2006 annual report, ukiah natural foods co-op

8/7/2019 2006 Annual Report, Ukiah Natural Foods Co-op

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UkiahNaturalFoodsC

o-op

721SouthStateStree

t

Ukiah,CA

95482

PRSRT-STDUSPostage

PAID

Petaluma,CA

PERMIT#16

April 2007 A publication of Ukiah Natural Foods Co-op, community-owned since 1976

We love good food...from the ground up!

ANNUALREPORT

2006

Our

CoreValuesIntegrity

CommunityInvolvement&Leadership

QualityFood&GoodsCustomerService

Prosperity

in review


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2006 Annual Report www.ukiahcoop.com 2

2006was another successful year for ourco-opit was also our 30th year inoperation! Our sales growth for the year was 13.20%, and we

managed to operate the store effi ciently and effectively in ourcongested facility. We ended 2006 with annual sales of $8.7million dollars, 67% of which were to our member-owners.We welcomed 672 new members to the Co-ops total member-ship of 5,912 and returned $260,438 to member-owners viadiscounts at the registers.

We employed 58 people of whom 39 were full time and 19part time. at amounted to $1,769,306 that we contributedto our local economy in wages and benefits. e Co-op fol-lows a livable wage model and, like co-ops across the country,

we are an example of responsible employment practices. We are continuing to grow and

maintain a cooperative business that provides a rewarding work environment. I appreci-ate and commend my staff for all of the time, effort and care that they contribute to theCo-op on a daily basis.

Yes, 2006 marked our 30th year anniversary and we celebrated it with a great outdoorfun-packed party for our member-owners and the community. Live music, samplingsfrom local vendors, a local farmers market, crafts and games for kids, and lots of greatprizes were just some of the attractions that contributed to the success of this celebration.It is really exciting to watch our co-op grow through all of the aches and pains that havetranspired over the past 30 years. e support from our little community has built thefoundation, stability, and community center that the Co-op represents.

Please read on for more details and highlights of 2006 in this annual report. Howproud I am to be part of a trusted, cooperative marketplace of goods and services thatprovides for the needs of our diverse community!

In Cooperation,Lori RosenbergGeneral Manager

1

Co-opPrinciple1:Voluntary&

OpenMembersh

ip

NewCo-op member-Owners

672 new households joinedthe Co-op in 2006!

5,912 households in ourcommunity were member-owners of the Co-op by

January 1, 2007.

Vision: We envision Ukiah Natural Foods Co-op to be the foundation of a trusted, cooperative

marketplace of goods and services that provides for the needs of our diverse community.

Purpose: The purpose of Ukiah Natural Foods Co-op is to be a vital, thriving, andgrowing community center that will:

Provide and promote organically grown, sustainably produced food, goods, and services that are

locally and regionally sourced whenever possible.

Promote the health and wellness of our community by providing facilities,

resources, and information and by offering effective, positive community

education and services.

Embody and model sustainable, humane, equitable, green ways of working and living,

creating and maintaining an ideal workplace.

Add to the enjoyment and enrichment of our greater community ventures and networks.

Have fun doing it!

A natural foods cooperativesince 1976

721 South State StreetUkiah, CA 95482

707-462-4778

www.ukiahcoop.com

email: [email protected]

Store HoursMonFri.....88 p.m.

Sat.....86 p.m.Sun...106 p.m.

UNF ManagementGeneral Manager

Lori Rosenberg

FinanceAnne Wright

Front EndRebecca Winter

GroceryBarbara Verenis

Human Resources & OperationsSusan Winter

ProduceLibby Uhuru

WellnessMike Tilander

GREETINGS FROMTHE GENERALMANAGER

Cheers to Another Great Year!


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3 www.ukiahcoop.com 2006 Annual Report

Produce broke records...Duringanksgiving week the department had its

highest sales ever, but the staff stillgracefully made sure we all had cranberries

& mushrooms for our feasts!

Wellness staff studied hard...Garden of Life sent Max & Traci to West Palm Beach

to learn about the companys high quality product lines,and staff had in-store trainings fromMegaFoods, Enzymaticerapy, and New Chapter.

Human Resources squeezed a f ew more staff in the building...Sales increased 13.2% over the previous year and so did our employees!

We started 2006 with 53 employees and ended with 60, a 13.2% increase.

Employee turnover was 48%, a fairly low figure for our industr y.Of those employees, 36 (60%) have been here for an entire year or longer.

5Co-opPrinciple5:

Education,Training&Information

CO-OPSWORK

Department Highlights from 2006

Grocerygot serious...At the close of 2006, the grocery aisles had

4,581 organic itemsthats57.4% of the products offered!

Espresso Bar expanded...You patiently waited for the Espresso

Bar to get remodeled so we could offerwheatgrass, veggie juices & smoothies.e drink menu continues to expandhave you tried the Almond Joy?

Front End welcomed a new manager...Co-op Front End veteran Becca Winter

became our Front End Manager and led thecashiers through record-high sales days.


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4

Co-opPrinciple4:Autonomy&Indepen

dence

The Co-opis an

independent,thriving

community-owned

business withno corporate

ownership.And its

financiallystrong!

by Anne WrightFinance Manager

The Co-op ended 2006 with sales of

$8,705,911! is is a 13.2% increaseover 2005 sales. is is also our second con-secutive year of slower sales growth, comparedto our 20% average sales growth that happenedbetween 1998 and 2004. We are projecting salesgrowth of 12% for 2007. e store averaged arecord-setting 836 customers per day and organ-ic food sales rose to 69% of total food sales.

e cost of goods sold was 63.6% of sales. Af-ter deducting member-owner discounts we have

a margin of 33.41% for store expenses.

Employee benefitsLabor is our largest expense after cost of goods.

e Co-op currently has 60 employees; the aver-age wage is $12.38 per hour. Employee benefitsinclude an 11% discount on purchases, healthinsurance, paid vacation and sick time, 401Kretirement account and profit sharing.

Total operating expenses of the store totaled27.08% of gross sales; 1.77% under projected

budget. After income tax expense, we have

a net profit of $348,713 or 4.01% of grosssales.

Balance sheetOur balance sheet shows a strong co-op

with assets far exceeding liabilities. Wecurrently have approximately 1.4 milliondollars set aside for our expansion project.After paying off our mortgage in 2005, wehave not incurred any other long-term debt.

Annual Gross Sales Comparison 20032006% Increase % Increase % Increase % Increase

2006 Over Prior 2005 Over Prior 2004 Over Prior 2003 Over Prior

Year Year Year Year

Grocery 2,647,647 13% 2,345,440 17% 1,980,309 -16% 2,364,476 19%

Non-foods 290,087 13% 262,189 2% 257,136 4% 248,163 10%

Produce 1,407,594 12% 1,254,400 17% 1,073,341 17% 919,101 18%

Liquor 181,488 29% 140,263 14% 122,915 26% 97,229 17%

Frozen 391,666 19% 320,992 5% 305,788 n/a n/a n/a

Gen Mrch 254,188 6% 238,875 23% 193,496 n/a n/a n/a

Cheese 279,529 10% 254,889 11% 228,657 n/a n/a n/a

Bulk 519,133 12% 463,993 16% 401,602 19% 338,434 14%

Herbs 67,710 14% 59,224 18% 50,306 14% 44,253 15%

Wellness 1,174,656 10% 1,070,799 7% 999,082 16% 864,199 17%Dairy 467,361 11% 420,193 11% 377,361 37% 276,230 28%

Bodycare 460,754 12% 411,894 11% 372,415 14% 327,988 7%

Housewares 97,688 -11% 109,856 18% 93,407 6% 88,292 -13%

Coffee 133,372 7% 124,339 2% 121,484 n/a n/a n/a

Espresso Bar 138,942 60% 86,960 26% 69,052 7% 64,354 216%

Food-to-go 188,340 44% 126,502 -23% 169,955 n/a n/a n/a

Yearly Sales $ $8,705,721 $7,690,807 $6,816,307 $5,632,719

Sales Increase % 13.20% 12.83% 21.01% 17.48%

FROMTHE ACCOUNTING DEPARTMENT

2006 Year-End Financial Report


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Owners equity in the Co-op increased to $2.5million, from a combination of share purchasesand retained earnings.

Expansion update?With sales of $1232 per square foot, we are

hoping that facility expansion will occur this year.We have spent much time and energy trying tofind a solution that is not in the 7 or 8 milliondollar range; although we are a financially strong

Co-op, we dont want to take on a debt load thatis equal to our annual sales. Stay tuned to thenewsletter in the next few months for updates onthe expansion issue.

Labor

Occupancy

Depreciation

MarketingGovernance Operations

Administrative

Labor $1,769,306Occupancy $146,948Depreciation $52,536

How was money spent in 2006?

Marketing $139,612Governance $30,329Operations $157,467Administrative $61,729

Income StatementYears Ended 12/31/06 & 12/31/05

SALES 8,705,911 7,690,807

COST OF GOODS SOLD 5,536,856 4,917,019

GROSS MARGIN 3,169,055 2,773,788

MEMBER DISCOUNTS 260,438 210,435

GROSS MARGIN STORE OPER. 2,908,616 2,563,354

EXPENSES

LABOR EXPENSE 1,769,306 1,598,597

OCCUPANCY E XPENSE 146,948 143,514

DEPRECIATION EXPENSE 52,536 60,485

MARKETING EXPENSE 139,612 119,074

GOVERNANCE EXPENSE 30,329 26,603

OPERATING EXPENSE 157,467 139,615

ADMINISTRATIVE EXPENSE 61,729 98,261

TOTAL OPERATING EXPENSES 2,357,926 2,186,148

NET SAVINGS FROM STORE OPER. 550,690 377,206

OTHER INCOME 48,219 15,600

OTHER EXPENSES 1,972 9,281

EARNINGS BEFORE INCOME TAX 596,938 383,524

INCOME TAX EXPENSE 248,225 148,025NET PROFIT (LOSS) 348,713 235,499

48,225348,713234,963361,975

ASSETS AT 12/31/06 AT 12/31/05

CURRENT ASSETS 2,401,567 1,783,622PROPERTY AND EQUIPMENT 522,841 550,861

OTHER ASSETS 38,637 34,829

TOTAL ASSETS 2,963,045 2,369,312

LIABILITIES

CURRENT LIABILITIES 407,838 257,360

LONG TERM LIABILITIES 0 0

LONG TERM MORTGAGE PAY. 0 0

MEMBERS EQUITY

MEMBER A & B SHARES 492,375 424,450

RETAINED EARNINGS 1,714,119 1,452,003

Y.T.D. NET SAVINGS (LOSS) 348,713 235,499

TOTAL LIABILITIES & MEMBERS EQUITY 2,963,045 2,369,312

Balance Sheet 2006 & 2005

407 838394,576

348,713361,975


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fun ways we met our neighbors in 20065

We got out and met people all over town.Perhaps you visited our table at the Farmers Market,La Buena Vida Health Fair, the Full Circle Wellness

Health Faire, or at one of the other community eventswe visited to share good food and make new friends.

Live music became a regularfeature in the store in2006. Bob Laughton& Kristine Robinplayed on the first dayof each new season& theyll continuethis lovely traditionin 2007.

Eat Local! Picnic got us out to Tom Palleys farm for arelaxing, sumptuous picnic of local foods prepared by JacquieLee. Live music from the Willits Farmers Market Band and a

tour of the farm rounded out this delicious day in Covelo. If you

missed out, watch for details about this years picnic in September.

Who grows our food..and wine andmedicine? We visited some of the folkswho bring over 2,000 local products to

the Co-ops shelves and reported onthem in the Co-op News. In 2006 ourlocal product sales were about 16% of

our total sales. In 2007 watch for specialevents and sales with the monthly

Featured Local Vendor program.

We threw a birthday partyto celebrate our 30th year in busi-

ness. Hundreds of you came & en-joyed the festivitiesso much that

were planning morecommunity events in 2007.


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Co-opPrinciple7:ConcernfortheCommunity

Where did the money come from in 2006?

1. Grocery $2,647,6472. Non-Foods $295,8213. Produce $1,407,5944. Wine & Beer $181,4895. Frozen $391,666

6. General Merch. $254,1887. Cheese $279,5298. Bulk $519,1339. Herbs $67,71010. Wellness $1,174,656

3

Co-opPrinciple3:MemberEconomicParticipation

Ever wonder how you& other shoppers arespending your moneyat the Co-op? Heresthe breakdown.

11. Dairy $467,36112. Bodycare $460,65413. Housewares $97,68814. Coffee $133,37215. Espresso Bar $138,94216. Food-to-go $188,340

Co-op Community Grantsawarded $30,000 in grant money to local nonprofit

groups working on nutrition, wellness, and housing.e Co-op Board is accepting applications for the

2007 grants until May 30. Applications available atukiahcoop.com & at Customer Service.

Monthly Donationswere given all year long. In 2006 this amounted to over $1,500to nonprofit groups to help with their events. Forty groups were

gifted last year, including the Human Race, SPACE, Willits FoodBank, the Humane Society, United Peace Relief,

Ukiah Skate Park, and Yoga Mendocino.

SupportWe were able to offer support to groups putting on

special events in the community. Last year, we aidedSundays in the Park, Pastels on the Plaza, and

the Waldorf Pumpkin Patch.Give Back to Schools Weekdonated $9,604 to local schoolsshoppers selected a

school & we donated a portion of their sale to that school.Watch for this fund-raiser in October 2007. School ad-ministrators, you can apply at ukiahcoop.com or get anapplication at Customer Service starting in September.

John Milder Scholarshipawarded a $2,500 scholarship to a Mendocino College ag stu-

dent. Students interested in applying for this annual scholarshipin 2007 should contact the college financial aid department.

CO-OPSWORK

Co-op Programs Gave Back to the Community in 2006


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Looking Ahead to 2007Calendar Highlights...

A festive tradition at the Co-op, Appreciation Days are

scheduled all year long in 2007. This year, were putting

a special emphasis on sales just for member-

owners. Dates are tentative, so watch in the store for details.

May 1719Member Appreciation: 6% extra off for owners

August 1618Customer Appreciation: 4% off for all

October 1820Member Appreciation: 6% extra off for owners

December 68Member Appreciation: 6% extra off for owners

6Co-op

Principle6:CooperationAmongCo-ops

Co-op Advantage Program (CAP)is our top-notch savings program that brings

monthly sales and quarterly coupon books to shoppers.

Cooperation among all co-ops nationwide

(by pooling our collective buying power!) makes thesegreat sales possible. In 2007, look for expanded

CAP offerings in Wellness.

2Co-op

Principle2:Democrat

ic

Member

Control

Get involvedin Co-op activities...

Perhaps 2006 is your year tojoin a Co-op committee? ere are small

groups working on donations & grants,education & outreach, elections &nominations, finance, and gover-

nance.To join or just find out more, go to

ukiahcoop.com or pick upan application atCustomer Service.

Appreciation Days

We love good foodand sharing all

the good food at the Co-op. Join us

for tasting events throughout the

year. Watch in the store or at

ukiahcoop.com for exact datesand times.

April 7: Good Food Fest!June: Wine & cheese

September: Eat local picnicOctober: Slow food tasting

November: Cheese samplingDecember: Holiday food tasting

Tasting Fairs

These sales were

so popular in

2006 that we will

continue to offer a

sale each month

on a unique group

of products

including the

entire produce

department in

September! Dates

may change, so

watch for details

in the store.

April 5 Wellness department 5% offMay 9 Chips & salsa 9% offJune 8 Wine & cheese 8% offJuly 6 Juice & sodas 6% offAugust 7 Bulk herbs 7% off

September 6 Produce 6% offOctober 10 Pasta & sauces 10% offNovember 9 Cheese & crackers 9% offDecember 12 Bulk foods 12% off

Category Sales

2006 annual report, ukiah natural foods co-op

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