This document discusses assessing the feasibility of starting a food co-op. It defines feasibility and explains that a feasibility study examines the market, organizational/technical, and financial issues of a proposed business to determine if it is viable. The document outlines six key areas of feasibility for a food co-op: vision, market demand, financial projections, organizational capacity, supplier access, and site availability. It stresses that a full feasibility study should include professional market research and financial projections to provide an objective analysis for potential investors.

1. Assessing Feasibility
Understanding, evalua4ng and improving

2. Stuart Reid
Execu4ve Director
Food Co-op Ini4a4ve

3. Feasibility
fea·si·bil·i·ty
fēzəˈbilədē/
Noun
the state or degree of being easily or
conveniently done.

4. Vision & Mission
Vision noun vi·sion ˈvi-zhən
a : the act or power of imagina4on
b (1) : mode of seeing or conceiving
(2) : unusual discernment or foresight
c : direct mys4cal awareness of the
supernatural usually in visible form
Mission noun mis·sion ˈmi-shən
a) a pre-established and often self-
imposed objective or purpose

5. A Coopera4ve Perspec4ve
n A feasibility study is designed to provide an overview of the primary
issues related to a business idea. The purpose is to iden4fy any
“make or break” issues that would prevent your business from being
successful in the marketplace. In other words, a feasibility study
determines whether the business idea makes sense.
n A feasibility study looks at three major areas:
n Market issues
n Organiza4onal/technical issues
n Financial issues
Coopera,ves: A Tool for Community Economic Development)

6. Where do feasibility benchmarks come
from?
Since 2006, FCI has worked with hundreds of communi4es that were
star4ng food co-ops and over 150 that have successfully opened their
doors.
The standards used for feasibility have been developed from over a
decade of direct support, observa4on, and collected data plus the
financial performance history of established food co-ops.

7. Areas of feasibility
1. Vision: Do we have a vision that resonates in our community?
2. Market Feasibility: Is there enough demand for the products and
services the co-op will offer?
3. Financial Feasibility: Will we be able to raise enough capital to finance
our co-op? Can the co-op operate profitably?
4. OrganizaAonal Capacity: Do we have the talent and capacity to
develop a successful startup?
5. Supply Access: Are there appropriate vendors, growers and
distributors who are willing to sell to us?
6. Site Availability: Are there suitable loca4ons for a retail grocery store
available at affordable costs?

8. Do we have a vision that resonates in
our community?
n People come to our events
n New owners are signing up
n Community thought leaders are backing us
n Public officials are suppor4ve

9. Is there enough poten4al demand for
the co-op’s goods and services for the
co-op to be sustainable?
n Community survey results indicate strong demand
n Current and an4cipated compe4tors are not mee4ng needs
n Market study confirms poten4al revenue

10. Will we be able to raise enough capital
through owners and lenders to finance
our co-op?
n Sources & Uses Budget
n Community wealth
n Depth of support
n Poten4al lenders
n Poten4al economic development funds

11. Can the co-op operate profitably?
n Reliable market study
n Professional financial projec4ons
n Accurate and realis4c assump4ons

12. Do we have the people with 4me, skills
and talent to see this project through
to comple4on?
n Founding Team
n Steering Commi_ee
n Board
n Volunteers
n Specialists

13. Are there appropriate vendors,
growers and distributors who are
willing to sell to us?
n Local growers and processors
n Natural & organic
n Conven4onal
n Minimum orders
n Compe44ve prices

14. Are there suitable loca4ons for a retail
grocery store available at affordable
costs?
n Local commercial property rates
n Demand and supply
n Developer op4ons
n No compromises!

15. Timing

16. A full feasibility study includes:
n Clear and accurate business assump4ons
n Site commitment
n A formal market study (professional)
n A community survey
n Supplier and vendor assessment
n Evalua4on of available talent, both for organizing and opera4ons
n Financial budgets and projec4ons (professional)
n Availability of capital and willingness of members and lenders to invest
n Engineering and design reviews

17. Feasibility results & your business plan
n Business assump4ons
n Site
n Market analysis & revenue projec4ons
n Community support
n Suppliers and vendors
n Organizing team, professional support, and management
n Sources & uses budget and pro forma financial projec4ons

18. Objec4ve Analysis
A feasibility study evaluates the project's poten4al
for success; therefore, perceived objecAvity is an
important factor in the credibility of the study for
poten4al investors and lending ins4tu4ons.

19. It is never risk-free.
Some things may not be measurable or knowable
n Management talent
n Board professionalism
n New compe4tors
n Economic downturns

20. Using the Feasibility Assessment
n On-line survey format
n Each board member or group exercise?
n Using the results
n Outside perspec4ve/objec4ve review
n Ac4on items

21. How We Did it at Assabet
Village Co-op Market
n Siobain Mitchell
How We Did it at Assabet Village Co-op Market

22. Case Study: Assabet Village Co-op Market
Located: Maynard, MA
Incorporated: 2013
Member-Owners: 1,046
(as of January 21, 2019)
PopulaAon: ~ 10,300
Square miles: 3.5
Sites Looked At: 12
Market Studies Done:
• 2 full
• 2 updates

25. The Importance of Developing a Healthy
Board Culture

28. Talking to your Owners
DO: Keep up communica4ons
DO: Be honest about the results of your assessment
DON’T: Predict how long site selec4on will take
DO: Talk about how your assump4ons are just that
DON’T: Put a number on your capital campaign (yet)

29. Ques4ons?

30. Food Co-op Ini4a4ve
info@fci.coop
www.foodcoopini4a4ve.coop
844-324-2667