to join the co-op. Join the co-op now!
I am not able to join, but I would like to donate to help out. Can I do that?
Yes! You can mail in a check to the address below. Please note that the Co-op is incorporated as a cooperative and not a non-profit, so donations are not tax deductible.
Hillsboro Food Co-op
P.O. Box 3953
Hillsboro, OR 97123