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The Eat To Live Food Cooperative is dedicated to bringing fresh, healthy, fairly priced foods and household products to residents of Syracuse’s South Side while fostering community nutrition, cooperative ownership, and sustainable economic growth in the Greater South Side neighborhood.

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Dear Member-Owners of the Eat To Live Food Cooperative,

As the board reported at the Membership Meeting on December 17, our co-op had to temporarily close. We had no choice because we were too low on cash reserves to pay our bills for labor and stocking the store.

This closure is temporary and we will re-open as soon as possible. The co-op has a strong balance sheet. The store building is an asset that will serve as collateral for lines of credit for the working capital we need in order to operate the store until its sales grow to the break even point where we are covering all of our costs.

Our original business plan served as the basis for successfully securing the state and private foundation grants that enabled us to build the store. The grants were also supposed to provide sufficient working capital to operate the store until sales grew to the break even point.

As often happens, the best laid plans run into unanticipated events. In our case, the first event was construction bids to build the store that were far too high in our first round of bidding. We rejected these bids and we did a second round of bidding. The second round of yielded a bid that was consistent with our business plan. But we were now a year behind on our timeline for opening the store and meeting some of the grant timelines.

The second event was cost overruns in building the store. They were not unusual for this kind of construction, but they did reduce amount of working capital we had planned on to open the store.

The delay in bidding and construction then pushed us up against a deadline for the state grant, which required us to complete construction and hire staff by August 2013. Meeting that deadline was imperative because the state required us to borrow against that grant for construction. The grant money to repay the loans was only released after we had completed construction and hired staff for the store.

These deadlines forced the co-op to open with less working capital than anticipated on tight deadlines for training staff, marketing the store opening, developing supplier and vendor relations and contracts, and adjusting the operating budget to these changed circumstances. The board hired a General Manager who was not able to meet these high expectations. After a couple of months, the board let him go and worked with the remaining staff to manage the store until the cash ran too low.

The board and other co-op members are continuing to work on our next steps: updating our business plan, raising more working capital, and hiring a new general manager.

We will use what we learned from the costs and sales during the store’s first two months of operation to update the business plan, which will be part of the loan applications we make for working capital and will guide the operation of the store when we re-open.

A job notice for the General Manager position has been sent out.

The Eat To Live Food Cooperative has been seven years in development and we are not stopping now.

You can help now in two ways.

First, help build member equity in the co-op.

Continue your membership fee payments if you have not completed them. Recruit other members. Our $100 membership fees are lower than average for food co-ops because we want to make membership affordable to the many low-income people in our community.

It will take some time to negotiate and secure lines of credit for working capital from credit unions, banks, and/or cooperative development funds. Our credit applications will be stronger to the degree creditors see that the members are invested in the co-op and that we have re-opened with member-owners putting up the initial working capital. We will be asking those of you who can afford it to make a personal loan for initial working capital in addition to your membership fee in order to re-open the store as soon as possible. We will have the amount of working capital we need to re-open the store identified when we have completed updating the business plan. At that time, we will propose terms for loans.

Second, be positive and constructive.

Few worthwhile things happen without hard work, persistence, and overcoming unanticipated obstacles. We are building a community-owned grocery store in a community that the for-profit corporate chain stores abandoned and that absentee-owned corner stores exploit. We are building a cooperative store to provide our community with healthy food at the lowest possible cost to members, not for profit. Plenty of voices who don’t live on the South Side say we can’t do it. We know we can. So talk up the store with your friends, neighbors, and co-workers. Shop at the store it when we re-open. Be part of the solution, not part of the problem.

In Cooperation,

Shirley Rowser, President and Treasurer

Howie Hawkins, Secretary

Will Lewis, Board Member

Baye Muhammad, Board Member

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