Shared economics means that there is a close connection between the well-being of the co-op and its workers and shoppers. When one benefits, the other benefits; each supplies what the other needs, and the two act like a unit with respect to the broader market.
Employee wages and benefits improve as productivity increases
One of the most important dimensions of shared economics is the relationship between WSM’s success and the success of our employees.
Over the past three years, sales increases and the corresponding increase in productivity have enabled WSM to increase hourly (non-manager) wages by an average of 7% per year. This puts us on track to exceed $15/hour next year for this hourly average. In addition, WSM increased benefits by an average of $1.00 per hour over the last year with improvements to dental, vision, wellness, and retirement. 401k participation went from 38% to 80%.
For the past four years, the board has been allocating 50% of profits to the worker owners. This translates to a patronage dividend this year of 78 cents per hour or $1,600 for a full-time worker owner.
WSM saves big by refinancing loan with co-op bank
Weaver Street will save $200,000 annually after refinancing our loan with NCB, the national co-op bank. The interest rate dropped from 6.5% to 3.75%. We repaid $400,000 in principal, and $1.6 million was forgiven as a result of the unwind of our New Market Tax Credit package. WSM received the tax credit for creating jobs when we expanded to Hillsborough.
WSM moved our main bank accounts to NCB in order to bank with a co-op. NCB’s customers are cooperatives such as grocery wholesaler co-ops, purchasing co-ops, or housing co-ops. We now have co-op stock in NCB and will receive a patronage dividend on the interest that we pay.
Weaver Street expands co-op to co-op trade
Another dimension of shared economics is developing direct relationships with producer co-ops. WSM has long-term relationships with many producer co-ops including Organic Valley, Equal Exchange, Once Again Nut Butters, and Frontier Cooperative Herbs. All together we purchased over $1 million from co-ops this year and added two new suppliers:
PRAGOR is a progressive group of small-scale avocado farmers in Michoacán, Mexico. This region of Mexico is considered the avocado capital of the world. However, powerful corporate interests have made it difficult for small-scale farmers to compete. In response, PRAGOR courageously organized and decided they would collectively control the entire process from growing to exporting. WSM purchased over $100,000 of avocados last year from PRAGOR under the Equal Exchange Brand.
LA RIOJANA is a co-op of small grape growers in Riojana, Argentina. La Riojana is a co-op in northwest Argentina whose members farm an average of six acres. It’s in a poor part of the country and the co-op has greatly improved living conditions by developing a water system, a secondary school, and a hospital among other projects. The co-op is also working on creating sustainable villages with solar power and organic farms. Although La Riojana sells a lot of wine in Europe, it hasn’t been able to break into the US market in a significant way, so Weaver Street is connecting La Riojana with co-ops across the US. Learn more about La Riojana here.