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May 2, 2003

FCNQ shuts down money-losing Kuujjuaq co-op store

Sister stores asked executive to help store with daily management

ODILE NELSON

Large financial losses, constant theft and an inability to attract management personnel forced Northern Quebec's co-op federation to close its Kuujjuaq store April 29 – though the company vows to reopen the business in the next few months.

Rob Collins, general manager of the Fédération Cooperatives du Nouveau Québec, said though the decision may have taken many by surprise, "the writing has been on the wall" for the Kuujjuaq store for several months.

During the FCNQ's annual general meeting April 7 to 11, directors from Nunavik's other 12 co-ops recommended the FCNQ's executive management help the Kuujjuaq store in its "day-to-day affairs" because they would no longer continue to financially support their sister store.

Nunavik's other co-ops have boosted the Kuujjuaq co-op's bottom line for the past three years.

Then on April 24, the FCNQ executive committee and Kuujjuaq co-op's board of directors mutually agreed to temporarily close the store and lay off its staff.

The temporary closure, Collins said, will give the co-op time to review its role in the community.

"Various attempts had been made to turn the situation around and they were not successful enough," Collins said. "Now we can reassess all the options; what kind of store do we want there, what kind of store can we afford to have and what are the needs of the community of Kuujjuaq that we can successfully meet."

Collins said these options could include a store similar to the one that existed – offering food, household and larger-ticket items – or something with more of a niche market.

Though two other general retail stores, a Northern store and Newviq'vi Inc., in a town of 2,000 make for tight competition, it was only one of several factors leading to the closure, Collins said.

"The market is different in Kuujjuaq because of its ready access to the South, the large number of non-Inuit living in Kuujjuaq who have all their linkages to the South," he said.

"Newviq'vi has been extraordinarily successful because of its management but it's a blend of different reasons leading up to this. I believe our prices are extremely competitive. The store itself isn't our best store and we've had difficulty getting the right staff."

Collins said frequent thefts and difficulty attracting and keeping long-term staff have also had an enormous impact on the business.

The decision to close the store took many by surprise. The FCNQ seems to be coming off a year of exponential growth. Last November, Kuujjuarapik unveiled a new store and one month later Puvirnituq opened its $4-million superstore.

The Kuujjuaq store is one of the federation's founding co-ops and has been a valuable presence in the community for more than 36 years.

Collins said, however, that Kuujjuaq's co-op movement has always been relatively weak compared with other Nunavik communities.

And though Kuujjuaq's co-op opened a new $2-million, 15-room hotel two years ago, the retail store has been losing money for several years.

Collins declined to attach a dollar figure to the loss.

Bobby Snowball, who has been involved with Kuujjuaq's co-op movement since 1967 and now serves as the FCNQ's executive secretary, said the store would re-open with new focus and new staff in a few months.

Snowball said in the past co-op stores in other Nunavik communities, like Salluit and Kangirsuk, have experienced similar problems but have managed to rebuild.

Snowball hopes the closure will show Kuujjuaq residents the important role the store plays in the community.

"The decision to close was a good decision because it's also a lesson for the membership. There have been three other co-ops in the region that have closed for the same reason, and today those other co-ops are operational again. We'll take those lessons as well as our own.... We'll be able to move forward to the future from this lesson," Snowball said.

"I'm not worried about the co-op movement dying in Kuujjuaq. Especially for the membership, now that they've experienced this I think they'll know now what their responsibilities are in keeping their co-op."

The co-op hotel and its tourism ventures, including hunting, fishing, outfitting and adventure tourism, will continue during the store closure.

But the retail store will remain closed for at least a few months and the co-op's chequing, loan and money transfer services along with it.

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