ITHACA - The conservatively dressed staff and lively lute music at the Mate Factor in the Commons make it apparent that it is not a typical café. Less obvious, however, is that it is one of several local companies that utilize an alternative business model by distributing funds equally.
As many local businesses are struggling to survive in an unstable economy, alternative companies, such as co-ops, have been thriving in Ithaca.
“I think people are looking for a community feel for things, and that’s part of the co-op model,” said Pete Meyers, the coordinator of the Tompkins County Workers’ Center.
A co-operative, or co-op, is an enterprise that is jointly owned by members. These members also participate in the company through democratic means, such as voting on important decisions. This differs from the conventional business model, in which a single owner or board of directors makes all decisions.
GreenStar Co-op has been one of the most prominent local examples of this model since it opened in 1971 as the Ithaca Real Food Co-op. GreenStar currently has over 7,000 members. These members all have an equal say in company decisions and elect a 15-member board every year. This board appoints a general manager, who chooses 20 to 25 people to fill administrative positions. (Below: A sign advertising a meeting for members of the GreenStar Co-op)
In addition to participating in company decisions, members work at either the main GreenStar location at 701 W. Buffalo St. or the smaller GreenStar Oasis in the Dewitt Mall. General members receive a 2 percent discount on purchases, members who work two hours at one of the stores each month receive a 10 percent discount, and “super-workers,” or members who work at least two hours each week, receive a 17.5 percent discount.
Despite the economic crisis last year, Joe Romano, the GreenStar marketing manager, said the company exceeded its projections and experienced 5 to 8 percent growth in the last year. He said he thought that people continued to shop at GreenStar regardless of the economic downturn because traditional corporate structures and greed were partially to blame for the recession.
“Americans continued to allow businesses to make record profits for a tiny handful of individuals who held onto the money, and the country almost went down as a result,” Romano said. “In the cooperative model, you don’t have any one person making the money.”
However, GreenStar has experienced some criticism for the prices of its products. Romano said that the company is committed to paying its employees a living wage and selling fairly traded and local food, which can sometimes make prices slightly higher than competitors with less equitable policies.
“It’s very difficult to run a co-op, because they have to compete,” Meyers, of the Workers’ Center, said. “GreenStar has a hard time competing in some ways because people perceive it as more expensive, and the fact that they pay a living wage doesn’t help that.”
However, Romano says he has observed that people are still devoted to GreenStar because of its contributions to the local economy. GreenStar sells local produce and, through the co-op membership, employs many community members. (Below: The West End GreenStar location)
“I do believe that people realize that to keep the town viable, you have to support your local economy,” Romano said. “I believe that there isn’t a business in town that does that better than we do.”
The Mate Factor is not technically a co-op, but operates on similar business principles. The café is owned and operated by the Twelve Tribes. The approximately 50 members of this community live together and share all of their material goods, including profits from the café. The café has endured economic uncertainties since opening in January 2004, but the dedication of its members and loyal customer base have contributed to its continued success.
“We’re not really that concerned about the economy,” Jonathan Jedd, a Mate Factor manager, said. “We’re pretty secure because of how our business functions. We’re run by volunteers who are willing to strain through hard times and still make it.”
Heather Dube, a junior economics major at Ithaca College, makes an effort to support local businesses like Mate Factor and GreenStar so that they can grow despite the national economic crisis.
“You know that when you give your money to local businesses, you can see the effects of your contribution directly,” Dube said. “When you don’t have a typical management structure, it’s even more evident because the small-end workers receive a lot more for their time and their effort, and it goes back into the community.”
(Below: We talked to GreenStar cashier Pat Sewell about what it's like to be part of a local co-op)
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