Companies considering co-op
FARGO -- Some Pride of Dakota members are looking into putting together a statewide cooperative to help sell their products to retailers by acting as a distributer.
Currently, retailers contact Pride of Dakota companies directly. The co-op would allow stores to stock up many products at once.
Pride of Dakota is a program administered by the North Dakota Department of Agriculture that helps promote businesses with products produced or manufactured in the state.
Marlo Anderson of Awesome 2 Products in Mandan is one of the Pride of Dakota business owners spearheading efforts to create the co-op.
He said he contacted more than 20 retailers from around the state that don't typically carry Pride of Dakota products and they said a distributor would make them more likely to order them.
"I heard the same common theme," Anderson said. "They'd love to carry Pride of Dakota products, they just don't want to deal with so many vendors."
A steering committee has commissioned a feasibility study to research whether the co-op would work.
The group won a $12,000 grant through the Commerce Department's Agricultural Products Utilization Commission for the study. Between 40 and 50 Pride of Dakota companies also kicked in funds.
Results are expected in mid-March. The Dakota Cooperative Association steering committee will then vote on whether to move forward with the co-op. Anderson said some parts of the co-op could be operating in the last quarter of this year.
If the project moves forward, organizers plan to open a distribution center with a retail store. The location is not yet set.
Pride of Dakota members would pay to be part of the co-op, which would buy products from them to sell to retailers.
"We'll start in North Dakota and then work regionally and hopefully we'll move out from there," Anderson said. "Cooperatively we'll be able to open a lot more doors."
Greg Kempel, who owns Maple River Winery and Maple River Distillery in Casselton, said he doesn't have the staff or time to market on a broad scale.
"Running a small business, we don't have opportunities that large corporations do to market outside of our trade area," he said. "(The co-op) is going to open up a lot of new potential."
Danette Nicoloff, who owns The Chocolate Frog Gift Shop in downtown Fargo, carries more than 40 products from at least 15 Pride of Dakota companies.
"They're my best-selling products, by far," she said.
She said she doesn't think a co-op would change the way she does business.
Chuck Fleming, marketing coordinator for the North Dakota Department of Agriculture, said many companies struggle with marketing and distribution and the cooperative could help with those issues.
Another feasibility study, done at least 10 years ago, showed that a co-op was not viable because it could not reach the sales volume required to make it sustainable, Fleming said. He added that Pride of Dakota has grown significantly in the last 10 years.
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