Valley Natural Foods Rings in 35 Years of Food and Fellowship

The venerable co-op has survived two recessions, one fire and plenty of change, and its growth has never been better.

One cold January day in 1989, Susan McGaughey lifted her eyes to a jagged, black hole where the ceiling of the Valley Community Food Co-op had been.

"We were on the lower level and you could see blue sky above," McGaughey recalled.

All around her, were the scattered remains of the small natural foods grocery, the result of hours and hours of volunteer labor. The night before a fire had torn through the strip mall at Colonial Ridge, taking almost everything the co-op had. All the inventory was ruined and the basement space where the shop had been was a total loss. 

But what seemed to be a fatal blow became a transformative moment for the co-op, which celebrated its 35th year in 2012.

"It was really devastating in one way, but it was also a blessing in disguise. We were in the lower level on the backside of Colonial Ridge and we'd talked about going someplace else and becoming more visible, growing," said McGaughey, the general manager. "It forced us to get up out of the basement." 

McGaughey keeps a smoke-stained box of staples salvaged from the fire in her desk at Valley Natural Food's shining new location as a reminder of how far the co-op has come.

The south metro's only natural food co-op started small, with a shoestring budget and an all-volunteer staff in 1977. The nascent co-op was started by a group of mothers, who fell into two camps. Some were searching for food without coloring, preservatives or additives for their children, many of whom were on the Feingold Diet. Others were concerned with the environment and reducing waste produced by food packaging. 

McGaughey chanced on the group shortly after moving to Apple Valley, at a welcome wagon luncheon where the co-op's first members were selling coupons to raise money for their first inventory and the lease. She bought some coupons, and before long she'd become a volunteer herself at the first iteration of the co-op, then known as Valley Community Food Co-op. The tiny bulk food store in Lakeville included five gallon buckets of grains and beans, with the labels scrawled on top, and an old refrigerator for cheeses.

It was open just two days a week, but the store quickly gained a devoted following through word-of-mouth. The co-op had a particular emphasis on education.

"We were teaching each other how to do things. We taught each other how to bake bread, how to core an apple, make yogurt, and how to cook with tofu," McGaughey said.

In 1978, the co-op relocated to Nicollet Avenue in Burnsville, and in 1980 the group celebrated the completion of an expansion project at Colonial Ridge shopping mall. It was there, in the basement at Colonial Ridge, that the group quietly pushed products and practices that are only now becoming common. McGaughey, for instance, remembers when interest in organic farming was just taking root in the late 1970s and 1980s. She credits VNF and its co-op compatriots with the spread of organic practices.

"I really believe that the co-ops throughout the nation were the ones who really pushed organics and educated them about organic growing. I can recall that managers in the Twin Cities as we got together to talk about the future and what would it look like if we were successful with this," McGaughey said. "One of the things we said was that organics would become mainstream. Well, it basically has now." 

Still, the 1989 fire proved to be a fateful turning point.

"It was an impetus to not only get a new location, but to make the transition from a volunteer-based workforce to a full-fledged business with employees and member ownership," said Erin Erickson, promotions and education coordinator with the co-op.

At the time, volunteers built "sweat equity" at the co-op: Each person became a member for $5, and for each quarter worked they could earn a discount for the next quarter. The store had outgrown the "sweat equity model" but previous efforts to switch to a stock equity system had failed.

"Between 1977 and 1989 there was just that much change in the economy. At the time (the co-op started) there were a lot of people who were able to volunteer, but by 1989 there were fewer and fewer mothers who were at home that would be able to come during the day and volunteer," McGaughey said.

The co-op needed full-time employees and capital to keep pace. In the wake of the fire the argument for a stock equity system proved to be a persuasive one. The members opted for the new model ($100 for a membership, which included four shares in the company), a new name and a new location visible from Interstate 35 on Grand Avenue. For the next 11 years, the co-op prospered and grew more sophisticated: The new location included fresh meats and produce in greater quantities.

Finally, in 2000 the co-op was able to buy land of its own. VNF purchased from property from the Dakota Electric Association on Burnsville eastern edge, and built their current location, which includes two gardens, a cafe and a full-service deli. The co-op has also broken into the wholesale business: VNF operates a gluten-free bakery off-site, an operation that is expected to grow as demand for wheatless products picks up.

The co-op now has about 10,000 members.

"The huge growth has been exciting to watch," McGaughey said. 

Success can be a double-edged sword, of course. Large, corporate grocers are now adopting products and practices perfected by co-ops, which puts added pressure on independent grocers like VNF.

"Every store carries something organic now," Erickson said.

"While that was good for the planet, good for people, good for health, that certainly puts a whole new level of competition on us," McGaughey said. "But those were was the values that we wanted to push out."

To keep up, VNF puts an emphasis on research and development (finding the perfect recipe for gluten-free bread, for example) and takes care to cultivate relationships.

"We work really hard to be authentic. We have face to face individual relationships with many of the farmers," McGaughey said. "It's good for us to know exactly where the food comes from."

"People who come here feel like one of the family. Some people grew up with us," Erickson said. "They feel like they're part of something. You actually have a voice in what we do here and we listen."


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