For over sixteen years, a nonprofit called Women’s Action to Gain Economic Security has incubated and supported worker cooperatives to advance a vision of economic empowerment and opportunity for immigrant women. Today, the four worker-owned, eco-friendly house cleaning co-ops WAGES developed between 1998 and 2010 are thriving along with their formerly low-income immigrant Latina membership. Collectively we generate over $3 million in sales each year, serving over 2,000 households in the San Francisco Bay Area and ensuring stable, empowering livelihoods for nearly 100 worker-owners. A key to this success has been the process through which WAGES creates new co-ops, transforming marginalized immigrants into business owners.
Until last year, each cooperative was developed independently of the others, building on lessons WAGES has learned over the years. However, WAGES’ latest co-op development effort has taken a new approach, combining our nonprofit’s cooperative development expertise with the business infrastructure of the largest co-op incubated by WAGES, Natural Home Cleaning Professionals in Oakland. This arrangement has provided value for all three organizations: WAGES, NHCP, and the new cooperative now doing business as Natural Home Cleaning Contra Costa.
Mutual Need and Benefit
WAGES regularly provides technical assistance and advice to other nonprofits seeking to develop worker cooperatives. But in late 2010 WAGES encountered an unusual development: After providing technical assistance and training for over two years to a co-op effort in Contra Costa County, WAGES was asked by the local nonprofit partner to consider assuming the primary responsibility to continue the co-op’s incubation. As we explored the project, it became clear that there was a unique opportunity not only to support the fledgling co-op’s growth and development, but also to test the possibilities for a new approach to co-op incubation that could benefit multiple partners:
• The three members of the young Contra Costa cooperative were in need of a co-op development partner to support them in building the business and cooperative culture while achieving self-sufficiency and family-sustaining livelihoods.
• WAGES had been seeking ways to increase the efficiency and lower the cost of incubating new cooperatives while exploring ways to better support the mature co-ops that it has previously developed. With this potential new approach, we expect to see savings from joint branding and administrative services, nurturing the co-op to self-sufficiency in less time and at a reduced cost.
• Worker-owners at NHCP had begun discussions over the past few years about the possibility of exploring new lines of business that could support the livelihoods of women aging out of the physical demands of house cleaning work and generate new revenue sources for the cooperative, increasing profitability and creating additional jobs.
The co-op development project in Contra Costa presented an opportunity to advance the goals of all three organizations by combining forces, and as we began exploring the possibilities we found it to be a good fit for all stakeholders. WAGES was able to quickly secure funds to staff the planning phase of the project and begin work on the effort if it proved feasible.
One of WAGES’ senior staff members, Deb Goldberg, already splits her time between WAGES’ co-op development efforts and staffing for the Oakland cooperative, which employs her as their general manager. She was excited to lead the project and the WAGES incubation team. Coordination between the cooperatives promised to be relatively smooth given their close geographic proximity, as the mature co-op serves a region that is contiguous to the new co-op’s territory. Members at both cooperatives considered the proposal from WAGES and, after discussion and exploration during early 2011, agreed to join forces with WAGES to support the new co-op’s development.
Maria Lucero, a member of the Contra Costa co-op, was encouraged by this collaboration. “Seeing what NHCP had accomplished, I thought, ‘If they have what it takes to thrive, we can too,’” she said. “And I knew it would go much better with the help of their experience—they really know what they are doing.”
Co-op Structure and Partnership
Over the course of the spring, WAGES staff and co-op members considered options for how to best structure the project. This process drew extensively on past experience.
Since completing WAGES’ intensive incubation program in 2004, the members of Natural Home Cleaning Professionals have continued to build their business with support from WAGES. By last year, however, the members had determined that expanding NHCP’s membership was not their best strategy. At 36 members, the members felt that they had reached their maximum size for healthy group process and cohesion. However, they were interested in finding ways to leverage the co-op’s expertise and administrative infrastructure to develop new income streams, as long as the risk for the business associated with participating in the project was reasonable.
Recognizing the potential of the new co-op to achieve a level of growth that would eventually necessitate independent infrastructure, all three groups reached consensus that the Contra Costa co-op would remain an independent entity and contract with NHCP for support through the mature cooperative’s administrative infrastructure. The new co-op re-formed itself as a new entity under a structure modeled after WAGES past incubation projects, but began doing business under a shared brand as “Natural Home Cleaning Contra Costa.” This allowed staff to leverage the marketing infrastructure and brand recognition of the Oakland business.
WAGES assumed responsibility for providing the management support as well as member training and technical assistance, support for group process and governance. We are also temporarily providing a decreasing subsidy of the operations costs for the business during the first year to help the group navigate the transition and achieve steady growth. The management and operations staff work out of NHCP’s main Oakland office, sub-leasing the space from the elder co-op. The contract provides NHCP with additional revenue and is allowing NHCP and WAGES to test the potential for incubating new co-ops more efficiently by “nesting” the incubation in a mature co-op’s operations.
Early Signs Are Promising
In September 2011, the reformed Contra Costa co-op celebrated its grand opening as a new business, launching a new marketing effort under the NHCP brand and opening recruitment for new members. The group has already welcomed two new members to the original group of three and begun to see modest growth in sales as the newly cohesive partnership gains momentum.
As the co-op begins to grow, we look forward to harnessing the potential for strong, mature cooperatives in the network to support the development of new co-ops. The most important indicator of the project’s promise to date is the satisfaction that worker-owners at the Contra Costa co-op are finding in the increased support of the partnership and the cooperation of their sister NHCP members and WAGES’ staff.
As Maria Lucero sees it, “We’re not worrying about customer service anymore. Before it wasn’t where we wanted it to be, but now we really feel the support from Deb and the operations team, on any questions or challenges that come up. Things are going well!”
Alexandra Armenta is WAGES’ director of development and evaluation. For more information visit www.wagescooperatives.org and www.naturalhomecleaning.com.