A Co-op Distribution and Consulting Partner

Mission Statement

‘ We empower communities by making the

concept and practice of economic democracy
widely accessible through our retail food ‘
stores and our co-op consulting services.
Business Model: Hub and Wheel
FLOURISH FOODS CO-OP is a hub and wheel distribution center and co-op
Grocer Grocer
brand, providing centralized distribution direct to an affiliated network of Co-Op Co-Op
grocer co-ops, while also providing B2B consulting and distribution
services for existing independent co-ops through membership plans.

The central hub of the Flourish Foods brand is the exclusive vendor for its Central
related affiliates who would benefit from the economies of scale that Hub
come with being part of a networked organization. Flourish Food's primary
function is handling inter-regional logistics, ordering, shipping, and
fulfillment. The hub is funded with a per diem payment from all affiliates
and member co-ops, and a percentage of sales from affiliates.
Grocer
As imagined, the overall business structure is moderately centralized while Co-Op
the cooperative governing structure is highly centralized. As in a traditional
independent co-op, affiliate cooperatives are responsible for electing a
board of directors to oversee strategy and operations.
Ownership and Financing
Ownership: Limited Liability Corporation
Advantages
● Avoids double taxation on income (like an S-Corp)
● Avoids investor inflexibility of a C-Corp
● Offers significant legal protections
● Equitable income and taxation distribution
Disadvantages
● High cost of incorporation
● High complexity from Member-Partner structure
Financing: High Initial Capital, Low Initial Debt
Startup (Year 1)
● Prospective investors are members of existing grocer co-
ops
● We offer their organizations equity and economies of
scale from our business model
● Equity and control are proportional to contribution
Long-Term
● Once operational, debt will be an option for expansion
● Member-Partners contribute portion of net sales to FFC
Five Forces in Food Coops

THREAT OF NEW ENTRY

LOW / MEDIUM
Threat of new entry is mitigated by
significant initial investment, lengthy
HIGH incorporation procedures, and challenges
inherent in establishing a supply chain.
Suppliers in grocery often
have enough power to
regulate the industry,
especially for speciality and
high quality organics. VERY HIGH
VERY HIGH
SUPPLIER POWER COMPETITIVE BUYER POWER While co-op
RIVALRY consumers represent a less
price sensitive niche in the
market, prices are easily

THREAT OF SUBSTITUTION
comparable and switching
costs are low.
VERY HIGH
Co-ops face fierce competition from
independent local grocers, high end
generics like Wholefoods, and from mass
merchandisers like Walmart.

Source: Fernandez , F. (2019, December). Supermarkets & Grocery Stores in the US. US INDUSTRY (NAICS) REPORT 44511. Retrieved from IBISWorld database.
Competitive Analysis
Competitor Warehousing & Startup Brand
Name Retail Partners Distribution Consulting Recognition National Reach

Food Co-op Initi

ative
Co-op Partner W
arehouse
Frontier Co-op

National Co-op Gro

cers

Flourish F.C.
(Y-10 Target)
 US Wholesale
Target Markets
Food Service
Total US grocery wholesale
market size: $227.4bn Grocery

Market Segmentation:

Grocery ~ 30.8%, $70bn

< Coops
Food Service ~ 53.5%, $122.6bn
~ 5,000 grocery coops
*(Ancillary market) representing $1.5bn in
annual purchasing activity*
Other ~ 14.7%, $32.4bn

* Based on industry average 76% purchase expense and approximate $2b in aggregate annual US revenues. Sources: IBIS World US INDUSTRY (NAICS) REPORT
44511, US INDUSTRY (NAICS) REPORT 425441, and Key Industry Facts published by the NCBA CLUSA (accessed April 2020).
Sponsorship Events
Consumer Cooperative
Management Association:
Rural Food Co-op … and farmer
Conference Series markets across
the country!

NCBA CLUSA: Food Co-op Initiative:

National Co-op IMPACT UP & Coming
Conference Series Conference Series

Images represent past event promotions, current events have migrated to remote conference formats due to the threat of COVID 19.
Product/Service

Flourish Foods Co-op uses the efficient supply chain models of Aldi and Trader Joe’s,
combined with the nationwide co-operative ownership structure of REI (Recreational
Equipment, Inc.)

By combining these models, as well as selling our training and consulting services to other
co-ops, we aim to bring equity to the nationwide grocery landscape.
Pricing Strategy
Since our membership will be broadly distributed, each ownership share will be valued at
$20, with the option of paying in $5 installments. With an aggressive goal of one million
owners within our first year of operations, this will give us $20 million in equity with
which to leverage other funding sources.

Our products will lead the competition both in quality and in price. Our efficient, ethical,
and transparent supply chain is an integral part of our value proposition.

Consulting services will be offered on a sliding scale, based on the average income in the
area in which each client organization is located. Information and advice will be based on
proven strategies Flourish Foods Co-op uses itself.
Y1 Financials
We have prepared for three possible scenarios in Y1: Pessimistic, Expected, and Optimistic. All memberships are
$20 annually.
● Pessimistic: 80% of our target; 800,000 members ~ $16,000,000 equity
● Expected: 100% of our target; 1,000,000 members ~ $20,000,000 equity
● Optimistic: 120% of our target; 1,200,000 members~ $24,000,000 equity

Capital campaign figures were mapped using an exponential function. We assume low levels of initial interest but
exponential increases in enrollment once monthly donations to co-ops begin, coupled with rigorous marketing
campaigns. This supports our mission of co-op proliferation and evangelizes our brand in the co-op community.
Financial Projections
These rough predictions detail a modest (figures in thousands)
revenue expansion in years 2, 3, and 4.

Because of our projected investor base, our

best course of action is rapid expansion. We
will be able to offer services at competitive
prices, which naturally lends itself to
expanding quickly.

This high level of growth will be excellent for

attracting new forms of capital, such as
venture capital and debt.
Flourishing in the Future

In ten years, whenever anyone thinks of co-ops, they will think of Flourish Foods.

We will have increased public awareness of, and participation in, democratic forms of
ownership, transforming the concept from a high-end luxury experience for bourgeois
hippies, into a sane, stable, and scalable solution for a world whose winner-take-all
economies were recently ravaged by the Covid-19 pandemic.

We will have inspired and supported other such organizations to take root and grow,
offering more and more examples of ethical, community-oriented business structures.

Our business is food... but our purpose is to make society more equitable.