by Alex Gyori
Appreciation for BFC Shareholder Lenders
This past August, we invited BFC shareholders who had loaned funds to the Co-op for the Redevelopment Project to an informational meeting, repeated one week later, to present an update about when the Co-op would resume meeting its shareholder loan obligations.
As Food for Thought readers know, interest payments and maturing loan principal repayments were suspended in December of 2012 because revenue had failed to meet projections, negatively
impacting cash reserves. Almost half of the 165 shareholder lenders attended the meetings. Discussion was focused and supportive, good questions were asked and useful suggestions were voiced. Although details dealing with the loans may not be of interest to other shareholders, the presentation did
cover how the Co-op is doing.
Sales are growing
The graph pictured here picks up sales as of 2012, the last year of construction. The intensely interfering construction had a real impact on revenue, not nearly as negative as originally projected, but substantial. In June 2012, the new but not fully finished facility opened for business while the old building was demolished and the parking lot built, the grand opening celebration taking place at last in November. That particular fiscal year (2013) had 53 weeks, so the 14.5% sales growth slightly skewed the figure for the following year, a normal 52 week fiscal year that just ended this past June. The projection for the current fiscal year (2015) is 4.1%– and sales are off to a good start at 4.35% for the first 10 weeks. The next four years of growth shown on the chart as 3.5% per year is perhaps understated, but we wanted to ensure sustainability with minimal levels of revenue increases.
Based upon the above growth pattern, we estimate that we will be in a position to resume our interest payments to shareholder lenders in December 2015. A more robust expansion of sales would ensure that time line. By June 2017, we will have paid off $1,600,000 of our debt. The effect of crossing that threshold will be the infusion of about $350,000 per year into cash flow, significantly strengthening the Co-op’s fiscal condition. This means that by 2018 or perhaps sooner we will again be able to repay maturing shareholder loan principal when requested. In addition, patronage dividends to all shareholders will come back into view.
As many of you know, we have had a number of shareholder loan campaigns since all the way back to 1979. The current difficulty is the first time that there has been any delay in the Co-op’s ability to meet shareholder loan obligations. It will be a relief to be back on track! Yet, as stated in the opening lines, there has been wonderful, patient support on the part of our shareholder lenders. The Brattleboro Food Co-op community can be deeply appreciative of their contribution to what the Co-op is today. It truly shows how important the Brattleboro Food Co-op has
become to all of us.
Faster Than Cash
To All Co-op Shoppers: Help save the Co-op operating costs– minimize use of credit and debit cards. Still want to use plastic? How about using a Gift Card? It saves the Co-op money!
And it can help you manage your food budget. How to do it? Start by asking a cashier to load a gift card with an amount of your choice (cash, credit/debit, or check.) From then on, when checking out, tell the cashier you are using your gift card, run the card through the machine, and you are good to go! You’ll see the balance,
and when it runs out, you can refill it. Paying by gift card saves the co-op money because it costs nothing to use. No further processing fees to you or the Co-op! Save the Co-op money and speed up your checkout time– two great reasons to take part. Thank you!