Expansions contribute to profitable year for Co-op
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- Published on Thursday, April 21, 2016
By Ken Waddell
Neepawa Banner/Neepawa Press
With sales rising in 2015 to $76.6 million and net savings of $3.3 million, the Neepawa-Gladstone Co-op had lots to smile about at their annual general meeting on April 14. Held at the VCC, the local Co-op reviewed the financial statements and honoured two long time board members, John Forke (9 years) and Ray Kulbacki (12 years).
Co-op general manager Brian Hedley said, 鈥淣eepawa-Gladstone Co-op depends heavily on the agricultural sector for the success of our operations and we are therefore dependant on the weather conditions. It was a stressful start to the season with late frosts and everyone was concerned about crop damage. However, reasonable crop yields were experienced in most of our trading area.鈥�
Looking at the petroleum part of the business, Hedley stated, 鈥�2015 has been a difficult year if you are in the oil producing business. The oil cartel OPEC decided not to restrict crude supplies this past year and a glut of oil has been the result. With excess oil in the market, the prices collapsed with crude down significantly. The upside was that many customers found the prices at the pump much cheaper than in the past.鈥�
Hedley noted, 鈥淢any departments had much improved margins over last year. With the large sales increase, this also helped to add additional margin dollars to our bottom line. Most departments did well and achieved budget, but this is not the case in all departments and some have to put a priority back into achieving budgeted margins.鈥�
On recent expansions, Hedley was very positive and said, 鈥淢arch 6, 2014 was an exciting day when we opened our new Food Store facility and then just over a year later was another exciting day, March 30, 2015, when we finalized the purchase of Eagle Agro鈥檚 ground custom application business. The public鈥檚 reaction has been extremely positive on both ventures and our customer feedback has been tremendous. Sales have been well beyond what we had hoped for with both ventures, which is extremely encouraging. Our custom application business has more than doubled in sales this past year. The new staff is a great addition to our already successful Agro Department and the transition was very smooth.鈥�
In previous years, the Co-op had some concerns with the Gladstone Farm and Building Centre, but he noted, 鈥淪ales were strong this past year thanks to renewed support by our Gladstone customer base. Declining sales and reduction of community support in this department has been of great concern to us the past number of years. Strong margins and good expense control has also led to a better year. The changes that have been made the last number of years in the lumber department have been very beneficial.鈥�
New for 2016 is the upgrading of five of Co-op鈥檚 Terragators/Rogators to brand new units. Customers will receive custom applied Co-op products by the newest in Ag-Chem equipment. Hedley said, 鈥淲ith Eagle Agro working with us and Nelson Almey鈥檚 three spray planes, we will be able to cover all your 2016 needs.鈥�
Hedley warned, 鈥淲e are very optimistic about the coming year. Although we have enjoyed success in the past, we cannot afford to get complacent and assume the success will continue indefinitely. Our competitors, many of which are large multi-national companies, continue to enter our marketplace and we must ensure that we are able to fine tune our operations so that our Member/Owners will continue to enjoy the benefits of Neepawa-Gladstone Co-op membership.鈥�
