聽 聽 聽 聽 聽 聽 At last week鈥檚 annual information meetings, the Gateway Co-op board and administration had the challenging task of explaining how it was that despite a $3 million decrease in sales due to petroleum depreciation, the Gateway Co-op actually had a financially successful year.
聽聽聽聽聽聽聽聽聽聽聽 Annual information meetings were held in Canora on April 25 at Rainbow Hall; in Buchanan on April 26 at the Buchanan Community Centre; and at the Sturgis Community Hall on April 27 for the Preeceville/Sturgis area.
聽聽聽聽聽聽聽聽聽聽聽 In the reports to the membership from Lyle Olson, the board chairperson; Dana Antonovitch, the general manager; and Heather Prestie, the office manager, the challenge was to explain the effect on sales volume by world-wide fuel depreciation, Antonovitch said.
聽聽聽聽聽聽聽聽聽聽聽 Overall, Gateway鈥檚 sales were down $3 million to $30.74 million, but that was mainly from deflated petroleum prices, Antonovitch said. 鈥淗owever, we still made the same cents per litre 鈥� profits were good.鈥�
聽聽聽聽聽聽聽聽聽聽聽 From the accounting perspective, deflated petroleum prices threw the budgeted margin out of kilter, but actual margin dollars were better than budgeted, Antonovitch said.
聽聽聽聽聽聽聽聽聽聽聽 Actually, the volume of fuel sold was up and this is due mainly to increased activity by customers in the agricultural and trucking sectors.
聽聽聽聽聽聽聽聽聽聽聽 鈥淲e sold 18,883,000 litres 鈥� an increase of 536,000 litres from 2014,鈥� said Olson.
C-store for Canora
聽聽聽聽聽聽聽聽聽聽聽 At last week鈥檚 annual information meetings, Gateway Co-op members learned that the planned construction of a C-store will commence in Canora in July.
聽聽聽聽聽聽聽聽聽聽聽 To be located just south of the food store, the 2,800-square-foot C-store will be constructed over a five-month period at an estimated cost of about $4.7 million, said Dana Antonovitch, general manager. With a far superior design and usage of the space, convenience store will replace the Canora service station.
聽聽聽聽聽聽聽聽聽聽聽 With four sets of fuel pumps on eight lanes, the design allows for easy come-and-go access so that eight vehicles can be fueled at the same time with virtually zero congestion, he said. The design also provides for the convenience of paying at the pumps with a debit or credit card.
聽聽聽聽聽聽聽聽聽聽聽 It will continue to be a full service facility, Antonovitch said. In the overall scheme of things, the C-store will not be much larger in size, but because of the much superior design, it will be able to accommodate a more diverse inventory with a greater emphasis on the convenience aspect, including more quick food choices such as sub sandwiches, coffee, beverages, and even some hot meal options. The installation of an ATM cash machine will also be added to the convenience aspect.
聽聽聽聽聽聽聽聽聽聽聽 To ensure that service will continue to be a priority, the C-store will employ about a dozen full and part-time workers under the leadership of Bryan Harder, who has been the manager for more than a year, he said.
聽聽聽聽聽聽聽聽聽聽聽 To better visualize the finished project, Antonovitch noted that Gateway Co-op owns all the lots from the Eighth Avenue East back alley south to the Heycat Service business. When looking at it from Norway Road, the food store and the parking lot are located on the north side of the parcel of land and the C-store will be located on the south side. On that parcel of land, during the first phase of construction which culminated with the opening of the food store in April of 2010, an RV dump station was installed on the west side between the food store and the proposed C-store.
聽聽聽聽聽聽聽聽聽聽聽 At this point, access to Norway Road will remain the same, but it is obvious that traffic flow will increase when the new facility is up and running, he said. Gateway will be monitoring the impact on traffic movement on that section of Norway Road to determine if changes are required.
President鈥檚 perspective
聽聽聽聽聽聽聽聽聽聽聽 When announcing the C-store project at the annual meetings, Lyle Olson, Gateway鈥檚 board chairperson, said that the project has received approval from FCL (Federated Co-operatives Limited) and it is now in the tender phase. Receiving FCL鈥檚 approval means 鈥渨e are eligible for FCL investment dollars which is 20 per cent of the value of the project.鈥�
Preeceville projects
聽聽聽聽聽聽聽聽聽聽聽 Next on Gateway鈥檚 priority list for new construction is a home centre/C-store for Preeceville, he said. That project is currently in the feasibility and planning stage. It has been on Gateway鈥檚 priority list for some years already, evidenced by the purchase of more than 10 acres of land on the east side of Preeceville (near Chris鈥� Place), close to the Endeavour turnoff on Highway No. 9.
聽聽聽聽聽聽聽聽聽聽聽 A cardlock facility was constructed at that location last year and though it just opened in November, litre sales are already far ahead of projections 鈥� almost double the projection in Gateway鈥檚 budget, Olson said.
聽聽聽聽聽聽聽聽聽聽聽 However, the heavy use of the Preeceville facility 鈥渉as seemingly affected our Canora cardlock where we are behind budget. It also is affecting our full service sales at Preeceville where we are also behind budget.
聽聽聽聽聽聽聽聽聽聽聽 鈥淲e had hoped to see an increase there when the cardlock opened. (Instead) Many of our regular pump customers are utilizing the new cardlock,鈥� said Olson.
聽聽聽聽聽聽聽聽聽聽聽 While many members from the Sturgis/Preeceville area want to see the home store project come about sooner, there was a question raised at the Sturgis meeting about why Gateway would invest in a new home centre after its experience in Canora during which the Gateway lumber yard had to be closed only a few years after it opened.
聽聽聽聽聽聽聽聽聽聽聽 Antonovitch responded that building a new home centre is not only a major investment during the construction phase, it can be very expensive to carry a large inventory when products are not moving.
聽聽聽聽聽聽聽聽聽聽聽 Gateway is proceeding with caution and wants to ensure that the project is feasible before investing the members鈥� money, he said. The Preeceville project has been in the works for several years, but already the feasibility study is out of date.
聽聽聽聽聽聽聽聽聽聽聽 In planning a project of this magnitude, the administration has to take into consideration trends that go beyond the current state of the economy, Antonovitch said. Referring back to the Canora example, the inflation rates of the early 1980s, which went as high as 23 per cent, resulted in a lot of home centres being closed across the province and beyond. The carrying costs of more than $1 million of inventory was prohibitive while tough economic time resulted in a halt to virtually all construction. Not only was nobody building houses, customers did not want to finance even small projects like sheds and decks.
聽聽聽聽聽聽聽聽聽聽聽 For the home centre in Preeceville to be feasible, the board has to be sure that a new home centre can ride the wave even when there is a downturn in the economy.
Buchanan area
聽聽聽聽聽聽聽聽聽聽聽 Antonovitch announced that the Buchanan keylock facility will be converted to a cardlock facility. Members need a key from the limited number available to use a keylock facility while a cardlock facility can be used by anyone in Western Canada with a Co-operative Cardlock Card.
聽聽聽聽聽聽聽聽聽聽聽 A cardlock facility will serve the community better by giving more people 24/7 access, he said. The goal is to increase traffic to Buchanan facilities at both, the fueling facility and the food store.
聽聽聽聽聽聽聽聽聽聽聽 There has been some discussion about the Buchanan store in regards to the pending legislation change to how liquor will be sold in the province, said Antonovitch. The Buchanan store is the only Gateway facility to be selling liquor at present, but before the Pelly store was sold, it too sold liquor. There are only about a half dozen Co-op stores in the province licensed to sell liquor.
聽聽聽聽聽聽聽聽聽聽聽 One aspect that Gateway is particularly looking at is whether it will be able to sell Co-op brand products through its liquor store, he said. Liquor sales legislation in Alberta is far ahead of Saskatchewan鈥檚 and there are Co-op brand liquor store products produced such as beers, lagers, red and white wines, rye whiskey, rum and vodka. These products can be sold only through Co-op stores.
Financial situation
at individual facilities
聽聽聽聽聽聽聽聽聽聽聽 Focusing on various highlights of the financial statement by both Antonovitch and Prestie, members learned that the Canora food stores sales increased by 5.9 per cent to $8,265,675; the Canora service station sales decreased by 6.1 per cent to $4,155,306; and the Canora cardlock sales decreased by 22.6 per cent to $1,155,555.
聽聽聽聽聽聽聽聽聽聽聽 In Buchanan, sales decreased by $54,694 to $1,136,175. The Sturgis store had a seven per cent increase to $1,523,342.
聽聽聽聽聽聽聽聽聽聽聽 The deflated petroleum prices affected the financial statement most prominently for the home centre in Preeceville, through which the bulk petroleum sales are recorded. Aside from the bulk petroleum sales the home centre sales decreased by 0.3 per cent ($14,048) to $4,012,771. The financial statement for bulk petroleum shows a decrease of 23.3 per cent ($1,699,406) to $5,592,944.
聽聽聽聽聽聽聽聽聽聽聽 Though petroleum sales seem to overshadow most aspects of the financial statement, the home centre and the bulk petroleum department made positive local contributions to Gateway鈥檚 bottom line. It was the contributions from the stores in Buchanan and Sturgis that actually negatively affected Gateway鈥檚 financial statement: Buchanan, a loss of $51,682 and Sturgis, $67,489.
聽聽聽聽聽聽聽聽聽聽聽 The Co-operative generated local savings of $156,000, down $2,000 from the previous year.
聽聽聽聽聽聽聽聽聽聽聽 鈥淭his was very encouraging, considering continual losses from the fuel inventory throughout the year,鈥� said Olson. 鈥淢anagement is to be commended for minimalizing losses through good inventory control.鈥�
聽聽聽聽聽聽聽聽聽聽聽 Olson said the board and management are looking at aggressively addressing significant losses on a continuing basis in Buchanan and Sturgis.
聽聽聽聽聽聽聽聽聽聽聽 鈥淭hese losses are negatively impacting the whole co-operative,鈥� he said.
Patronage payments
聽聽聽聽聽聽聽聽聽聽聽 The patronage payment from FCL was $1,335,000 鈥� down $238,000, from last year, he said.
聽聽聽聽聽聽聽聽聽聽聽 鈥淎ll this resulted in after-tax savings of $1,336,688, down $97,000 from last year.
聽聽聽聽聽聽聽聽聽聽聽 鈥淭he board has approved a patronage allocation of $672,091 of which 30 per cent will be paid back in cash,鈥� said Olson. 鈥淭his payment represents 5.5 per cent on petroleum purchases, two per cent on food purchases and two per cent on hardware and lumber. Equity cheques will be available at Preeceville and Sturgis on May 10 and in Buchanan and Canora on May 11.鈥�
Elections
聽聽聽聽聽聽聽聽聽聽聽 Elections were necessary to fill the delegate seats in each of the four Gateway areas.
聽聽聽聽聽聽聽聽聽聽聽 In Canora, the terms expired for Nick Zawislak, Pam Rurak, George Stinka and Cindy Manahan.
聽聽聽聽聽聽聽聽聽聽聽 Nominated for the four positions were: Zawislak, Stinka, Manahan, Tammy Bobyk and Alfredo Converso.
聽聽聽聽聽聽聽聽聽聽聽 To make it unnecessary to decide the delegates through balloting, Zawislak, who has been a delegate for more than 40 years, said he withdrew his nomination to allow someone new to take the seat. With only four nominees, they were declared elected by acclamation.
聽聽聽聽聽聽聽聽聽聽聽 In Buchanan the term expired for Gary Kupchinski. Tammy Senholdt was the only person nominated and she was elected by acclamation.
聽聽聽聽聽聽聽聽聽聽聽 In Sturgis, the term expired for Carla Keller, who had served one year after being elected in a byelection. A second seat was vacant because Bert Suknasky had stepped down with one year left on his term. Keller and Jamie Lario were nominated and declared elected by acclamation.
聽聽聽聽聽聽聽聽聽聽聽 In Preeceville, the terms expired for Lyle Olson and Howard Bilan. Olson was the only person nominated and declared elected by acclamation. As Bilan decided to retire and no one else was nominated, that delegate position remains open.
Emphasis on youth
聽聽聽聽聽聽聽聽聽聽聽 During the general manager鈥檚 report, Antonovitch showed a video about youth camps offered by the Saskatchewan Co-operative Youth Camps organization at Moose Mountain Lake and Candle Lake. The camps are for youth aged 12 to 18 years.
聽聽聽聽聽聽聽聽聽聽聽 The goal is to develop future leaders, he said.
聽聽聽聽聽聽聽聽聽聽聽 The video included several testimonials from youth who had attended the camps. In addition to learning about co-operator ideals, the camps also taught essential life skills and included numerous fun activities such as canoeing, swimming, games, campfire events, singing, dancing and other social activities.
