Boise Co-op store in Meridian signals a pivot for Boise institution

General Manager Ben Kuzma has made the Boise Co-op’s business structure more competitive for the age of Whole Foods, Trader Joe’s, Natural Grocers and Rosauers. Photo by Teya Vitu
General Manager Ben Kuzma has made the Boise Co-op’s business structure more competitive for a marketplace that now includes natural grocery stores such as Whole Foods, Trader Joe’s, Natural Grocers and Rosauers. Photo by Teya Vitu

Grocery cooperatives not all that long ago did their own thing. They stocked odd bulk foods, incense, and hyper-local produce. They featured handmade signage and attracted counter-culture shoppers. They were pretty much the only place to find natural and organic foods.

Now food co-ops are so popular that their concepts are regularly lifted by supermarket chains. Shoppers of all stripes now use co-ops, and millennials aren’t interested in the traditional co-op ambiance of the 1970’s or 1980’s, said C.E. Pugh, chief operation officer at National Co+op Grocers, the recently renamed National Cooperative Grocers Association.

The member-owned Boise Co-op has changed in recent years to meet customer needs by widening its aisles, restructuring its management and reorganizing its stock. And now it’s opening a store at The Village at Meridian, the nearly 1 million-square-foot  “lifestyle center” built on 90 acres by by El Segundo, Calif.-based CenterCal Properties. The Village, as it is known, has a 15-screen movie theater and a lighted fountain, all of which starkly contrast with the old image of a co-op.

A decade ago, a co-op would not have considered opening in a lifestyle center. Nor would a lifestyle center have embraced a food co-op.

But Boise Co-op General Manager Ben Kuzma, who came on board in 2011, saw the Village as a place where he could build an appealing, customer-focused and highly functional co-op from the ground up.

“We can have a nice store but we want to have an incredible store,” Kuzma said.

Co-op and natural food stores have been struggling in recent years to keep up with the competition. These days, conventional supermarkets sell 40 percent of all organic and natural products, Pugh said. Where mainstream supermarkets carried only about 1 percent natural and organic foods in the 1980s, and about 7 percent in 2003, now it’s up to 15 percent.

For the Boise Co-op, the wake-up call was the 2006  announcement  that Whole Foods planned to build a store downtown. When Kuzma started at the Co-op, in June 2011, he discovered the Boise Co-op had taken no action to counter the opening of the popular Austin,Texas-based chain in 2012 just one mile away.

Then Natural Grocers opened a store in Boise in February 2012, and Rosauers opened in Meridian in December 2013, adding two more purveyors of natural foods.

Kuzma took a hard look at the Co-op’s wares and decided to make some fundamental changes.  The Co-op’s business structure dated back decades, and the store had 25 managers. Kuzma cut the number of managers to eight and split the store into two sections. He grouped produce, deli and meat under one fresh food manager and dairy, wellness items and general merchandise under one center store manager.

“When I came on, I knew we weren’t ready (for competition with Whole Foods),” Kuzma said. “We were a gourmet store that sold natural products. We flipped that around. Now we are a natural foods store that has gourmet food products.”

Kuzma also had the Boise Co-op join the National Cooperative Grocers Association, a business services cooperative that was established in 1999 and has 143 member grocery co-ops. The association provided a designer to plan and design the Meridian store. The association also provided training for store employees. Then Kuzma started looking for new space.

With its new store, the Boise Co-op will break a 40-year tradition of moving into less-than-ideal spaces and then making do.

“We will have something that functions well,” he said. “We’re not doing that here. We don’t even have a loading dock here (on Fort Street).”

Boise Co-op expects to open a second store at Village at Meridian in October. Photo by Teya Vitu.
Boise Co-op expects to open a second store at The Village at Meridian in October. Photo by Teya Vitu.

The Village Co-op store will be at the north end of the Village North Building that also contains Marshall’s and Toys R Us. The groundbreaking is in February, with the store expected to open by mid-October.

The Village in no way matches the traditional image of a grocery co-operative, which strives for authenticity. And despite the work Kuzma had done to modernize the Boise Co-op, he didn’t  instantly gravitate to the lifestyle center.

“It grew on us more and more,” he said. “They were trying to bring in a local flavor. They were dealing with different age groups and demographics. They were trying to create more of a community center.”

The Village at Meridian does proclaim itself as “The Unexpected.” The center predominantly features national retailers but there are a handful of local companies, and General Manager Hugh Crawford said he seeks local tenants.

“Our vision has always been to be really tied to the community,” Crawford said. “We think the Boise Co-op is an absolute win for the shopping center and the community. That’s what the community wanted. That’s what they asked for.”

Crawford said he talked with Whole Foods and Trader Joe’s but they decided to go downtown.

“Everything kept pointing toward the Boise Co-op,” Crawford said. “They ended up being the best partner for the project.”

The Boise Co-op has annual revenue of $24 million, down from $26 million before Whole Foods opened. Kuzma anticipates the Meridian store will add $15 million in the first year and build up to match the Fort Street store in perhaps three years.

Kuzma dismisses the idea that the arrival of Whole Foods and Trader Joe’s – and the chance that they could move to the Village first – led the co-op to Meridian. He said he looked at the bigger picture of how the Boise Co-op fits into the Treasure Valley.

“The whole Treasure Valley is growing,” Kuzma said. “If you are not growing with that, you will be left behind.”