Above: The building space at 407 4th Avenue has just been rented to two businesses, the Northwest Cooperative Development Center, and Pet Works. They will both move in by the end of the year.
By Janine Unsoeld
At long last, a key downtown building has new tenants – upstairs, the Northwest Cooperative Development Center (NWCDC), and downstairs, a pet food and supply company, The Pet Works.
The building at 407 4th Avenue next to Olympia’s popular artesian well is owned by Ray LaForge and Mike Lyons.
The former Union Pacific railroad depot building is perhaps best known as the former location of Alpine Experience and Olympic Outfitters, and most recently, Crossfit Olympia, which rented the space for eight months and then moved to nearby Cherry Street, just behind Olympia City Hall.
Reached late today, building co-owner Mike Lyons said that remodeling is set to begin today or tomorrow and continue through January. He also confirmed that The Pet Works, a company with two locations, one in Longview, Washington, and one in Astoria, Oregon, will move into the just under 10,000 square foot downstairs space on December 1.
According to their website, Pet Works was established in 1975 and is locally owned and operated, with over 50 years of experience in the pet industry.
The Northwest Cooperative Development Center (NWCDC) is expected to move into the 1,900 square foot upstairs space by early January.
The Northwest Cooperative Development Center (NWCDC)
The NWCDC is a nonprofit organization devoted to assisting new and existing cooperatives in such fields as daycare centers, credit unions, online food businesses, energy, and home health care.
Diane Gasaway, executive director of the NWCDC, is excited about the move in January. She signed the lease to rent out the upstairs of the building on 4th Avenue on Friday, October 11.
Gasaway says the move will more than double their current space at 1063 Capitol Way, which is quite cramped. They will provide desk space for Co-Fed, a college food co-operative, and anticipates the ability to rent out office space and a board room to community members when it doesn't interfere with their work.
The NWCDC is currently located in a building scheduled to be demolished by Washington State's Department of Enterprise Services. Current tenants of that building have until June 2014 to find new homes.
The NWCDC supports cooperatives in Oregon, Washington, Idaho and Hawaii. Founded by cooperatives in 1979, the Center has grown into the Northwest's leading provider of services for co-op business development. It has a long history of collaborating with communities, governments, economic development agencies and other cooperatives.
The NWCDC is funded in large part by federal grants received by the U.S. Department of Agriculture Rural Cooperative Development program, and other non-federal sources. The organization offers technical assistance services including feasibility assessments, cooperative education, business planning, strategic planning, market research, board training, and grant writing.
While it might sound cool to start a cooperatively-owned business, it requires, like any business, extensive planning, analysis, financing, capital investment, and marketing.
According to a 2011 list compiled by the National Cooperative Bank’s “NCB Co-op 100,” the top six revenue generating industries are agriculture, grocery and food distribution, energy and communications, finance, hardware and lumber, and healthcare. All combined, these businesses posted revenue totaling approximately $215.6 billion, an 11% increase from 2010. The top seven industries are in the fields of agriculture and grocery.
So what is a cooperative?
A cooperative is defined by the International Cooperative Alliance as any “autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise."
“We understand that when consumers, producers or workers become business owners of a cooperative, their individual and collective responsibilities greatly increase. New owners face significant challenges to organize, get started and stay on track with a new cooperative business,” said Gasaway.
Asked for the number one reason why businesses fail in their first year, Gasaway responded, without hesitation, “Failure to plan.”
To lighten a reality that can be daunting to many business newcomers who think their idea is the best thing since sliced bread, Gasaway added, “There’s a quote I just read in an industry magazine that roughly says, “The best thing about failing to plan is that failure comes as a surprise.”
Gasaway says a potential new business should make month by month planning assumptions for five years into the future. A feasibility study can be expensive, upwards of $100,000 or more, depending on several technical aspects, such as architectural needs, environmental impact surveys, and more.
Through grants, the NWCDC tries to help new businesses with these costs. She knows of a few potential businesses who, after doing a good, thorough feasibility study, decide that the high cost of starting up is just too great.
“Plenty of people with great ideas, at this point, get the wind taken out of their sails…a lot of good can come out of organizing even if you don’t launch a business, but we’re in the business of starting businesses,” said Gasaway, and offered several examples of their successes.
At any one time, the NWCDC has about 25 potential projects going, in various stages of development.
Northwest and South Sound Cooperatives
Well known Northwest cooperatives include REI, Inc., which now has a South Sound retail location at Westfield Capital Mall in Olympia; an agricultural co-op, Cenex Harvest States, and the Boeing Employees Credit Union. Leslye Tueber of REI, Inc. serves as an advisory board member to the NWCDC.
The South Sound area is home to several businesses and cooperatives, such as Group Health Cooperative, which ranked #13 on NCB’s Top 100 Co-op list in terms of revenue; Ace Hardware, a cooperative which ranked #10 , is operated as Hardels Ace Hardware on the westside of Olympia, and REI, Inc., which ranked #27 on the list.
Despite the name, grandfathered in years ago, the Olympia Food Co-op is not actually a co-operative – it is structured as a non-profit.
True to the national statistics, the areas of food, housing, and home health care are the fastest growing segments of the co-op industry for the NWCDC. The NWCDC helped the Ellensburg Food Co-op start and the Hidden Village Manufactured Housing Co-op start, both in 2011.
Another business, Olympia Local Foods, received assistance from the NWCDC and a grant from the U.S. Department of Agriculture’s Rural Development Program. Gasaway was present at the grand opening of Olympia Local Foods in April 2012, and gave remarks on the owner’s persistence and dedication to making his business a success.
Some local cooperatives have been helped by the NWCDC, the most recent being the New Moon Café, which became a cooperative in August.
Simon Gorbaty, a member of the New Moon Cooperative which runs a café in downtown Olympia, says the NWCDC helped the collective form a business plan, compile useful financial data, “and provide us with ways to improve our organizational structure.”
Cooperative Training Opportunities and Future
The NWCDC regularly provides networking and training opportunities through its “Cultivating NW Co-ops” conferences. The value of cooperatives to their communities and to each other was the theme of the NWCDC’s regional conference last year, which brought 130 participants from six states. The message was that cooperative businesses add value, not only in the sense of dollars but also in the value of the relationships that connect communities with cooperatives.
Last month, the NWCDC sponsored a conference called “Fresh Starts” that focused on the opportunities and challenges of starting and growing a food cooperative grocery. Gasaway gave the welcoming remarks to about 75 attendees representing about 12 cooperatives.
Asked if the South Sound could be in the market for a cooperative grocery, Gawaway said, "We don't want them to go into competition with other businesses but make sure their idea is serving a need that isn't being currently met....Starting a business is a big responsibility with big risks - we want to make sure communities are utilizing their resources to the best of their ability."
The Future of the NWCDC
Gasaway joined the NWCDC in 2003 and has 13 years of experience in the financial services industry. She received a Master of Public Administration with a co-op emphasis from The Evergreen State College and oversees five other employees, who all have experience with cooperatives in their professional and personal lives.
Staff member Eric Bowman provides cooperative development support and is board chair of the local Tulip Credit Union; Ben Dryfoos-Guss, NWCDC’s manufactured housing program manager, is on the board of the South of the South Community Land Trust.
Gasaway stays active in attending regional and national networking activities to hear other perspectives.
Recently, she heard Gar Alperovitz, a political economist, historian, and author of the book, “What Then Must We Do? Straight Talk About the Next American Revolution" speak when he came to the Northwest.
Aperovitz highlights, in his words, that a movement aiming at the “evolutionary reconstruction” of the American system—away from rampant inequality and corporate control, and towards a more just distribution of wealth and renewed democracy—is poised to take center stage in the national conversation.
Gasaway also recommended that people interested in cooperatives read, “Humanizing the Economy – Co-operatives in the Age of Capital,” by John Restakis.
“We’re a learning organization – I thought that after a few years I’d know it all, but the field is changing so fast and there’s still so much to know – there’s always something new. We’re excited about what’s happening all over the region and the country. There’s a real need for professionals in this field, from attorneys to accountants.”
Asked if funding for the NWCDC been affected by the recent federal shutdown, Gasaway said that they had a board discussion about it this week.
“We are submitting our reimbursements as usual, but they’ve been put on hold – our cash flow is okay for now, but in general, we’re looking for ways we can keep ourselves sustainable. The fact is, the USDA’s Rural Development program is one of the few funding sources that support cooperative development.
“Olympia is still considered rural, and as soon as one of our regional cities officially goes over a population of 50,000, that will no longer be the case. At this point, we’re constantly writing grants, which take a lot of time, and are competitive. We don’t know from year to year if we’ll be funded, so we’re trying to explore more options. There isn’t a lot of funding for urban work.”
If national co-operative statistics and local interest in co-operatives are any indication, no doubt, the NWCDC will continue to grow and expand.
For more information about the NWCDC, go to www.nwcdc.coop or call (360) 943-4241.
For information about Olympia Local Foods, go to the April 5, 2012 article “Olympia Local Foods Receives Grant to Fulfill Dream” at www.janineslittlehollywood.blogspot.com.
For information about the New Moon Cooperative, go to the South Sound Green Pages Summer 2013 edition at: www.oly-wa.us/greenpages and read “Cooperative Model” by Simon Gorbaty.
Above: The Northwest Co-operative Development Center (NWCDC) has been a tenant of 1063 Capitol Way, a building set to be demolished by the State, since 2005. The building is near the State Capitol Building, and across from TVW. A handful of tenants are in the building, including the State Department of Archeology and Preservation.