Board of Directors Meeting Minutes: November 2019 |

Brattleboro Food Co-op Board of Directors

2 Main Street, Room 130, Brattleboro, VT

Meeting Minutes: Monday, November 4, 2019

Directors Present: Jim Barker, Mary Bené, Anna Edson, Judy Fink, Skye Morse (via Skype), Beth Neher, Tamara Stenn, Arion Thiboumery, Jerelyn Wilson

Staff, Shareholders and Others Present: General Manager Sabine Rhyne; Board Administrator Sarah Brennan; Finance Manager Ken McGee (via Skype, for Item #6), Marketing and Community Relations Manager Jon Megas-Russell (through Item #4); Shareholders and staff members: Sheila Adams, Donna Lee Amerman, Kobey Shwayder, Denise Glover, Grace Koch

The meeting was called to order by President Beth Neher at 5:15 pm.

Meeting Opening: The meeting opened with guests stating what they would like to get out of this meeting, and all sharing what they would like to come away from the Annual Meeting with. Themes: sense of community, and opportunity to move forward on pressing issues such as our discount structure.
Agenda Review: Note: the vote count following the election will take place on December 1^st.
Approval of Minutes: Judy moved to accept the minutes of the October 7, 2019 meeting; Jerelyn seconded. The motion to accept the minutes with some minor corrections passed unanimously.
Shareholder Input and Board Tabling:
1. Jon reviewed October feedback stats. Grocery and Dairy are the departments most able to be flexible and quickly responsive regarding adding or trying new products. When we don’t have contact info for a comment, we write up our response and post it in the café. Complaints about pricing are relatively sparse. Our motivation for tracking and responding to feedback more comprehensively and quickly: building relationships and trust with our shoppers, which in turn generates more sales.
2. Skye and Anna’s tabling experience was overwhelmingly positive. We may start publicizing some of our direct dial numbers more, such as the Deli’s, for people to call in lunch orders for pickup.
GM Report: Discussion focused on the following:
1. The difficult start to the second quarter. We’re starting off with sales a little behind, and expenses are starting to ratchet up because we’re getting into the holiday season. While the Truckload Sale did well this year, leading to a surge in Bulk sales, other departments’ sales have flagged.
2. The NCG participation agreement will be going out by the end of December. It consists of the overarching agreement, with various sub-options, including the UNFI purchasing agreement; Co-op basics; Field Day; professional development; sustainability goals; and access to various contracts, including supplies, inventory (not available here), and customer feedback surveys.
3. Recent tensions between the union and management: things are settling down a bit. There are still some grievances in play, one of which (the one related to recent layoffs) will be addressed in an arbitration session scheduled for February.
4. HR Manager/Data Administrator hiring update: we are exploring recruitment opportunities for both positions.
5. Cash: we breached 500K on the cash graph.
GM Monitoring Reports: Anna moved, and Jerelyn seconded, to approve the QII 2 Financial Conditions and Activities Monitoring Report. (Ken was brought in via Skype.) Discussion focused on the following:
1. Sabine noted that this monitoring report was based on Q1 financial statements that were subsequently revised due to the CPA’s review of last year’s financials. While the review did not affect Q1 sales, cost of goods, or other expenses, it did result in some changes on the balance sheet and hence some of the ratios. She will update the report accordingly.
2. Ken described the CPA’s adjustments. The accrued amount of paid time off (PTO) from last year’s balance sheet can be taken as a deduction in this year. (Similarly, this year’s accrued PTO amount can be deducted next year.) Due to a lot of PTO having been accrued the previous year, we were hit with an additional 99K in taxable income for last year. This was partially offset by our ability to take accelerated depreciation. The overall hit on our bottom line was (55K). Board members were provided with revised first quarter financials and the packet will be updated on the Board’s website to reflect this. Some ratios changed as a result: The current ratio went from .56 : 1 to .57 : 1, and DSCR went from .3 to .5.
3. Sabine noted that even with the various adjustments, we did not make it to plan as far as sales and margins. We were able to keep a lid on it by being careful with expenses, sometimes unwillingly, as with the open positions in maintenance and security that management had to cover. We’ve been lucky so far this year with health care expenses: we have not experienced as many claims so far.
4. Joint Liability Fund: This fund was set up about ten years ago to protect the whole if an individual co-op goes down. We had been paying $30K/year into this fund and were able to negotiate a cap in January of 2017.
5. Sabine will be scheduling a series of meetings to walk interested staff through the numbers.
6. Jerelyn moved, and Mary seconded, to amend the motion on the table to reflect that the CPA adjusted the financial statements. This was accepted by the Board.
  The motion to accept the QII 2 Financial Conditions and Activities Monitoring Report, which will updated to include minor changes reflecting the CPA’s adjustments to the financial statements, carried unanimously.
Board Perpetuation
1. Upcoming Dates and Deadlines: 11/15: Annual Meeting; voting begins then and runs through 12/1 @ 5 pm. 12/2: regular Board meeting (Beth to notify newly-elected members). 12/7: Board Retreat. 1/11/20: Columinate’s CBL 101. November tabling: Jerelyn and Jim. December tabling: Mary and Tamara.
2. GM Monitoring Report: Jerelyn moved, and Arion seconded, to approve the Q1 – Ends Monitoring Report. Sabine noted that the Board is embarking on process to assess and possibly modify our Ends Policies. Discussion covered the following points:
  End #1: Local and organic sales in the Deli are on the rise, due in part to tighter collaboration with area farmers. We’ve lost a little ground in pricing over the past year. We have data quality issues with Fair Trade sales, but with over 34,000 SKUs in our system, we are prioritizing sales over data clean-up. Price comparisons: this will be shared in an upcoming FFT article. Note: any accompanying graphics should be re-scaled. Gross margin average: We will learn soon whether we qualify for the next level of price break with UNFI, which could potentially improve our margin. We’re also exploring reducing or removing the stacked discounts in other promotions, special orders, or both.
  
  End #2: Discussion focused on the Food for All program and shareholder assistance scholarships: how they’re publicized and what the process is.
  
  End #3: No substantive comments.
  
  End #4: We believe our landfill numbers are probably not as bad as it appears, due to fuzzy reporting from our vendor.
  
  End #5: We are involved with community groups in ways that can’t always be captured with a dollar sign.
  
  End #6: Discussion focused on which media outlets we focus on. Our sandwich boards have the best reach of any kind of marketing we do.
  
  End #7: We expect feedback to increase dramatically due to both the receipt survey program and our efforts to respond to all feedback promptly.
  
  The motion carried unanimously.
3. Annual Meeting: A sign-up sheet for helping set up, run, and clean up afterwards was distributed. Jerelyn continues to recruit various shareholders to participate in the panel.
4. Annual Retreat Agenda: Beth will distribute this once it’s been finalized. The framing questions will be why we do this work, what is our work, and how do we do this work. Expect some reading.
5. Preparation for December board monitoring: Policy QIV 8 Board Perpetuation, Election and Orientation of New Members. Departing Board members Jim and Arion are asked to do that monitoring report, since newly elected board members won’t be able to.
6. Board Officer Slate: Beth will be in touch with the Board member who has expressed an interest in serving as Secretary, and will email a final slate to members in advance of the next meeting, when the slate will be voted upon.
7. Board Candidates: We have two open slots, each for three-year terms, and two candidates. The deadline to submit materials for candidacy is two weeks before the Annual Meeting (November 1^st, this year.)
8. Board mentoring of new members: Mary and Tamara offered to serve as mentors.
9. FFT articles: Anna is doing December’s. Mary will write January’s article (due 12/6), perhaps a recap of the annual meeting. Tamara will write February’s article (due Friday, January 3) about the annual retreat.
Committees
1. Shareholder Engagement: The committee is seeking comment on a proposed set of guidelines for the tabling packet.
2. Policy and Bylaws: Notes from a 10/28 committee meeting were distributed. The packet will be updated on the website to reflect this. The Board suggests that sharing bylaws with new shareholders (as called for in the bylaws) be done via a cover sheet with a URL, rather than printing them out. Jerelyn will follow up with Jon about this.
3. Recruitment Committee: Has focused recently on how to ensure that Board terms are staggered by opening up both open seats (each of which has one or two years remaining) to full three year terms.
4. Ends Process Taskforce: Notes from a recent meeting were distributed. Ends will be discussed at the Annual Retreat.
5. Discount focus groups continue. We’ll be assembling and sharing all of the comments received so far.
Meeting Outcomes: Board members shared what they would tell a shareholder about this meeting.
The meeting was adjourned at 8:40 pm, followed by a celebration for outgoing board members Jim and Arion.