The calendar year has just finished up, and so we have an idea about how the year has gone in terms of finances. Our fiscal year doesn’t end until the end of February, but we can still compare calendar years and give a winter update on the Co-op’s social enterprise. Sales continued to grow at a healthy pace – almost 6% again this year (compared to 4% last year and 9% the year before) – and we finally broke the barrier of two million dollars in annual sales. This general number hides some important details though; after several years of double-digit growth in sales and customer counts, the cafe has shown a decline in customer counts of nearly 5%, whereas customer counts for the store have increased nearly as much.
Another figure, probably related, is that the summer was good but not a blockbuster; in fact, the two months showing the most sales growth this past year were November (12%) and December (17%). This is remarkable considering that last November and December (2018) were down slightly from the year before (2017); while we will always count on the summer to make money for the rest of the year, it’s highly encouraging to see sales improving so much in the winter.
While we’ve considered some local reasons why the store is on the upswing and the cafe is not, there is no obvious explanation. Instead, it may have to do with national and global factors. A recent survey by the Agri-Food Analytics Lab at Dalhousie University showed that 87% of Canadians agree that food prices are increasing faster than household income and that 53% intend to change food shopping habits in 2020. In order to save money on food, most Canadians said they would eat less often at restaurants – this would be an obvious explanation for why more people are shopping at the store instead of eating at the cafe. Other popular money-saving options include using coupons, looking for discounts, buying in bulk, and eating less meat. For more on this study, you can read this article from the Financial Post or read the survey results directly.
While the cafe has slowed down, it has still become an integral part of the Co-op. The cafe (food and drinks combined) makes up about 12% of total sales, and the bakery accounts for another 10% of all sales. This year, we started distinguishing between the cafe and the bakery because they are now physically separated. Now we keep track of their sales, ingredients costs, labour expenses, and other expenses separately so we know how each department is doing. We’re still working on the accounting details but, later this year, we can answer the perpetual questions: “is the cafe making money?” or “is the bakery making money?” Expect more articles on these questions in 2020!
Besides the cafe and bakery, we’re always watching the store departments as well. The produce department has shown the most growth for the past two years; it’s back to nearly 16% of all sales. Again this is encouraging because it had been in decline for a couple years and we consider making fresh, healthy fruit and vegetables available and affordable as a primary goal. Other departments on the rise include dairy, meat, and frozen foods. On the other hand, the bulk department has shown a significant decline over the past year and a half. We looked at pricing as a possible cause, but a comparison with other stores on Vancouver Island showed that we basically have the best pricing north of Nanaimo. We are now partnering with our primary bulk supplier – Left Coast Naturals – in order to improve the department. Look for new products, new signs, and new information coming soon.
We take continued growth at the Co-op as a sign that we’re fulfilling our mission; for us, more transactions means more satisfied customers and more sales means more money we can invest back into our community enterprise. It warms our hearts when the Food Bank decides to order their supplies using our pre-order system or when a member brings us a $3,000 cheque for their Co-op charge account. Thank you for your continued support in ways large and small.