Stroudco food hub

How it works

Principles

• Provide affordable, locally-produced food to people in Stroud


• Give producer members access to a local market at higher than wholesale prices.


• Build supportive and understanding links between producers and consumers


• Develop food culture and community strength

Aims
In providing local produce to local people, Stroudco aims to :

• Increase access to and availability of local products for all


• Work towards environmental benefit and reduce use of fossil fuels


• Reduce food miles


• Support farms which practice good animal welfare


• Increase social, environmental and economic sustainability


• Enable community building and develop food culture


• Provide practical experience and learning for members, including farm experience


• Enable people to understand how food is produced and supplied


• Encourage sharing and co-operation - and consensus seeking


• Enable people to work together democratically to be responsible for and participate in their food system


• Reduce trading through global companies by providing a local alternative


• Increase understanding of and support for the local economy and build supportive links between producers and consumers


• Co-operate with similar enterprises


• Be transparent in all its affairs


• Work on fair terms and fair prices for consumers and producers


• Provide experiences that will enable new ways of thinking, new knowledge, new skills and new ways of working for all participants.


• Enable a more capable community.

Structure

The food Hub has producer members based within 15 miles of Stroud who commit to;

• Supply food for sale at lower than retail prices


• Give 8% of what they sell through Stroudco to Stroudco for running costs, the most significant of which is the workers’ wage.


• Hold an annual event inviting consumer members to help with their work, picking fruit, haymaking, fencing, farm open day, camping, host a bring and share meal, etc


• Provide a service to other producer members such as shared deliveries, loan of equipment, loan of labour, etc. Offers to have a roughly equivalent financial value.

The Hub has 200 consumer members who

• Pay membership of £24 per year (£12 concessions)


• Build up to buying an average of £24 of food and drink per month through the Hub within 3 years.


• Contribute at least 2 hours of voluntary work per year such as food packing, farm labour, administration.

Governance

The co-op which makes up Stroudco has 2 kinds of members – producers and consumers. 

Small producers need a flexible, low cost, predictable, hassle free mechanism for marketing and distributing their produce as it becomes available. Consumers want affordable and convenient local food, and some connection to the local farmland and farmers that produce it.

The hub started with 8 producer members and 20 consumer members for initial trial trades, but hopes to rapidly grow to include 15-20 producers and up to 200 consumer households.  Expansion may in the future be through other drop off points, or sister hubs. There is already interest in copying the idea elsewhere which Stroudco is keen to support.

Restrictions to membership

There are restrictions on producer membership. Criteria have been drawn up by founding members and will be reviewed by the management board. These include strict animal welfare standards but do not require producers to use organic production methods.  See our criteria for producer eligibility.  All producers are required to provide detailed descriptions and photos of their growing/production set up.

Anyone may join as a consumer member. Stroudco will particularly work to ensure that the services are accessible to households near to Parliament School, where there are higher than average levels of deprivation.

How are decisions made?

The day to day running of the hub is done by an employed administrator.  The overall management and direction is controlled by a board elected from the members.  The board is made up of 50% producer members and 50% consumer members.  They each have one vote.  All members elect both types of board member.  The board makes decisions by consensus where possible; otherwise each board member has one vote.  The paid administrator attends board meetings.  The board deals with issues raised by the general membership.  Producers and consumers must be willing to stand for election and take some responsibility for the managing the hub as well as using it.

Legal form

Stroudco is a Community Interest Company (CIC) limited by guarantee without shareholding. This legal form was selected because:

• It was relatively simple and cheap to administer


• It has an asset lock which means that if the company is wound up, the assets go to a similar organisation.


• It allows us to trade as an entity with limited liability

The founders struggled to find an appropriate legal form. No existing model rules fitted the required structure easily, and the group did not have the budget for legal advice, so they amended the rules themselves. The CIC articles appeared the simplest template to begin with and allowed the group to easily amend the memorandum & articles of association (the legal documents) to meet their unique needs.  Let us know if you would like a copy.

The main alterations were to increase democracy and allow for shared control of the board. This included clauses which allow for:

• All members to elect both types of board member


• The board to be made up of half producer members and half consumer members


• Votes at general meetings to be weighted so that producers and consumers have half the votes each even though there are likely to be more consumers than producers.


• Members to have access to decision making if required.


• If at least 2 directors or 10 members want a decision to be taken by the whole membership, a discussion and vote will be arranged by directors for all members.


• Decisions to be taken by consensus where possible

The principle behind these alterations was to set up a group where producers and consumers worked for mutual benefit, seeking shared solutions, with neither seeking to profit from the other. The early signs are that co-operation between producers and consumers has been very good.

Members’ agreement and secondary rules

There are membership agreements for both producers and consumers. These contain most of the trading rules and are simple to update and alter. The memorandum & articles are difficult to alter, requiring votes or abstentions from 50% of members.

The membership agreements do include some items that are relatively difficult to alter but not fundamental to the business e.g. to ensure animal welfare for meat and dairy produce traded.

Finance

Stroudco has received two Rural Enterprise Gateway grants of £1500 each, and an Awards for All lottery grant of £8750, all for initial development work.  In May 2009 Stroudco was awarded £63,073 of Local Food Funding to cover set up costs and the loss the enterprise is forecast to make until it reaches a level of trading that breaks even (estimated to take up to 3 years). Once the enterprise is established they do not expect to require any ongoing grants.

Once established, income will be generated from 2 sources – consumer members pay £2 per month membership, and producers pay a fee of around 8% of gross sales through Stroudco. The board will adjust this rate as necessary to maintain viability, ensuring they make neither a loss, nor an excessive surplus.  Profits could be used to buy equipment for members to share, pay a bonus to the worker or support new hubs to set up.

Let us know if you would like a copy of the cash flow forecast.