$ 2.5 million expansion planned for Bay View outpost: The Bay View Compass
By Katherine Keller
Fbuckle up your seat belts. The Outpost Natural Foods Co-op store in Bay View is gearing up for major expansion and renovation.
The Bay View store, the co-op’s third location, opened in 2005, leasing the 24,000 square foot property, 2826 S. Kinnickinnic Ave., in a former Kohl’s grocery store. The building was remodeled to house the 8,000 square foot retail business, community meeting room, central kitchen, garage, warehouse and branch of the Brewery Credit Union. It was renovated in 2013.
Last year, the co-op’s offices moved from downtown Milwaukee to South Third Street and East Oklahoma Avenue, renting office and warehouse space.
Scheduled to begin in January 2022, the $ 2.5 million project will expand the store by 50%, spanning a 4,000 square foot space that opened when the bulk packaging operation was closed. moved to Third Street. Bulk goods are distributed to the four stores, Bay View, Riverwest, Wauwatosa and Mequon.
Another 200 square feet became available last year when Brewery Credit Union moved to another location on Kinnickinnic.
Outpost’s board of directors authorized a loan of $ 2 million to finance the project. Waterstone Bank in Wauwatosa is its lender.
Outpost’s board of directors hopes to raise an additional $ 800,000 by offering its preferred shares (class 2 shares). In 2013, Outpost registered over one million Class 2 shares with the State of Wisconsin. That same year, Outpost sold $ 540,000 of its stock to fund a new store in Mequon, its fourth location.
Managing Director Pam Mehnert noted that the board will borrow less than $ 72 million if its stock sale is successful. In the third week of September, the sale brought in $ 325,000. The board of directors also recalls the shares it sold to finance the Mequon store. The sharing campaign runs until the end of October.
Mehnert noted that in each of the seven years since the issuance of the shares, the board of directors has voted in favor of a 4.25% dividend. The new dividend will be 3.25%.
The 2013 Bay View store remodel was fully funded with cash reserves.
What will change?
Some departments will be moved, some will remain in place but will expand, and others will be new.
The dairy department will be relocated to the north side of the building in a former warehouse. The dairy and frozen food sections will be expanded.
The meat department will be moved to the alcove currently dedicated to the bulk department.
“The demand for bulk compared to five years ago has decreased,” Mehnert said. “Does that mean we would stop selling in bulk? I don’t think there is a chance that this will ever happen. I mean, it’s like a trademark of the co-op. This is where we come from. Whether a small percentage of the population thinks that way, people (still) buy that way. I am one of them. I can feel it very strongly. I want to control the packaging. I want to control the amount I buy and the freshness of the product I buy so I want that choice.
The new floor plan includes a new section for cheeses and another for alternative meat products.
The dishwashing area in the central kitchen, where sandwiches, cold cuts and baked goods made by Outpost are produced, will be expanded and an additional hood will be installed to accommodate an additional range of cooktops.
The beer and wine inventory will double, both in refrigerated products and on the shelves. This section will not be moved but will be extended to encompass the entire length of the aisle. Of its four stores, the largest volume of beer, wine and liquor sales is Bay View, Mehnert said.
Staff and product supply shortages prompted Outpost to close salad bars at all four stores last month. After being absent for months during the pandemic, salad bars have briefly reopened this summer with permission from health authorities. This time around, a shortage of Outpost employees and surprising inventory shortages at its main supplier are to blame. Stores like Outpost and Whole Foods rely on the same large national health food supplier.
“The problem is work, nationwide,” Mehnert explained. “I’m going to use Annie’s (organic food producer) to illustrate. Their product could be on a truck outside of a warehouse, but the warehouse does not have the staff to unload it. When they finally asked the staff to unload it, there were no warehouse staff left to pack the orders.
“Our orders with our main supplier have been reduced by more than 50%. For example, we can order 800 cases in total, but we will get 300 cases. I’ve been in this business for 41 years, and nothing like this has ever happened before.
“So right now the good thing about a local food system is that our local food supply doesn’t have the extreme problem that the national food supply system has. We get deliveries from Kallas Honey, Eastside Bakery and everyone else, and they are reliable. “
Still, Outpost relies on local growers to supply greens and fresh vegetables, and the growing season will soon be over. “We will again have to depend on the (national) supply system and this is where the challenges come in,” she said.
Fully staffing its operations is another challenge. Outpost employs a total of 362 full-time and part-time employees and of these, 90 positions are at the Bay View store. 35 other employees work in the central kitchen. Outpost was unable to fill all of these positions.
“We have increased our salaries like everyone else. The warehouse where we buy is in Racine. Amazon is in Racine and Uline is in Racine. There’s this conglomerate of giant warehouses over there. They post jobs that start at $ 18, $ 22 an hour, and they can’t find people at $ 18 and $ 22 an hour. This is for me, wow! Mehnert exclaimed.
“Every little bit of supply is broken right now, and they predict it won’t be resolved until at least 2023. People are changing careers. They say, I’ve had enough and I’m not doing this anymore. restaurants are shortening their hours because of that, or the days of the week they’re open. It’s just another thing.
Following the expansion, Mehnert expects sales growth of around 8% and the creation of around eight new positions. “I hope we can fill them. And I hope there is some product to put in the larger area, ”she said.
The Bay View store will remain open during all phases of the expansion. Work is expected to begin in January, although Mehnert has only indicated whether the new equipment ordered has been delivered. The project is expected to be completed in November 2022.
Outpost cut its hours during the pandemic. Decisions to revert to the old, longer hours, store by store, will be based on the advice of Outpost staff. Are customers asking for the store to open earlier? Did customer traffic increase in the early evening, justifying staying open longer?
Mehnert started her job at Outpost in 1980, starting as a part-time customer service employee. At that time, the co-op’s only store was located on North Holton Street in Riverwest. She has held various positions including creating bulk bin labels and wall signage. She was promoted to general manager in 1986.
Currently, there are over 23,000 members of the Outpost cooperative. Membership is not required to shop at the cooperative. Owners have the right to vote and while Wisconsin residents can buy Outpost shares, members make up 72% of Outpost buyers.
Mehnert said total sales for the current fiscal year, which is nearing its close, are around $ 46 million.
Bay View’s sales revenue is the largest, overtaking the other three stores.
In an email to its members, Outpost featured news of its expansion and preferred stock offering with the tagline “Here We Grow Again”.