Varying thoughts on the demise of a successful worker's co-op

[swag]

Economist Mark Thoma has a great post on the devolution of Burley Bikes in Eugene, OR, wherein he pulls from

Andrew Leonard at Salon:

Eleven years ago, ... I bought myself a mountain bike and a Burley Trailer to tow my 1-year-old daughter around Berkeley, Calif. The Burley wasn't cheap, but its striking blue and yellow colors were, and still are, a familiar sight around the Bay Area. And it's held up well -- my ex-wife still uses it to transport groceries and other vital necessities around town.

I did not know until today, however, that for 25 years Burley had been a worker-owned cooperative in Eugene, Ore. I say, "had been," because I also learned today, via a link from Treehugger, that in June, after three years of mounting losses, Burley converted itself to a private corporation. Then, on Sept. 11, a local businessman bought the company. Already, some 40 employees have been laid off and more will probably follow.

It's easy, especially living in Berkeley, where memories of the infighting and squabbling that doomed the legendary Berkeley Co-op 20 years ago still linger, to hear the words "failed worker-owned coop" and start pointing fingers at some inherent flaw in collective management. New owner Michael Coughlin alluded to exactly that, in the most mild of ways, when he told the Eugene Register-Guard that "I think it is a great business. I just think that they really had troubles adapting to competitive issues and keeping their product costs under control. I think managing a business in a very competitive arena is not well suited for a cooperative structure."

What exactly would that competitive arena be? How about competition from Taiwan and China, pumping out cheapo bike trailers currently on sale at your local Wal-Mart or Target? It's tough out there... But it seems a little unfair to pin the blame for Burley's woes on its co-op structure. As former employee Patricia Marshall writes in a moving requiem, there was much of value to be cherished in 25 years of worker-owned operation. And as plenty of other business owners can attest to, you don't have to be worker-owned to be vulnerable to the challenge of cheap labor and the Wal-Mart effect.

. . .

and from Patricia Marshall, who worked at Burley:

It's easy to point the finger at the cooperative structure, to see the dissolution of the cooperative as vindication of the idea that co-ops are an unworkable way to manage a business. But to do that is to ignore the fact that it did work, and the company prospered for more than two decades, supporting local families and turning the wheels of local commerce, all the while adhering to the democratic idea that the member-owners had equal say in the company direction.

[htuttle]

1. The worker coop I'm at has been around 27 years

We've made more money each year the last few years, though we have seen tough times in the past.

Worker cooperatives definitely are a workable model, though. Not all national governments work out either, but that doesn't necessarily lead people to give up on the whole idea of nation-states.

As one of our long-time members has been known to say, "Nobody said it would be easy." Democracy is hard (else it is corrupt).

[niallmac]

2. Anyone familiar with WINCO supermarkets set up?

My understanding is that it is worker owned. It certainly is successful here in Boise.

[swag]

3. Interesting about WinCo

"WinCo is employee-owned, having been purchased from founders Ralph Ward and Bud Williams by the workers' pension plan in 1985."

http://www.bizjournals.com/eastbay/stories/2002/07/29/story1.html