Behind the Changes at Deep Roots Market in Downtown Greensboro

Deep Roots Market
(Last Updated On: February 21, 2017)

Deep Roots Market

If Deep Roots Market Cooperative were the proverbial cat with nine lives, one might say it has four down, five still in reserve.  It survived a financial crisis in 1982, another in 1991, again in 2002, and a tight situation over the past year.  Now, as Deep Roots approaches its 41st anniversary celebration next month, this community-owned business is looking towards a midlife resurgence.

My YES! Weekly editor, knowing that I’m actively involved with Deep Roots, asked me to provide an update on what’s going on at the Co-Op.  Disclosure: I was elected to the Deep Roots Board of Directors last May, and became Board President last month.  I was also General Manager from 1982-1989, 1991-1994, and 2006-2013.

Deep Roots is a community-owned business with thousands of Owners.  Whereas most businesses focus solely on the bottom line of financial profit, Deep Roots historically has been a “triple bottom line” business.  This means that it focuses not only on financial profit, but also on its impact on people and on the environment.  You certainly have to at least break even moneywise to stay in business, but that has never been the sole concern of this Cooperative.  As an example, even though retail space is at a premium in the relatively small grocery store, nonetheless space was set aside for a Community Room.  This room is available for groups to use at no charge.  Hopefully people who use the room do some shopping while they’re at the store, but they aren’t required to do so.  Even if they do, it still wouldn’t make up for the financial volume that could be generated by converting the room to retail space.  That’s okay because providing community services is part of how Deep Roots determines its success as a business.

When Deep Roots moved to its current location it was known that finances would be tight.  This goes back to its financial crisis of 2002 that used up all the cash accumulated over the preceding years.  The crisis also incurred substantial debt.  The Co-Op’s subsequent financial recovery was then interrupted by the Great Recession.  As a result the move to the current location had to be negotiated with little cash on hand.  This required unusually large amounts of debt to be taken on to finance the move.  So what was known would be a tight situation became critical when sales faltered at the new location.  There’s not space for a full review of all that’s occurred, but here’s a summary of what’s happened during recent months:

DEPARTURE OF THE GENERAL MANAGER.  In October, the Board of Directors and the General Manager (GM) of two years agreed to a separation.  My personal view is that the GM, despite a long successful grocery career as a department manager, was unable to meet the additional challenges of being a GM.

RESIGNATION OF 5 DIRECTORS.  At the November Board meeting, five of the nine Directors announced their resignations effective December 31.  This reflected a split that had developed as to how best to move ahead.  Since Deep Roots bylaws prioritize Board decisions by consensus, this split made it difficult to move forward with the unity required of Board actions.  The outgoing Directors decided to step aside to allow the remaining Directors the opportunity to chart direction.

BOARD REORGANIZATION.  The remaining Directors called a special meeting that took place Jan. 9 for the purpose of electing new officers.  They also made appointments to some of the open seats.  Two were purposely left open for the Co-Op Owners to vote on at this May’s Annual Owners Meeting.

HIRING AN INTERIM GENERAL MANAGER.  The Board hired Nicole Villano as Interim General Manager (IGM), effective February 1.  Ms. Villano has extensive managerial-level natural foods grocery experience.  She has natural leadership skills.  Most importantly, she is excellent at, and delights in, customer service.  The Board feels fortunate to have her in place.

THE NATIONAL COOPERATIVE GROCER.  The National Cooperative Grocer (NCG) is an association of U.S. retail grocery co-ops.  NCG represents almost $2 billion in annual retail sales.  It has negotiated key contracts on behalf of its member co-ops.  These deals are far more beneficial than what the individual co-ops could negotiate on their own.  They allow Deep Roots to be price competitive with the other natural food outlets in town.  NCG has been fully supportive of Deep Roots during this difficult transition time.  They’ve provided on-site consultants to help guide and support different aspects of store operations as the departed GM left many areas needing immediate attention.

LANDLORDS.  The Co-Op’s landlords, North Eugene Partners, have been fully supportive of Deep Roots efforts and have helped out in different ways.  Thanks Vernon, Bob, and George!

THE DOWNTOWN GREENWAY.  The 4.1 mile Greenway being built around downtown will replace the sidewalk directly in front of Deep Roots.  When completed it will provide a lovely upgrade to the streetscape.  It will also provide a ready connection by foot and bike to many nearby neighborhoods.  Construction has been underway in front of the store since November and is scheduled to end mid-March.  Unfortunately, even though there is always clear access in and out of the parking lot, the street work in front of the store has significantly decreased sales putting an additional strain on finances.  But the end is in sight and we look forward to the Greenway gracing our sidewalk.

PRODUCT POLICY.  The sad truth about food production in the U.S. is that the vast majority of products on supermarket shelves contain at least one item known to contribute to obesity, diabetes, hyperactivity, intestinal problems, heart disease, or any of a host of other ills.  Historically, Deep Roots’ mission has been to promote health and avoid questionable ingredients.  Last Spring the General Manager and Board concluded that market conditions required an adjustment to this business strategy.  While the focus remained on natural and organic, “conventional” products were added to the product mix.  This change is now under review.  The Board has begun planning a series of meetings with Deep Roots Owners to get their input on product preferences and overall store direction.  At the same time, Management will be conducting surveys with existing customers as well as people in the surrounding neighborhoods to find out what products, if any, they would likely buy if Deep Roots stocked them.  It’s worth noting that the Co-Op has been a leader in various areas.  To the best of my knowledge it was the first grocery store in town to:

  • stock organically grown produce;
  • host a Farmers Market in its parking lot;
  • install a bulk water machine where customers could reuse their own containers and get purified water for gallons on the dollar;
  • offer a bonus to employees who commute to work by foot, bike, bus, or carpool;
  • discontinue offering plastic bags at the checkout counter;
  • prioritize and emphasize buying locally-made produce and other products;
  • do presentations before City Council about the importance to our economy of supporting our local businesses;
  • successfully petition two different Mayors to proclaim an “Eat Local Month”.

In other words, Deep Roots hasn’t been one to follow the herd.  Stay tuned to see what these changing times bring.

  • Landau’s column appears the 4th Wednesday of each month.