Cootamundra shoppers can expect good value at the new Coota Co-op due to take over from Target after it closes in March next year, it was revealed at a public meeting at the Ex-Servicemens Club on Tuesday evening.
Members of the Co-op steering group told more than 80 people at the meeting that clothing, shoes and manchester for the new store will be obtained from Frontline Stores, a Melbourne-based retailers association that gets substantial discounts from suppliers due to its strong buying power.
If the Co-op develops as expected, the closure of Target could turn out to have a silver lining for Cootamundra.
Profits from the business, instead of going to fund the top-heavy administration costs of Target's parent company, Wesfarmers, could go back into the community, with part of the profits going to support local groups and education initiatives.
The arrangement with Frontline, which operates from offices in the Melbourne suburb of Canterbury, will ensure that items for sale at the Co-op will be of comparable quality and cost to the merchandise currently available at Target.
However the Co-op will not sell merchandise already being sold by other businesses in Cootamundra, with the range of stock being kept along the same lines that are currently available at Target.
Australian-made goods will be obtained when they are competitive, but special attention will be paid to overseas-made goods to ensure ethical manufacture.
A member of the steering group, Donna Streher, informed the meeting about the results of a community survey conducted in recent months, to which 204 residents had responded. Among other things, the survey had overwhelmingly favoured the name "The Coota Co-op".
The exciting news about the access to buying power through Frontline was among numerous interesting developments outlined to residents at the meeting, which was attended by Cootamundra-Gundagai mayor Abb McAlister, who congratulated the community on the initiative.
Details have been summarised in an information sheet now available at the Cootamundra Development Corporation (CDC), which has played a key role in assisting the new venture.
Also available at the CDC in Parker Street is a form for people to register expressions of interest in becoming a Co-op member, and also to enable them to pledge how many shares they might like to buy.
The steering group of ten volunteers has been meeting regularly every Wednesday night since August 27.
Steering group member Todd Basham reported that the group had received a letter of offer to lease the building from its new owner, an individual whose identity cannot yet be announced.
On financial matters, another steering group member, Richard Turnbull, outlined that Co-op membership would be available to all comers for $20, qualifying them for a members' discount on purchases.
Mr Turnbull said the Co-op would be run as a for-profit business, owned by members who buy shares, available for $100 each.
The $100 share price, he said, had been fixed to allow people to buy an interest whether or not they had "big money".
A maximum of 20,000 shares will be available, but no one member will be allowed to own more than 20 per cent of the business, to conform with international co-operative rules.
Further, voting power will be with members, each member having one vote regardless of how many shares he or she owns. This is also accordance with international rules.
The steering group has calculated that the business will need a minimum capital raise of $750,000 to buy stock, employ staff and pay rent.
Members of the current Target staff will not be able to work for the Co-op for a period of three months, but it's expected there will be an interval of some time between Target's closure and the new business opening its doors.
An application for approval of the business by the NSW Department of Fair Trading could take until March or April to be approved.
"We can't sell shares or take memberships until we've got that approval from the Minister," the meeting's chair, Leigh Bowden explained.
"Approval by the Minister would be quicker if the Co-op was a non-distributive (not for profit) business, but we have applied for a distributive business registration, meaning that shareholders can expect dividends to be paid.
"There probably won't be dividends for about five years, but we believe it will pay more than bank interest."
The meeting was also attended by Craig Sinclair, economic development officer at Temora, and Mel Gallard, chair of the Temora Business Chamber and two other Temora residents.
There is no requirement for members or shareholders to be residents of Cootamundra.
"We've had inquiries whether a family from Sydney can become members," the meeting chair, Leigh Bowden said.
"The answer is absolutely - we welcome everybody."
A board of directors cannot be appointed until approval is received from the Minister, and the Co-op can be formed, Mr Turnbull said.
"Once the Co-op is formed, it will be registered with the Australian Securities and Investments Commission (ASIC), and will then be able to collect money.
"At the moment there's no legal entity to collect membership or shares, but we're asking members of the community to show their support by pledging money that they can invest."
With regard to the appointment of a Board, Mr Turnbull said the process was that the application goes in, with a draft set of rules and draft disclosure statement for approval.
"Once they are approved there will be a meeting to form the Co-operative, and the initial Board will be set up for a period of a year, and in that year's time that will ensure that the Co-operative gets started and running.
"Then there will be elections for Board members in that time.
"The initial Board members may not necessarily stand for positions on the Board once the final Board is formed. That's up to the individuals.
"The initial Board will be formed and once that's done their remit will be to hold elections for the permanent Board in that first year.
"What we're anticipating is that we'll have a rolling three-year Board membership similar to how Senators are voted for, so that we have continuity across the Board.
"But it will also be a Board that has appointees according to their skills required by the Board at that level.
"It will be eventually a Board of elected members and appointed members."
Sign up for our newsletter to stay up to date.