First Nations Artists Co-operative

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Date of Incorporation: Not yet incorporated

Membership: 12 proposed members, including 3 proposed directors.

Activity: The First Nations Artists Co-operative links aboriginal artists with the Eagle Feather Gallery, where they have access to studio space and are able to sell their work. It works to promote the production and marketing of First Nations arts and crafts.

Organizational Form: Producer Co-operative

Area Served: The co-operative is located in downtown Victoria1, British Columbia, and promotes the art and crafts of First Nations artists from Vancouver Island and the coastal region of British Columbia.

Background

The First Nations Artists Co-operative was created by Shirley Blackstar and Chris MacDonald and First Nations artists. They created the co-operative because they believed that it could be an effective way for artists to collectively pool their resources and develop access to retail markets. Shirley Blackstar (who is Cree) and Chris MacDonald lived in Japan for 10 years. While there, Ms. Blackstar operated a trading company that imported various First Nation's arts and crafts for wholesale and retail sale. Upon returning to Victoria, Ms. Blackstar created a line of beaded jewelry, which she hoped to sell to retail buyers.

 In March of 2001, Ms. Blackstar applied to the Bastion Square Festival of the Arts, in Victoria, and was accepted as a vendor of First Nations arts and crafts. Throughout the month of April the market was only open three days a week and this was weather dependent. The daily setting-up and taking down of displays, as well as the continued cost of renting the space ($400 per month during peak summer months), all proved it to be a difficult way to run a retail business.

 During the first week of May 2001, Ms. Blackstar and Mr. MacDonald set off on a trip, stopping in Banff to visit retail shops in an effort to market Ms. Blackstar new line of beaded jewelry. This proved to be an important experience, as they had to deal directly with the challenges associated with entering the retail market. It was during this trip, after returning from a Round Dance at a family event in Saskatchewan, that Ms. Blackstar and Mr. MacDonald began to discuss the idea of creating a way for artists to work together to create a retail business.

 While driving through Cutknife, the home of her ancestor, Chief Poundmaker, Ms. Blackstar and Mr. MacDonald began to more concretely develop the idea of creating a gallery and studio. Their vision included a place where artists could work on-site and share their art and culture with the public. The underlying belief was that a joint venture between artists and a gallery could offer an effective way of increasing access to the retail market for First Nations artists.

 Upon returning from their trip, Ms. Blackstar and Mr. MacDonald organized meetings with First Nations artists who lived and worked in the Victoria area in order to discuss plans for creating a new First Nations Gallery & Studio. These meetings were held weekly through May and June 2001, at the Victoria Native Friendship Centre2.

 There was strong support from the artist community for going ahead with such a project, so Ms. Blackstar and Mr. MacDonald developed a formal business plan and located a potential space for the gallery. They drew on the skills of Mr. MacDonald, (formerly employed by Standard & Poor's as a business manager responsible for finance and operations) who agreed to volunteer his time and business expertise to the project. Unfortunately, the landlords of the space would not lease to a co-operative that had no assets or solid track record. However, they were prepared to lease to Ms. Blackstar, who had the required financial resources as well as a background in business. Ms. Blackstar believed in the project and agreed to sign the lease and open the gallery as a First Nations business. As a result, the gallery was to be operated by Ms. Blackstar as a privately owned business and the artists would work together to create an artists' or produces' co-operative that was affiliated with the gallery.

 The premise for the artists co-operative was that collectively, artists could create the inventory for the gallery-thereby sharing the largest cost of opening a retail business-and, in turn, gain greater access to the retail market, which can be a challenging process, especially for new artists. In creating a producer's co­operative that was associated with the retail gallery, the artists believed they could also receive a fair value for their work.

Vision, Purpose and Goals

The vision behind the plans to develop the First Nations Artists Co-operative was to develop support for the production and marketing of First Nations arts and crafts. Historically, First Nations artists have had limited access to the retail market-that is, access to operating a store-front, retail business that sells products produced-and, as a result First Nations have had limited control over the marketing and pricing of their work3. The belief was that a co-operative could be developed into an organization that could help First Nations artists market their work. The co-op could help artists develop profiles, create marketing material and inventory, teach business skills, and provide a space where artists could gain retail and exhibition experience. The goal was to open a retail gallery and studio in downtown Victoria, where the artists could work on site and set the retail price of their work. The gallery would receive a sales commission that would cover its operating expenses.

Starting the Co-operative

Initial discussions for establishing the First Nations Artists Co-operative began in May 2001, when Shirley Blackstar and Chris MacDonald organized meetings with local aboriginal artists to discuss their idea for a retail gallery and studio space.

The group began with no financial resources and so Blackstar used her small business to pay for the meeting expenses at the Victoria Native Friendship Centre throughout May and June, which included room rental and coffee. Limited financial resources are a significant factor in organizing a co-operative and can limit the kinds of initiatives undertaken and progress. The cost of documentation, and the time required to develop the memorandum of association, rules of association, and information regarding directors and addresses, are issues that had to be considered in organizing the First Nations Artists Co-operative. Further compounding the difficulty of getting the organization up and running, the co-operative itself was not eligible for conventional commercial financing because of its lack of financial resources and assets.

Given the focus on addressing the financial needs of the members, the first priority was the economic development of the co-op. The group believed that building a retail operation was the way to do this and therefore, focused energy on figuring out how to finance the opening of a gallery. This meant creating two separate entities: an artists co-operative (or producers co-operative), and a retail gallery organized as a private business. Though this was not the original intent, financial barriers prevented the opening of the gallery as a co-operative.

A business plan and budget were developed for opening and operating the gallery. Opening the gallery would require approximately $20,000 to finance the outfitting of the retail space, and to cover opening expenses, such as inventory and two months advance rent. Given the liability of signing a commercial lease, Ms. Blackstar and Mr. MacDonald conducted a number of meetings with the landlord to negotiate a reasonable lease. To secure the lease for the retail space for the gallery, Ms. Blackstar used her company, Tansi Trading, to assume the liability for the new business. It was through her business and a further investment, that financing for the gallery was made possible. In addition, Ms. Blackstar secured a loan through Tale'awtxw Aboriginal Capital Corporation4 to assist with the outfitting expenses and rent deposit.

A business account was opened with Coast Capital Savings and a line of credit, which is tied to the equity in Ms. Blackstar's principle residence, was established (it should be noted that operating capital is difficult to finance without possessing significant assets, such as real estate). In addition, a $21,000 marketing grant was secured by Ms. Blackstar's company, Tansi Trading, from Aboriginal Business Canada.5 This grant covers 60% of the cost of approved marketing expenses, which is refundable upon payment, and has assisted with marketing expenses that would be otherwise difficult for a new business to finance.

The retail business was opened July 7, 2001, as Eagle Feather Gallery - First Nations Artists Gallery & Gift Shop. In order to secure studio space in the gallery, artists submitted an artist profile and a $100 monthly space fee. Twelve First Nations artists completed applications for space in the gallery and prepared their inventory.

The original idea when the gallery opened was that the First Nations artists would supply the inventory and set the retail price of their work in the gallery. They would contribute a $100 space fee each month and the gallery would charge a 25% commission on sales. Ideally, the space fee would assist in subsidizing the $2,400 monthly rent, and the sales commission would finance the operating expenses and sales staff salaries. However, this plan proved to be overly optimistic in terms of commitment by some artists to provide inventory and to pay a monthly space fee. As a result, a 40% sales commission with no space fee was offered to those artists who did not make enough in monthly sales to make the space fee cost effective.

 To date, the co-operative has received no other funding. Plans to apply to the Provincial Government's 'Partners in Co-operatives' program were put on hold until the current government completes it review and decides if the program will be continued.6 This type of program and the mandate that it supported are viewed as invaluable by the organizers of the First Nations Artists Co-operative because access to financial resources to support the organization and the planning of a co-operative is an important factor that can determine its chance of success. However, while a lack of financial resources has been a significant factor in developing the co-op, co-operative organizers feel that they can manage by depending on volunteer time and resources. Still, the amount of financing available for future co-operative initiatives will impact the type and scope of projects that are feasible to undertake.

 What began initially as an initiative to develop access to the retail market for First Nations artists has developed into a joint effort to launch a retail gallery with studio space. The privately owned gallery provides a retail outlet for the artists, and the members of the First Nations Artists Co-operative supply their creations to the gallery. For these artists, this is an opportunity to set the retail price on their work, and to promote their art in a working gallery/studio.

Organizational Structure

 The plan for the co-operative is to create a Board of Directors by nominating three directors who share the vision of the co-operative. The directors will each have one vote, and decisions will be made by consensus amongst the Board. As the co-operative is a new entity, the directors will each have a one-year term, and a mandate to establish and define the objectives of the co-operative as well as to work to represent the interests of the members. The board does not currently have specific positions; rather, the individuals who take the initiative to develop them will define roles.

 New members will apply for sponsorship by an existing member and submit a written application for membership. Although no share fees have been collected yet, the planned co-operative share price is $100, and all shareholders will be Class A-voting shares. Co-operative members are requested to volunteer their time for the planning events that they are involved with at the gallery. Time commitments will be determined by the scope of the project.

Links to Community, Network and Outreach

 The First Nations Artists Co-operative has informal links to the community through the First Nations communities on Vancouver Island and the coastal region of British Columbia, as the member artists come from a number of reserves and other communities. As well, through their association with Eagle Feather Gallery, co-operative members belong to the Chamber of Commerce7 and to Tourism Victoria8, both of which are membership fee driven organizations that are effective in raising the profile of the artists within the greater community. Furthermore, as the co-operative builds its financial base, there are plans to sponsor more cultural performances. For example, at the gallery's grand opening, the performers received payment or gifts for their performances: plans are being developed to sponsor a monthly cultural event, which would include offering performances by singers, dancers, and drummers.

 In terms of networking, members have access, again through the gallery, to electronic commerce, which, today, is the backbone of retail business. Making purchases with credit and debit cards is standard when purchasing high-end pieces, but it is difficult for the individual artist to facilitate this type of exchange without a storefront operation. Also, a web site for the gallery was developed9 which provides information on the gallery and artists, as well as an online catalogue with credit card processing. An online tour of the gallery can be seen at www.shopinvictoria.com, and an e-commerce shopping cart system will be added to start developing an online market for the arts and crafts. Co-operative membership also has the potential to provide members with cost effective services. For example, a graphic designer affiliated with the co­operative for a nominal fee designed the gallery's brochure graphics computer program, and access to wholesale supplier catalogues provides member artists with a lower cost source of materials.

 The underlying requirement for members is that they be committed to a co-operative effort. Members must be prepared to dedicate time and energy to their initiatives. This must be balanced by financial incentives because the need for paid work is a priority for the artists who are working to establish themselves and trying to make a living by selling their art. The opportunity for members to be involved in the co-operative creates a great deal of potential.

Future Plans and Challenges

 The co-operative's short-term goal is for the members to work together to successfully establish their access to the retail market. In conjunction with developing retail access, plans to establish an 'Authentic Aboriginal Artists' certification and logo are in the works in an effort to ensure authenticity. Ms. Blackstar, who is seeking support from organizations that would have the financial resources to implement such a program, proposed this initiative.

 In the long-term, the co-operative's goals will reflect the needs of its members as their access to the market matures. Focus on the essentials of retailing, such as developing inventory, producing marketing materials, and providing access to materials and tools, will be a priority.

The co-operative will work to increase membership, seeking out new members who share the objectives and philosophy of the co-operative. While the economic benefit to members, in terms of employment and commerce, is clear, the main threat to the co-operative's sustainability is the lack of financial resources. Public resources channeled towards such initiatives are limited, as filling the need for economic development in the arts and crafts sector is increasingly being left in the hands of private enterprises.

Lessons Learned

 There are many things to learn when starting a co-operative, and it is during the start-up phase that a strategy can be developed for effectively organizing the co-operative. If possible, learn from both the positive and negative experiences of the start-up phase, while focusing on the successes in order to help the co-op reach its goals.

 Seek out the knowledge of those who have been successful, whether in business or as an artist, or both, and learn from their experiences. Also, be flexible so that the co-operative can adapt to best serve its membership.

 Communication is a key factor in organizing a co-operative. The First Nations Artists Co-operative found that written handouts for meetings were effective, but that face-to-face discussion is necessary in order to ensure accurate communication. Cultural differences and sensitivities in communication need to be appreciated and understood by all parties.

 The most important experience that can be shared is to believe that a group, working with a common vision and toward a common purpose, can achieve many great things.

Endnotes

1 The city of Victoria, the capital city of BC, is located on the southern tip of Vancouver Island, just off the West Coast of BC. It is accessible by ferry from the mainland of BC, as well as from Bellingham, Port Angeles, Anacortes and Seattle in Washington State. For more information see: www.tourismvictoria.com

2 The Victoria Native Friendship Centre provides services and information to Native people in the Greater Victoria area. It is located at 610 Johnson St., Victoria, BC, V8W 1M4. (250) 384-3211; www.vnfc.ca.

3 Typically, when First Nations artists wholesale their work to retailers in Victoria, it is the buyer for the retail outlet who determines the price they will pay the artist for a piece of work. In standard retail, the wholesale mark-up for products from manufacturers is 100%, especially for gift shop items ordered from suppliers.

4Tale'awtxw Aboriginal Capital Corporation supports the success of Aboriginal Entrepreneurs with business financing and support services. The loan officer for Vancouver Island, Mary-Ellen Wood, assisted with the loan application and advised the applicants throughout the process. Tale'awtxw Aboriginal Capital Corporation Branch Office - Chemainus, 12605 Trans Canada Highway, Ladysmith, B.C., V9G 1M5 Tel: 1-800-779-7199.

5Aboriginal Business Canada is an Industry Canada program which encourages the growth of commerce as one means towards building self-support for all Aboriginal people. http://abc-eac.ic.gc.ca.

6 In June, 2001, BC's provincial government changed. Almost immediately, the new Liberal government began a 'Core Services Review' of all government ministries and services, and decided to end support for the development of co-operatives, including the Partners in Co-operatives program.

7www.gvcc.org

8 www.tourismvictoria.com

9 www.eaglefeathergallery.com

 

Case Study Information

Researchers: Chris MacDonald

Date of research: 2001

Author: Chris MacDonald

Date of writing: 2001

Editing: BCICS editorial team

Supervision: Kathleen Gabelmann, BCICS Research Co-ordinator

Creator - Author(s) Name and Title(s): 
Chris MacDonald
Date: 
Monday, January 1, 2001
Publisher Information: 
BC Institute for Co-operative Studies, University of Victoria

Location

Victoria, BC
Canada
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