Standard Co-op dissolves

By Miriam Ostermann, Associate Editor

A large majority of Standard Co-op members voted in favour of the store’s dissolution last week, after ongoing losses and dwindling cashflow left the ledger dripping with red ink for many years.
Sixty-five members and 22 guests assembled at the Standard Community Hall on Feb. 22 to vote by secret ballot, requiring the support of two-thirds of the members, and pass a special resolution for the voluntary dissolution of the cooperative under the provisions of the Alberta Co-operatives Act, 2001.
Following discussions on the store’s financial history, current monetary situation and other possible options for the space, members were told they had two options. One: vote in favour of dissolution, liquidate all assets, pay bills and creditors, and use remaining surplus, if any, to be distributed to the members based on the records of equity held in the Standard Co-op. Two: take no action, face bankruptcy estimated in a month and receive no funds in return. Members voted 58-7 in favour of dissolution.
“I’m sure we all know that for several years we’ve carried some losses, quite large losses, at our co-op and historically sales have dropped,” said Cathy Christensen, general manager at the Standard Co-op.
“None of these years have we made money, and we’ve been losing money since 2009. It’s not possible. Every month is a struggle as sales decrease, which is happening. The writing is on the wall.”
According to Christensen, sales in 2018 are already down $20,000 compared to last year. Members were also told that $109,000 is past due for accounts payable. In total, the cooperative is looking at $127,000 in total debt owing along with a $25,000 credit line for an overall debt of $152,000.
The Standard Co-op Limited Historical Statement of Operation states sales have dropped roughly 23 per cent since 2013 to approximately $1.066 million from $1.393 million.
Over the years, the board and management reduced inventory, shrank expenses and sold assets. Yet with supplier accounts past the due date and in light of their current financial situation, the board asked for the support of their members.
Furthermore, substantial repairs and upgrades to equipment, such as coolers and a freezer, and the management of space, also played a factor in the board’s decision to call for the special resolution.
Some members raised concern about not having explored other options – such as renting out space in the building or having someone take over the store – and asked for greater detail on the process. Other members were also concerned about the liquidation of assets and the impact on the community.
“It’s sad, we’re losing the only place to get groceries locally, and most of the seniors come in every day,” said Missy LeBlanc, who’s lived in Standard since 2010 and worked at the Standard Co-op for the past six months.
“Every day they get the paper and their daily groceries and they’re not going to have that. There’s really no option. Either we dissolve or we go bankrupt in a month. That’s it, there’s really no other way.”
After the vote, members also voted in favour of appointing Ken Edey as liquidator. Mindful of the financials, Edey quoted a cost of $14,600 in comparison to $20,000 he was aware of in other situations in Alberta.
“It will be necessary to take whatever steps are necessary to liquidate the inventory in a relatively short period of time,” said Edey. “In so doing, you will also stop incurring the expenses of operation. What is in the best interest of the members would be to strike a balance of the expenses of operating and liquidating the inventory and freeing up that cash.”
Fixtures and equipment for sale include a meat band saw, a Butcher Boy grinder, Hobart slicer, vacuum sealer, tenderizer, electronic fork lift, Lozier shelving and an Aztec Proscrub floor scrubber.
Darrell Larsen, president of the board of directors, Dave Dyck, associate vice president Calgary region Co-op, and Joe Bowhay, Federated Co-operatives Limited district five director, were also among those in attendance on Feb. 22
No new inventory has been ordered. Staff at the store received their notices and the layoff date is March 9. The last day of business at the Standard Co-op is March 17.