FROM THE BOARDROOM
The Deep Roots Market Board of Directors is pleased to announce that it has hired Nicole Villano as Interim General Manager. Ms. Villano has years of grocery management experience, which includes setting up and managing our store’s Food Service Dept. and a stint overseeing Marketing. She recently returned to Deep Roots after some time away and was working in the Wellness Dept. prior to now becoming Interim GM. We feel fortunate to have Nicole on board, given her breadth of experience, leadership skills, and commitment to the Co-Op. Please offer congratulations when you see her in the store!
The Board is planning to have 2 or 3 meetings to hear from Owners in March and April. The goal of these meetings will be to encourage Owner Engagement and gather feedback for the direction of the store. Stay tuned for dates and more info!
The current schedule is for the Greenway construction in front of the store to be completed March 10. We’re looking forward to the beautiful new streetscape that our block will then have. Meanwhile, please continue to shop at the Co-op. We need your business! Despite the construction, there is always unimpeded access into and out of our parking lot.
As announced last week, the Annual Owners Meeting will be Saturday May 6th. There will be 5 seats up for election on the Board of Directors. We need skilled, committed owners to run for the Board. We will have more details soon about the election process. For now please be thinking about whether this is a way you may want to serve our Co-op community.
You can reach the Board at firstname.lastname@example.org .
Joel Landau, Board President
It’s been a while since I’ve provided an update to the owners from the Treasurer of the board. At the bottom of this post is a link to our certified financials for 2015 full year.
I want to begin by saying we’ve just received the final CPA certified end of year financials for 2015. I wanted to give a little narrative around some of the key factors of our 2015 financial year and then discuss a little more on what’s going on in 2016.
2015 was a year of discovery for a lot of board members, as we spent a good portion of the year reviewing our finances and understanding the Market’s operational expenses, liabilities and lack of revenue growth. Sales were flat at about $3.97m for 2015 compared to $3.92m for 2014. We maintained our margins on sales at about 33.5% for both 2015 and 2014. Management was able to reduce operational expenses by $40k (3%) over 2014, while spending more on advertising and some other repairs and maintenance.
The Market posted a net loss of $131,302 in 2015 less than the net loss of $169,742 in 2014. It was because of this loss, subsequent years’ losses, and the fact that we’re continuing to increase our liabilities as a means of financing the operations of the Market, our CPA requested that we provide some narrative against a statement of going concern about the Market (p.2). Depreciation of assets actually makes up a significant portion of our net losses ($90k for 2015). This is important because it shows that of the $131k net loss, only about $40k was cash loss.
What you’ll see in the balance sheet are that our assets are depreciating, our liabilities (primarily payables) are increasing, and our equity is decreasing. Since the operations of the store have not posted any net profits, we’re using our accounts payable to continually fund the continued store operations. While we’ve remained current with our primary debtors, we have yet to begin payments on any of the owner loans. Our short-term goals are to continue working with some of our larger debt holders to refinance or otherwise improve our ability to generate some operational cash.
In 2016, we’ve started to see some promising factors. The Board adopted a new vision and ends to begin focusing on the neighborhood around the Market to help grow sales. Along with that, management began a relationship with a new foods distributor, Spartan Nash, and began bringing in a blend of products to provide every day items at a lower cost.
Overall sales remain flat into the 3rd quarter of 2016. Continuing efforts to manage operational expenses as well as sales margin have allowed us to continue to reduce our cash losses. Preliminary 3Q16 financials show us with an almost break-even EBIDTA (earnings before interest, depreciation, taxes and amortization). Basically, we’re closer to cash neutral.
There will be more financial details to come as we move into the final quarter of 2016.
2015 Financial Statements as prepared by CPA
The Deep Roots Market Board of Directors announces the departure of General Manager Paul Griswold. Paul was tasked with helping focus on reigning in costs and starting the move towards a neighborhood focused store. After consideration about the challenges facing the cooperative, the Board and Paul agreed to separate. The store will operate with the current leadership team with Matt Mikal in charge of store operations. The National Cooperative Grocers is providing additional management support. The Board is working to identify the next steps with regards to long-term management of the store.
The Deep Roots Board of directors wants to thank all you who participated in the election process this year. We also want to thank those of you who were able to attend our annual meeting and hear directly from some of our new candidates for the Board. The voting process ended 5/21 and the final count is in! We will be seating our new members on the next Board meeting date and look forward to a prosperous year!
The new Board of Director's members from this years election are:
Sincerely,The Deep Roots Board of Directors
Deep Roots Market (DRM) is disappointed and outraged by the passage of HB 2 by the North Carolina General Assembly.
The General Assembly's actions were intended to send a message to our state's LGBTQ residents that they are not welcome here. That is unacceptable to us. DRM is committed to creating an environment that welcomes and celebrates all people.
DRM has restroom facilities that are clearly labelled accessible to anyone regardless of their gender and we intend to continue providing that service. No one should be made to fear visiting a restroom. Ours is freely available to anyone.
Furthermore, it is shameful that the General Assembly stripped the ability of local communities to set fair pay standards for their residents. As a locally owned cooperative business DRM sees itself as an economic resource for our community. We are committed to paying our employees fairly and providing a high level of benefits.
DRM joins many others across our state in condemning these actions of the North Carolina General Assembly and calls upon them and the Governor to reverse this law immediately.