FY2020 ran from July 1, 2019 through June 28, 2020 and had an unplanned operating loss of $1.4 million dollars. Our sales were under budget by $2.1 million and our expenses were greater than our budget, both due to COVID-19. Your Co-op did receive a Personal Paycheck Protection (PPP) loan in April through the Small Business Administration based on two and a half months of wages and benefits. These funds provided the cash needed to:
- pay for wages and benefits to keep our retail stores open
- expand labor for our online delivery and pickup service
- re-open our Production Kitchen
- offer a limited time hazard bonus to our employees at the retails and the Kitchen
Between the needed, short-term infusion of the PPP loan to help get through the last six months and our regular budgeted expenses, your Co-op may be able to get through FY2021 without another major unplanned loss, particularly if most or all of the PPP loan is forgiven.
The safety of staff and customers continues to be our top priority. Our next priority is the financial health of our Co-op. The Co-op’s goals are to keep all of our locations open and have adequate cash to pay our obligations including payroll, vendor payables for the products we sell, and debt payments to Owner Bond holders and Summit Credit Union. The future economic outlook is uncertain and the recovery will be slow and extended, so we need to much more closely monitor our expenses and align expenses with current sales revenue—all while the COVID-19 pandemic continues in our community.
More details will be available in our coming FY2020 Annual Report. We also reviewed our financial health during our virtual Annual Meeting in July; minutes of the full meeting with preliminary financial reporting is archived here.
So what does this mean? We have seen tough financial times before, and we have had to make some hard decisions to support the long term health of the cooperative. We need to review areas of our operation to see how to manage expenses to sales. Our mission statement directs us to be an economically sustainable grocery business, and we will be.
Thank you for your continued support and being part of the journey; we would not be here were it not for you.
–Anya Firszt, General Manager
