Fontanelle couldn't attract a major grocery store, so residents built one
By PATT JOHNSON
REGISTER BUSINESS WRITER
Fontanelle, Ia. — Eight years was too long for the folks of Fontanelle, a town of 700 in southwestern Iowa, to go without a grocery store.
Unable to attract a major grocery chain to town, Fontanelle community leaders crafted a plan to build their own market. They designed a building, found an empty lot in the center of town and sold shares for $250 each to raise money for the store. It was a town project from start to finish, said Larry Raper, a Fontanelle businessman who helped spearhead the plan.
With about $450,000 and a matching amount in sweat equity, the Nodaway Valley Market opened at 6 a.m. April 11, on the corner of Washington and Fourth streets.
"Our proudest moment was when we finally opened the doors," Raper said.
Residents and shoppers from surrounding communities have come to shop at the market.
"Oh my gosh, it's been a blessing," said Mildred Sears, 90, of Fontanelle. "We have a lot of elderly who don't have to go so far now for groceries."
The 6,300-square-foot brightly lit market is full of neatly stocked shelves containing a variety of products and groceries, said Tab Rasmussen, the store's manager.
"We have no deli, no bakery, no bank," he said. "We're a basic, no frills store."
What the store does have - and what were top priorities for Fontanelle residents - are a fresh meat case, fresh produce and reasonable prices. It also has some of the coldest beer in town, a small liquor department, a Krispy Kreme doughnut stand - and, for now, free cups of coffee.
Nodaway Valley Market is one of about 600 grocery stores in the state, of which about 275 are small independent stores, said Jerry Fleagle, president of the Iowa Grocery Industry Association.
Towns such as Fontanelle have realized that a grocery store is vital to survival, Fleagle said.
Ten of the 99 counties in the state have no local grocery stores, said Terry Besser, a sociology professor at Iowa State University. "And that impacts the quality of life in those areas," she said. Grocery stores are important because they not only are a food source but also provide a "place for people to meet and see each other."
Fontanelle's last grocery store had closed a decade earlier. Residents had to drive six miles east to Greenfield where they could shop at a Fareway grocery store or 40 miles south to a Wal-Mart Supercenter in Creston, Raper said.
"We knew that as a community, if we were to improve and grow, we needed three basic things," Raper said. "We needed good schools, which we had. We needed a good water system, which we had after putting in a line from Greenfield.
"And we needed a grocery store."
The Greater Fontanelle Community Foundation, a group of local business owners who promote development, put its focus on getting a market.
"We approached Hy-Vee and Fareway, but being our size community, they weren't interested," Raper said.
The foundation created Summerset Enterprises Inc., a state-registered corporation. Summerset then began selling shares for $250 each.
"We wanted to sell shares in the community to raise capital and to make residents feel part of the project," said Raper, who owns Turf and Timber, a lawn implement store in town.
The corporation by-laws stated that individuals could buy as many shares as they wanted, but would have only one vote, he said. When the store makes a profit, shareholders will be paid dividends, Raper said.
Most people bought one to four shares. The corporation was able to raise $280,000 of its $300,000 goal.
Many people with no room in their budgets to buy shares instead donated $25 or $50 to the project.
"They just wanted to be part of it," he said.
Well into the project, costs increased. Summerset Enterprises took out a $150,000 loan from First National Bank in Fontanelle to finish the store.
"We looked at it as doing our part to help the community meet a need," said Mike Cass, bank president and also a member of the Summerset Enterprises board.
Town residents showed up to install coolers, stock shelves and help where they could.
"There was one farmer who would drive his tractor into town to help unload pallets from delivery trucks," said Mary Nickels, a retail counselor from Nash Finch Co., a Minneapolis-based food distribution company that supplies Nodaway Valley Market. "There is a lot of community pride in this store."
Rasmussen, who was hired in February to manage the store, said store shareholders were depending on him to set up the store.
"People have put a lot of money, time and effort into this store," Rasmussen said.
Business has been good in the first month of operation. The store is drawing in shoppers from surrounding towns.
Raper and Cass acknowledged there were some naysayers who doubted the viability of a local grocery.
"Now that it's open, they like what they see," Cass said.
Amy Ford and her daughter Krista Tuttle, 4, pulled their red wagon to the market last week during a trip to buy treats to fill May baskets.
"I do my regular weekly shopping here," Ford said.
Fred Greiner, president of the Boone-based Fareway Inc. grocery store chain, said: "Maintaining the store will be a challenge. It will take everyone shopping there."
Fareway, which generally operates in small towns, is Nodaway Valley Market's closest competitor, six miles east in Greenfield.
Market organizers said the five-year goal is to find a private buyer for the store.