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CO-OPS SURVIVE WITH DIFFERING APPROACHES

It's been a struggle, but member-owned cooperatives have found various ways to survive over the past 50 years.Although their numbers have shrunk by about a third over the last decade, the 25 surviving retailer-owned co-ops do a combined annual volume of just over $50 billion.Two of the most consistently successful have been Wakefern Food Corp., Elizabeth, N.J., in the Northeast and Los Angeles-based

It's been a struggle, but member-owned cooperatives have found various ways to survive over the past 50 years.

Although their numbers have shrunk by about a third over the last decade, the 25 surviving retailer-owned co-ops do a combined annual volume of just over $50 billion.

Two of the most consistently successful have been Wakefern Food Corp., Elizabeth, N.J., in the Northeast and Los Angeles-based Unified Western Grocers, formerly Certified Grocers of California, in the West -- both of whom have been able to keep traditional wholesalers out of their primary operating areas.

"Both companies secured an enormous foothold and both were well-entrenched, so they've been able to maintain their positions in their respective marketplaces while keeping Supervalu, Fleming and the other giant wholesalers out," one observer said.

But each company has gone about it a different way.

Wakefern's way has been to develop a store base with common operating standards and a common banner -- ShopRite -- that enables members to deliver a common advertising and promotions program on par with any chain's; in addition, the advantages of individual store ownership enables each operator to reflect the needs of his own community.

On the West Coast, Unified has consistently weathered the loss of member companies over the years -- as they got larger and moved to self-distribution -- by adding more products and services and gradually expanding from its Southern California base into Northern California, Hawaii, Arizona, Nevada and, through a merger with United Grocers, Portland, Ore., in 1999, into the Pacific Northwest.

Associated Wholesale Grocers, Kansas City, Kan., has been able to thrive over the years by offering a variety of retail formats.