“Everything now is pretty steady.”

December 19, 2020 6:19 AM

How employee ownership helped Phoenix Coffee survive Covid-19. From The Land, a new non-profit journalism site covering Cleveland, Ohio, and its inner ring suburbs. A long piece on how a 20-year-old local coffee roaster and cafe chain Phoenix Coffee may have found the recipe for pandemic stability and post-pandemic success by becoming an employee-owned co-op (a business model comparatively rare in Cleveland and the US Midwest), with the help of co-op incubator Evergreen Cooperatives.

Bonus piece: a 2018 article from Freshwater Cleveland on the current status of Cleveland's "third wave" coffee scene.

posted by soundguy99 (9 comments total)

Gotta say that the co-op model has been working really well for Ocean Spray since 1930....
posted by EmpressCallipygos at 7:18 AM on December 19, 2020 [3 favorites]

I've been fascinated by the Co-op and B Corp directions companies have been moving toward the last few years. The idea that all members have a stake in the company they are working for seems like a more rewarding approach to employment—there seems to be a positive feedback loop when investing in one's members, who in turn want the best for the company they work at. Hopefully the concept becomes more accessible to future business owners.
posted by oneboiledfrog at 8:05 AM on December 19, 2020 [2 favorites]

This is a bit of an aside, but I'm disappointed that hydraulic economics never went anywhere. A flow-centric view of the economy, that looks at how flows differ under different ownership models (like co-op vs private vs public ownership), could be so revealing of the actual impact of an economic system in people's daily lives. Not only because flows determine how much money people make, but also because the corresponding ownership structures can mean the difference between living in a mini fascist dictatorship versus a meaningful democracy for half of your waking hours (i.e. at your job).

Co-ops really drive this home because they illustrate the extraction so beautifully. The money in most businesses, from the perspective of most workers, just... goes away. Sure, they make a wage, and some percentages might make it back in pension funds or trickle down to the yacht scrubbers but, what if income minus cost was all just money in your pocket instead?

Instead of thinking in depth about where money is going, academic economics is stuck with a fairly static view of income that doesn't really go anywhere, it just gets aggregated into Consumption or Investment, and you get a few charts that show rich people are rich and some semi-intuitive campaigns like "middle-out economics" or Buy Local. I think a clearer view of how stuff flows around the economy, if it had a lot of expert consensus behind it, could be pretty radical. Presuming that it's all just equilibria is fundamentally disempowering.
posted by ropeladder at 9:28 AM on December 19, 2020 [5 favorites]

Several employee-owned orgs that I am a determined customer of have a fundamental competence at their subject that seems to get rarer with size and vanishes under private equity. Plus also, basically cheerful employees to deal with!
posted by clew at 10:31 AM on December 19, 2020 [2 favorites]

Here in Wisconsin (and across the country), it is pretty common for the MBA's to shut down a plant that is profitable, but not profitable ENOUGH- and by shutting it down, there is a short-term goose to the quarterly profits as well that can be funneled back to the private equity vultures. I have often wondered if, instead of putting 3 billion dollars into the Foxconn boondoggle, the state instead provided financing and legal and regulatory structures to allow for workers to cooperatively purchase these factories and run them themselves.
posted by rockindata at 11:22 AM on December 19, 2020 [6 favorites]

ropeladder, if you're interested in a flow centric view of the economy you might be interested to check out stock-flow consistent models:
Obligatory Wikipedia
Brian Romanchuck's Overview (includes links to his free Python library)
Levy Institute Papers

I was really into this stuff for a while. The issue is building a model using real US flow of funds data -- it's difficult. I audited a grad seminar on this topic but we were never able to get a working model for the entire US economy. It couuld probably be done with a full time staff, but last time I checked it hasn't been done (publicly) for the US economy. I strongly suspect that the team around Jan Hatzius at Goldman Sachs may have, in fact, built such a thing privately but of course, they'll never show their cards.
posted by wuwei at 1:57 PM on December 19, 2020 [1 favorite]

I have often wondered if, instead of putting 3 billion dollars into the Foxconn boondoggle, the state instead provided financing and legal and regulatory structures to allow for workers to cooperatively purchase these factories and run them themselves.

The workers would have to cooperatively purchase tickets to Taiwan, since the lesson of the Foxconn/Wisconsin goat rodeo is: Absolutely no one wants to move their manufacturing to the US, but if various levels of the US government want to funnel tax money into the coffers of Foxconn and their friends, they will pretend to try.
posted by sideshow at 5:05 PM on December 19, 2020 [1 favorite]

I'm always telling people that things like Social Security, Medicare, and public schools have nothing to do with socialism. Sure, they're social programs, but even dictatorships will do things for there common good. Real socialism is worker control over the means of production.
posted by CheeseDigestsAll at 7:31 PM on December 19, 2020 [2 favorites]

I’m not suggesting building a coop factory from scratch, though there are absolutely places where that might make sense. In particular, the weak link in building a more sustainable meat industry in Wisconsin is that there is a dearth of small slaughterhouses.

Instead, in this case I am suggesting that the state help the workers buy and run the factory that is already there and already making money, but is being shut down for dumb reasons.
posted by rockindata at 5:35 AM on December 20, 2020 [2 favorites]