Small-town co-op 1, big bank 0
A Middle Musquodoboit co-op threatened with foreclosure late last year has paid off the outstanding loan and is now focused on building the business back up, the manager says.
The Royal Bank started legal action against Musquodoboit Valley Co-op Ltd. last November, alleging it was owed $422,000.
RBC seized the 78-year-old co-op’s trade accounts, according to CBC reports. The bank also took another $2,200 in funds set aside for Christmas Daddies and other charities.
Co-op manager Terry Parsons said Monday the store worked for four months to arrange financing and finished paying off the debt in March.
“It was a long struggle but we got it paid off,” he said. “We didn’t owe them $422,000. In the end, it was about $200,000.”
Payments were made using money in the co-op’s bank account, as well as new financing, Parsons said.
The co-op is now a customer of Credit Union Atlantic.
The co-op manager said the store continued to operate but the financial turmoil did have an impact on business. He said inventory had to be reduced, as did store hours, to cut costs.
The store includes grocery, hardware and farm supplies.
However, membership actually grew by 60 after the foreclosure threat surfaced. The co-op now has 1,585 members, up from 1,525.
“The most important thing is that we didn’t lose our (customer) base,” the manager said.
The store also employs 15 people, most of them part-time employees.
Parsons said the co-op has started increasing its inventory and will continue to do so.
“It’s a long road back,” he said. “It’s never positive when you’re fighting that kind of a fight. But it’s starting to settle down and business is starting to return.”
The co-op, which won a Nova Scotia Co-operative Council innovation award last year, has other plans to boost business, the manager said.
For instance, it has a Facebook page that features in-store specials and also lists community events and news. The store will also soon be launching a website.
“We’re bringing the co-op back to the centre of the community, only more modern,” Parsons said. “We do the electronic, plus we do the personal. We make phone calls; we have mail outs. We get to know all of our customers and they get to know us.”