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To find more resources for your business, home, or family, visit the College of Agricultural, Consumer and Environmental Sciences on the World Wide Web at aces.nmsu.edu Economic Significance of Food Cooperatives in New Mexico Research Report 789 Jay Lillywhite and Erin Frye1 Agricultural Experiment Station • College of Agricultural, Consumer and Environmental Sciences INTRODUCTION Food Cooperatives in the United States Food cooperatives—retail grocery stores owned and operated by their customer-members—account for a relatively small portion of total retail food sales. Despite this, food cooperatives play a significant role in the food retailing sector, especially in intermediate supply chains (King et al., 2010)2. Their importance is often associated with giving small, local producers access to consumers while at the same time giving consumers access to locally produced foods. Additionally, food cooperatives have been associated with innovation within the retail food sector, promotion of societal interaction and well-being, and consumer education (Deller et al., 2009; Ipatenco, 2014; King et al., 2010). While the exact number of food cooperatives operating in the United States is not kept by official government agencies, several sources can be used to identify the prevalence of food cooperatives in the country. For example, the National Co+op Grocers (a business services cooperative for retail food cooperatives) has 142 cooperative members operating 190 stores in 38 states (NCG, 2014). Researchers at the University of Wisconsin Center for Cooperatives estimated in 2009 there were 290 food cooperatives operating 446 establishments, with membership of nearly 0.5 million (Deller et al., 2009). The popularity of and participation in consumer-owned cooperative grocery stores has waxed and waned over their history in the United States. Periods of their growth have often been associated with social, political, or economic turbulence (Deller et al., 2009). A resurgence of consumer interest in food nutrition and health (Rozin et al., 1996), food sources, and concern for local producers may indicate a positive future for food cooperatives. For example, Tice (2013) reports that of the top ten food trends ranked in the National Restaurant Association’s “What’s Hot in 2014,” four trends were related to sourcing locally produced food products. Cone Communications reports that 89% of Americans consider where a product was produced when making a food purchase decision, and two-thirds are willing to pay more for food that is sourced locally. Two-thirds of surveyed consumers indicated that their primary reason for purchasing locally sourced food was associated with supporting local businesses (Cone Communications, 2014). Deller et al. (2009) estimated the economic impact of cooperatives in the United States for a large variety of different cooperative types, e.g., farm supply and marketing, credit unions, etc. Using input-output analysis, they estimated that total revenues for food cooperatives in 2009 were $2.10 billion. Direct revenues from cooperative sales translated into additional sales in associated industries of $26 million. The output multiplier associated with their analysis was 1.01. The corresponding employment multiplier was estimated to equal 1.13. The 1Respectively, Professor, Department of Agricultural Economics and Agricultural Business, New Mexico State University; and private consultant. 2Intermediate supply chains are defined as supply chains for local products that reach consumers through one or more intermediaries (King et al., 2010). NMSU photo by John Garlisch.
Object Description
Title | Economic significance of food cooperatives in New Mexico |
Series Designation | Research Report 789 |
Description | Estimates the economic impact of grocery cooperatives in New Mexico |
Subject | food industry (NAL); Food industry and trade--New Mexico; cooperatives (NAL); grocery stores (NAL); Grocery shopping; |
Creator | Lillywhite, Jay M.; Frye, Erin |
Date Original | 2015-10 |
Digital Publisher | New Mexico State University Library |
Rights | Copyright, NMSU Board of Regents. |
Collection | NMSU Cooperative Extension Service and Agricultural Experiment Station Publications |
Digital Identifier | UAAPr000789.pdf |
Source | http://aces.nmsu.edu/pubs/research/economics/RR789.pdf |
Type | Text |
Format | application/pdf |
Language | eng |
Page Description
Title | Page 1 |
Series Designation | Research Report 789 |
Subject | food industry (NAL); Food industry and trade--New Mexico; cooperatives (NAL); grocery stores (NAL); Grocery shopping; |
Creator | Lillywhite, Jay M.; Frye, Erin |
Date Original | 2015-10 |
Digital Publisher | New Mexico State University Library |
Rights | Copyright, NMSU Board of Regents. |
Collection | NMSU Cooperative Extension Service and Agricultural Experiment Station Publications |
Is Part Of | Economic significance of food cooperatives in New Mexico |
Type | Text |
Format | application/pdf |
Language | eng |
OCR | To find more resources for your business, home, or family, visit the College of Agricultural, Consumer and Environmental Sciences on the World Wide Web at aces.nmsu.edu Economic Significance of Food Cooperatives in New Mexico Research Report 789 Jay Lillywhite and Erin Frye1 Agricultural Experiment Station • College of Agricultural, Consumer and Environmental Sciences INTRODUCTION Food Cooperatives in the United States Food cooperatives—retail grocery stores owned and operated by their customer-members—account for a relatively small portion of total retail food sales. Despite this, food cooperatives play a significant role in the food retailing sector, especially in intermediate supply chains (King et al., 2010)2. Their importance is often associated with giving small, local producers access to consumers while at the same time giving consumers access to locally produced foods. Additionally, food cooperatives have been associated with innovation within the retail food sector, promotion of societal interaction and well-being, and consumer education (Deller et al., 2009; Ipatenco, 2014; King et al., 2010). While the exact number of food cooperatives operating in the United States is not kept by official government agencies, several sources can be used to identify the prevalence of food cooperatives in the country. For example, the National Co+op Grocers (a business services cooperative for retail food cooperatives) has 142 cooperative members operating 190 stores in 38 states (NCG, 2014). Researchers at the University of Wisconsin Center for Cooperatives estimated in 2009 there were 290 food cooperatives operating 446 establishments, with membership of nearly 0.5 million (Deller et al., 2009). The popularity of and participation in consumer-owned cooperative grocery stores has waxed and waned over their history in the United States. Periods of their growth have often been associated with social, political, or economic turbulence (Deller et al., 2009). A resurgence of consumer interest in food nutrition and health (Rozin et al., 1996), food sources, and concern for local producers may indicate a positive future for food cooperatives. For example, Tice (2013) reports that of the top ten food trends ranked in the National Restaurant Association’s “What’s Hot in 2014,” four trends were related to sourcing locally produced food products. Cone Communications reports that 89% of Americans consider where a product was produced when making a food purchase decision, and two-thirds are willing to pay more for food that is sourced locally. Two-thirds of surveyed consumers indicated that their primary reason for purchasing locally sourced food was associated with supporting local businesses (Cone Communications, 2014). Deller et al. (2009) estimated the economic impact of cooperatives in the United States for a large variety of different cooperative types, e.g., farm supply and marketing, credit unions, etc. Using input-output analysis, they estimated that total revenues for food cooperatives in 2009 were $2.10 billion. Direct revenues from cooperative sales translated into additional sales in associated industries of $26 million. The output multiplier associated with their analysis was 1.01. The corresponding employment multiplier was estimated to equal 1.13. The 1Respectively, Professor, Department of Agricultural Economics and Agricultural Business, New Mexico State University; and private consultant. 2Intermediate supply chains are defined as supply chains for local products that reach consumers through one or more intermediaries (King et al., 2010). NMSU photo by John Garlisch. |