Weaver Street Market

Weaver Street came about because of two frustrations its founders had with food shopping in the Chapel Hill region: one with mainstream grocery stores, and the other with co- ops.

Ruffin likes organics but also believes that food should be produced locally and fairly. He grouses about Walmart’s selling organic foods sourced from China, that most other organics are coming from big factory farms, that these organic marketers are increasingly shortchanging traditional family farmers. He wanted to create a store where people could buy food that was “authentic.”

The Weaver Street 2007 annual report defines authentic food as “organic products from small farms that embody the spirit of organic farming rather than factory farms that do the minimum to get by. Authentic food means products from local producers who contribute to a sustainable food system, retain artisan production techniques, and allow family farmers to stay in business. Authentic food means fair trade—fair payment to farmers in the developing world that produce crops such as coffee that can only be grown in warmer climates. Authentic food means products from our own kitchen and bakery, where we use high quality ingredients and maximize quality and freshness.”

Authenticity means that an aisle of Weaver Street should resemble a local street fair with vendors representing the region’s food system. You can find milk from Maple View Farms, fresh eggs from Hillsborough, flour from Lindley Mills in Graham, and all kinds of North Carolinian produce.

Weaver Street also has its roots in Ruffin’s frustrations with other food co-ops. “Historically, food co-ops have been marginalized in their communities—the hippies, the weird people, the weird food.” Weaver Street appeals to the mainstream. It emphasizes middle-of-the-road products with a local identity. Its community events involve more than just the co-op’s members—they draw all kinds of people. So does its in-house restaurant. “We’re not,” says Ruffin, “just the unknown store that people are afraid to try.”

In fact, much of Carrboro’s cultural life swirls around Weaver Street. The cooperative sponsors an average of four community events per week. Some are built around holidays, like “Ghost Stories under the Stars” at Halloween. Others have become regular features of downtown Carrboro, like the Sunday jazz brunch and the Thursday night music jams on the lawn.

Ruffin hopes that Hillsborough, the newest grocery store location, will create some of the same community impacts the Carrboro location has. Hillsborough’s downtown is currently filled with storefront vacancies and devoid of street life—essentially what was true of Carrboro before the first Weaver Street store opened. The Hillsborough location is designed with a café and outdoor seating, all plainly visible to people driving by to attract more activity.

But despite these positive community impacts, Ruffin laments that Weaver Street doesn’t currently serve everyone it might. “There are parts of the community we don’t reach. A lot has to do with price. It is impossible to compete with grocery stores on price, or fast food restaurants on price. We’ve developed a food system in the United States that provides really cheap, mass produced, mediocre-quality food that, if you’re on a tight budget, is seen as a good food option. High quality and organic foods cost more—at least right now.”

Ruffin also wanted Weaver Street to be a different kind of cooperative. Specifically, he wanted scale. He knew that successful natural food stories were shifting from being very small operations to being the size of large grocery stores, with Whole Foods Market being an example. As a college town, the Chapel Hill area was ripe for a large- scale natural food store.

One unusual feature Ruffin built into the cooperative was multiple stakeholders. It was to be not just consumer- member owned but also worker owned. Nearly 100 workers now are voting shareholders and participate in the cooperative decision making. “Consumer ownership can slow things down, people tend to like what they have and don’t want to risk it,” Ruffin explains. “Worker owned means being a lot more entrepreneurial. We’re willing to take more risks, to try new things. This is a critical element of our business success. If you’re not changing, then over time you’re going to lose market share.”

“Obviously the workers in an enterprise know a lot, if you can tap that knowledge, you can improve the business. We didn’t really obsess about how you actually do it. We just said—consumers own half, workers own half, and we go from there.”

Mindful of its community mission, its ambition, and its desire to evolve, Weaver Street has greatly expanded over the years into other businesses: a restaurant, a radio station, and a housing cooperative. It has plowed some of its net revenue into a Cooperative Community Fund that supports local groups working on sustainable agriculture, food, hunger, malnutrition, environmental protection, and cooperatives. The ongoing need for capital led it to launch the Community Investment Initiative, which borrows money from members (the minimum is $10,000), pays a simple 6% interest annually, and agrees to repay principal at the end of five years.

Besides the third store, another major expansion, also in Hillsborough, is a commissary kitchen and bakery called the Food House, which allows all the Weaver Street stores to expand the prepared-food market with quality cooking and local ingredients. The facility also provides enough warehouse space for the co-op to consolidate orders, improve efficiency, and begin to create a more comprehensive system of local sourcing.

Over its 20 year life, Weaver Street has earned enough net revenue to retire nearly all its debt. Now new debt is being taken on to finance the third store and the commissary. In 2007 its net revenue was $360,000, nearly triple its 2006 revenue.

Ruffin gives a sense of how this translated for the members in 2007: “Our consumer owners received $399,598 in discounts at the cash register. Based on total consumer share investment of about $1 million, this represented a return on share investment of 39%. Our worker owners receive a patronage dividend based on hours worked, which totaled $151,534, or $1.01 for every hour worked during the year. Based on a total worker share investment of $406,048, this represented a return on share investment of 37%.”

These economic impacts extend to the community in a big way that wouldn’t be possible if Weaver Street were not locally owned. “This year our co-op passed the $20 million sales mark, meaning that $20 million was directed into the cooperative economy rather than the corporate economy,” Ruffin explains. “Since 41% of the money spent at Weaver Street Market is spent directly in the local community, and by applying standard industry multipliers to calculate total economic impact, we calculate a total of $12 million in local economic impact that our co-op created last year. Another way we measure our contribution to our local economy is the amount we purchase from local farmers and food producers, which last year amounted to over $2 million.”

An additional way Weaver Street measures its social bottom line is in the number and success of its community events. In 2007 Weaver Street hosted 194 community events throughout the year— an average of almost four per week.” Its environmental bottom line is equally impressive. “We purchased 10% of our electricity from green energy sources, and recycled 14 different waste streams in 2007. In our Hillsborough store we recycle waste heat from the refrigeration system and use it for heating water. We collect waste water from the sinks and use it for toilet flushing, and collect rainwater and use it for irrigation.”

Ask almost any resident of Carrboro about what the most important businesses for the local economy are, and Weaver Street Market will come up. In 2006 the Chapel Hill-Carrboro Chamber of Commerce named it the Sustainable Business of the Year, calling it “a community fixture.” Yes! Magazine called it one of the seven best alternative businesses in the country.