Cooperative enterprises may lead to “new normal” for Native businesses

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Beginning the Cooperative Journey Together: A Guide to Indigenous Community Cooperative Development

By Lee Egerstrom

Business has been grinding to a halt in much of Indian Country, perhaps more than in the U.S. economy at large, prompting a Minnesota-based Native enterprise leader to warn we shouldn’t expect change until Indigenous and hard-pressed communities make changes themselves.

“Let’s face it, business opportunities were limited before the virus (COVID-19) hit. And the George Floyd death. And the collapsing economy since,” said Pamela Stranding, executive director of the Minnesota Indigenous Business Alliance (MNIBA).

MNIBA hopes to help Native communities band together, inspire individuals to become successful entrepreneurs, and build new business ventures by using community and cooperative development tools. Working with like-minded people within the cooperative movement and with Native groups in the US and Canada, MNIBA has prepared a guide to help community leaders use new and evolving co-op business models for startup enterprises.

The guide book, Beginning the Cooperative Journey Together: A Guide to Indigenous Community Cooperative Development, can be downloaded from MNIBA’s website. Printed copies have been delayed with COVID-19 temporarily shutting down the Leech Lake Tribal College’s design and printing operations.

It is time for Indigenous and minority communities to design and create their own local and community-centric enterprises, thus create a “new normal” for moving forward, Standing said.

“The old ‘normal’ isn’t coming back. It wasn’t that good for Indigenous people and communities of color anyway,” she said. No one can say how long it will be before face-to-face retail sales will be possible for many Native artisans and other producers of unique products. Supply chains are disrupted. Far more technology will be needed for local people to reach broad markets for goods and services.

Corrective measures can be taken by community enterprises and especially by individual producers and consumers banding together with colleagues to extend their reach, she said.

MNIBA’s Cooperative Guide gives good descriptions of various kinds of cooperatives found in the US and Canada. They include consumer co-ops, farmer and independent small business co-ops, worker co-ops, and hybrid and “platform” coops.

The latter are described as “two emerging models, consumer-worker cooperatives and cooperatives focused on workers in the free-lance economy,” which include online, or app-based business ventures. Consumer-worker cooperatives have employees and consumers both owning and managing the cooperative – an evolving model being adapted to grocery and retail cooperatives.

Consumer co-ops would include mutual insurance companies and credit unions that are member-owned, which explain why one out of three Americans are co-op members whether they realize it or not. Farmer and independent small business co-ops, meanwhile, are not always small. CHS Inc., based in Inver Grove Heights, and Arden Hills-based Land O’Lakes are both farmer-owned Fortune 500 companies.

The Guide also identifies existing Indigenous-owned and operated co-ops in Alaska, Arizona, Georgia, Hawaii, Minnesota, Mississippi, Montana, New Mexico, New York, North Carolina, North Dakota, Oregon, South Dakota, Washington and Wisconsin.

Among Minnesota co-ops is Northern Eagle Federal Credit Union, which has 700 members of the Bois Forte Band, their non-member family members, and Bois Forte employees, including Fortune Bay Resort Casino and Nett Lake School employees. Another is the White Earth Reservation Federal Credit Union.

Native co-ops in adjacent states show how cooperative business models serve various communities and entrepreneurs. South Dakota and Wisconsin both have tribal-based credit unions, and groups such as the Owinja Quilters Cooperative at Pine Ridge in South Dakota and Intertribal Maple Syrup Cooperative for Native producers in Wisconsin.

Four miniature case studies recounts successes for cooperatives that can serve as models for other business developments. They include the Qualla Arts and Crafts Cooperative, the oldest Native co-op dating to 1946 serving Eastern Band of Cherokee artisans; Umpgua Indian Utility Cooperative that provides electricity, and other services for the Cow Creek Tribe in Oregon; the Oomingmak Musk Ox Producers Cooperative for clothing producers in remote coastal villages in Alaska; and Bois Forte’s Northern Eagle.

The authors caution that developing cooperative enterprises is a lengthy process with several challenges. Among them is a distrust that comes from many existing co-ops with Eurocentric models that were used as part of the colonization process, and from a blurring of distinctions between cooperative and tribally-owned enterprises.

“We have not developed our own Indigenous stories, models and histories of Indigenous cooperative development to turn to for an example of ‘how-to’ and ‘best practices’,” they wrote.

Land and personal ownership issues can be tricky on reservations, they acknowledged. Confusion about membership may also persist with some tribal citizens assuming membership in a co-op is a sovereign, or tribal right not requiring voluntary membership and participation.

But, the authors write, a cooperative can make a good fit when people want to work together, communities have identified a need to diversify and strengthen local economies, communities want to be engaged in business ownership, the idea and model comes from within and not outside the community, and when it advances Indigenous language and culture.

Trying to help make a cultural fit, Standing (Cherokee) and others looked inward at the dominant Dakota and Ojibwe Indigenous languages of Minnesota. There are words that make a good fit with cooperative business models, she said. But the word democracy – the key element in membership and governance of a co-op – does not appear in either of Minnesota’s dominant Native languages or any other Native language that Standing and team could find.

“We need everyone to understand it, but we don’t need a (Indigenous) word for it,” she said. “It is in our DNA. Democracy is how Indigenous people have survived.”

So, is America at a tipping point in which business and community activity will not return to pre-2020 norms of behavior? Standing, for one, hopes so.

Community, cooperative development has worked before, close to home. A recent example followed the rural recession, often called “the farm financial crisis,” of 1982-87. Rural communities were in near-depression condition. Farmers and rural communities launched a number of new businesses, especially in Minnesota and North Dakota, creating new uses and markets for nearby farm crops while creating local jobs. Renville, in western Minnesota, was a hotbed for this development.

A local co-op leader wisely cautioned at the time, “Adrenaline in not a substitute for a good business plan.” Standing issues a similar caution now. Cooperating in a community is as old as the Indigenous population, but business plans and legal frameworks for cooperatives are new and constantly changing.

Communities can recognize needs, shared vision and values. They also must turn to experts in law, business policy and management to properly structure and direct new community ventures.

MNIBA is working with various Indigenous groups in the Southwest, Western states, and First Nations people of Canada; with supportive national and local cooperative groups and agencies (Cooperative Development Services, Cooperation Works); academic centers from Canada to New Mexico, with local academics, and with the Center for Cooperatives at the University of Wisconsin Madison.

As part of such partnering groups, it has been involved with conferences for child care cooperatives and in cooperative training and education programs for Native students.
The MNIBA Cooperative Guide is already serving as a nationwide teaching tool while it waits publishing in printed form. Hopefully, Standing said, a new generation of educated young people will be able to help Indigenous and communities of color develop community and cooperative enterprises to unleash cultural strengths and opportunities.

The Guide can be downloaded at: https://www.mniba.org/programs/cooperative-development.html.