Jim Erickson

Jim EricksonManager of Corporate CommunicationSouthern States Cooperative Inc.6606 West Broad StreetRichmond, VA 23260Phone: 804-281-1392Jim.Erickson@SSCOOP.COM

Jim Erickson

Southern States, the country's ninth-largest agricultural cooperative, lost money in fiscal 2001 and expects a loss in fiscal 2002, said Jim Erickson, speaking for the cooperative.Farmland, the largest U.S. agricultural co-op, filed for Chapter 11 bankruptcy protection May 31.

Cooperatives have to be quick to react to changes in agriculture, experts say.

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These are some of the issues Southern States is confronting as it works to reduce its debt and regain profitability, Erickson said.Southern States purchased Agway's lawn and garden business in 2000, and that acquisition has added to its debt.

"Agriculture tends to be very cyclical in nature, and one of the things we've realized is that when times are good, you still have to watch out for your balance and your debt load," he said.

Southern States is striving to adjust as the industry shifts.The 23-state region the co-op serves is seeing a significant drop in the number of medium-sized farms, but an increase in number of smaller, part-time niche farmers.

"We have to be able to go after that market as well," Erickson said."We are also focusing on our core businesses, and divesting some of the businesses we were in to free up capital."

Southern States plans to outsource its credit and transportation functions, leaving its core business of farm supplies and service.

If the strategy sounds familiar, it's because Agway's restructuring plan announced in March also calls for selling some of businesses while focusing on others.

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Erickson, of Southern States, agrees.

"Cooperatives will continue to have a role to play in rural America's efforts to develop a viable, strong rural community," said Southern States' Erickson."We just have to be sure we're as efficient as we can be, because today's economy doesn't permit anything less."

© 2002 The Post-Standard.Used with permission.

Southern States spokesman Jim Erickson said of Allen, "He's a great fellow.
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Erickson explained there are a lot of changes going on in farming today and the cooperative wants to be sure it is getting input from all levels of its membership to see how it can meet their needs and expectations.The Young Cooperator program is designed to tap into a group of newer people in farming to see how they view the services the cooperative offers."To operate as efficiently and effectively as we can, we need that kind of input from all parts of our membership," Erickson said."This program can help familiarize these newer, younger members with the organization itself - what makes a cooperative unique, how it is organized, how it differs from other businesses and what their roles are.It's a good way to expose them to ‘Co-ops 101.'"Southern States also views the program as a head start to developing future leadership in the organization, Erickson continued."Leadership is especially important in a cooperative, because the owners are users and the users are owners.It's important that member-customers, the people we serve, are prepared, willing and able to take on leadership roles in the cooperative."

James R. Erickson, Southern States Cooperative, Richmond, Virginia

The decision to recommend such a vote was prompted by the cooperative's board of directors, which has recently had to cope with losing much of its agricultural base, said Southern State's spokesman, Jim Erickson.

"This has been happening gradually over the years," Erickson said, adding that the local store has not been generating enough business to cover its overhead and expenses, and remain profitable.
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Such a situation is not unusual along the East Coast, Erickson said.

"Farm numbers have declined," he said."A lot of areas that used to produce crops now is in houses and commercial developments and, as a result, the customer base has basically dwindled."

Similar changes have been also happening in various towns that were once rural but now are being encroached by larger, metropolitan areas.

After the board of directors made its recommendation, a formal letter with the details of its proposal and an announcement of the Thursday meeting were sent to all members, many of whom have already voted by proxy, Erickson said.

If the majority of members agree to close the doors to the Martinsburg store, its assets will be sold during the liquidation process.

"That will start happening very quickly," Erickson said."The goal will be to liquidate it in a good, businesslike way and to basically shut the doors as quickly as that can be arranged."

Employees of the Southern States Martinsburg Cooperative will likely be offered jobs at other regional stores.

The business has a policy in place that allows for employees of a store that is closing, for whatever reason, to be placed at other, nearby locations, Erickson said.

"At this point, we're pretty convinced that substantially all of them will be offered opportunities at other local Southern States stores," he said.

Jim EricksonManager of Corporate CommunicationSouthern States Cooperative Inc.6606 West Broad StreetRichmond, VA 23260(804) 281-1392Jim.Erickson@SSCOOP.COM

Jim Erickson - Southern States Cooperative, Inc.

Jim EricksonManager of Corporate CommunicationSouthern States Cooperative Inc.6606 West Broad StreetRichmond, VA 23260Phone: 804-281-1392Jim.Erickson@SSCOOP.COM

Jim Erickson

Southern States Cooperative, Inc.