Creative Enterprise Builds Community Health and Economy

Oakland Post, December 28, 2006

The idea of cooperative enterprise to build wealth and community is not new. In fact, Mondragon, Spain – a city that operates on a Cooperative economy -- was cited by Malcolm X as an important social and economic development model for marginalized people in the US.

Mandela Foods Cooperative was born out of a community spirit to see improved health in the community. The Cooperative took the name Mandela Foods to support the concept and plan to develop Mandela Transit Village at the West Oakland BART Station – also a community dream that will soon become a reality. A full service grocery retail store, and nutrition education center, Mandela Foods started as an idea and has evolved into a viable community business, with a strong financial and business package.

Mandela Foods follows a worker-ownership model, where those who work in the store, own the business, providing an excellent opportunity for low-income residents to build their economic security through business ownership. By employing only local residents, Mandela Foods provides low-income households in West Oakland with a mechanism with which to retain the value that the business generates within their community. A unique and important twist to Mandela Foods is that the business model also shares profits with the larger community through dollar-for-dollar matched savings accounts at the local credit union – so the entire community can benefit from a profitable and strong store.

Mandela Foods has already distinguished itself as more than a store. It is an integral part of the Oakland community. The worker-owners currently operate market booths at area senior centers and residential facilities, provide fresh foods and support to convenience stores that want to improve their product mix, and sell at area events and farmers markets. The store and those involved in building it work to meet community need for fresh, wholesome and affordable foods. Mandela Foods also has built relationships with and strives to support minority, under-resourced family farms that supply the market booths, and will supply fresh produce to the store when it opens.

“The successful worker owned cooperative model is the key to lifting people out of poverty, giving them the opportunity to increase their capital and become self-sustaining, a model Oakland needs to replicate in many West and East Oakland neighborhoods where the city historically made the mistake of concentrating poverty,” says Councilmember Nancy Nadel, a strong supporter in words and dollars.  Her office has contributed $100,000 to the project.  

Working with a non-profit partner, Mandela MarketPlace Inc., Mandela Foods is in the process of raising its start-up funding mainly through donations and grants – to minimize its debt, and give the store a stronger chance to succeed in its early years.

Mandela MarketPlace formed to support and incubate small, local business as a way to open the opportunity for low-income residents, and limited resource farmers to increase their financial and entrepreneurial security. Mandela Foods Cooperative is its first incubator business, but plans are already underway to begin support for a local restaurant, commercial kitchen and clothing boutique in the next few years.

Mandela Foods Cooperative had planned to locate at Mandela Gateway where it has been negotiating for about 11,500 square feet of space for more than a year. This location was of interest because Mandela Gateway was built using federal, state and local subsidies to provide housing and retail opportunity for low-income residents. The developer, Bridge Housing, and Oakland Housing Authority are partners in the venture.

Prior to development, OHA conducted several community workshops and found that the community wanted the retail space to support locally-owned small business – and at the ground-breaking, Oakland Mayor Jerry Brown emphasized the opportunity for local residents in the retail space at Mandela Gateway.

Since then, however, the development partners have decided to entertain an offer from a 99 Cent store to occupy the space that the community has worked hard to fill. It’s not a done deal as yet – the Cooperative will continue to seek this location as its first choice – however, the goal of improving West Oaklanders’ access to healthy food within a viable business model is not dependent on locating at Mandela Gateway. The Cooperative is pursuing alternative site locations with strong market characteristics that will allow it to fulfill this mission.

Housing the cooperative in the Mandela Gateway space would however make an important social and political statement about what redevelopment is really about – and set a model for other redevelopment, publicly funded projects to provide real opportunity and direct investment in resident entrepreneurship.

This model also opens the opportunity for supporting culturally rich enterprise that honors the ethnic and cultural diversity of our neighborhoods and slows down the unraveling of our rich cultural and economic fabric in favor of the homogeny of a franchise, profit-motivated economy.

Nadel compares the value of a locally owned food store vs. a national chain of low-cost surplus goods:  “The local, worker-owned coop retains all the profits in the community and has control over the quality of goods sold which in this case will be healthful food in a community that has serious nutritional needs.   The national chain takes the profits out of the community and provides goods that didn't sell in some other store, predominantly plastic goods that have a short life and wind up in a landfill.  There is no organic produce, likely no locally grown produce; only some stores have produce at all.”

Mandela Marketplace must raise a total of $1.2 million to open the store. The group is more than halfway towards meeting this goal, but needs continued community support to close the gap. Funding is especially time-critical as signing a lease – wherever that may be – requires a substantial cash deposit. Tax-deductible donations can be made on-line or by mail to: Mandela MarketPlace Inc., 920 Peralta Street, Oakland, CA 94607.

Mandela Foods Cooperative is hosting a New Years Eve Fundraiser at the Continental Club in West Oakland at 1658 12th St. Tickets are $25 and can be purchased on line at www.mandelafoods.com or by calling 510-681-5474.