Innovation

The Badger House Coffee Co. makes use of a cooperative business model, an approach that is quite different from other coffee shops. Most traditional cafes follow revenue- or profit-maximizing practices with which money is prioritized. However, The Badger House chose to strongly focus on ensuring equity among all its employees. This co-op model allows for the employees to have ownership stakes, as well as decision-making power when it comes to business operations.

This unique type of model first emerged in the 19th century. Its efficiency and effectiveness—both socially and economically—are proof that promoting democratic governance within a company can help achieve high socioeconomic wellbeing.

Danielle Thompson, founder, worker, and co-owner of The Badger House, was at the origin of the implementation of this business model as a coffee shop business.

Inspiration

Danielle Thompson’s inspiration came from her visit to the Rock City Cafe in Maine. She was compelled to take on a cooperative approach to running her business: “I am a coffee lover and have always dreamed of having a cozy, welcoming coffee house. I love the idea of worker-owned businesses. I think giving power and equity to workers is a great way to work towards a more equitable society.” Seeing how this model was incorporated into Rock City Cafe, Thompson had the desire to create a more equitable, worker-operated model. She was passionate about creating a space where her employees would genuinely care about the success of the business. In terms of the business itself, Danielle believes the cooperative model will bring many benefits. Thompson hopes to not only serve delicious coffee, but also empower her employees.

Overall impact

Indeed, by focusing on having a cooperative business model, Danielle Thompson hopes to benefit from having highly motivated employees, who will add to the company's success. Being that these employees will be more engaged, they will be more productive in their work. This ultimately will lead to long term success. Thompson shared her belief that “the employees will be more invested in the success of our company because they share ownership. In turn, this would hopefully motivate all of us to create a more successful business.”. Incorporating this model into the business also increases employee retention, which in turn reduces turnover costs.

Business benefit

The Badger House Coffee Co. remains in its debut and has not yet faced the challenges that cooperative worker-owned businesses usually face. Nonetheless, Danielle is aware of the setbacks she might encounter as the Badger House grows larger and has more workers owning the business: “I anticipate we will run into challenges when there are disagreements about the business and will need to put well thought by-laws in place as a baseline to help navigate conflict resolution.” Still, Thompson has high expectations for the future of the Badger House Coffee Co. and has already started collaborating with other local businesses through a “co-op incubator” to secure more stable long-term benefits and overall effects of the cooperative: “We completed the Co-op U course through Cleveland Owns and they have helped connect us with many other small businesses and organizations that we hope to stay connected with and support each other as our businesses grow.”

Social and environmental benefit

In addition, having a fair wage policy will help enhance its reputation as a desirable place to work: “We plan to implement a fair minimum wage for all employees—$20 per hour—and have a maximum cap for the highest paid workers”. This model will help attract both customers and employees who value social responsibility and ethical production. The impact of this first local worker-owned coffee shop in Parma will have a highly positive impact on the community as a whole as well.

Environmentally speaking, The Badger House Coffee Co. sources and roasts its coffee beans “in partnership with First Crack Cleveland”, a provider that keeps the Badger House informed of the former’s Fair trade status. Such practices ensure the business’s completion of the UN SDG Goal 12 to produce responsibly. The Badger House also shows a strong focus on environmental sustainability through the owners’ shared goal to minimize their waste and incorporate the use of reusable cups and composting bins in the future. Thompson explained how her company aims to engage with the community through creative initiatives like lanternfly removal contests and educational sessions on pollination.

Interview

Danielle Thompson, Founder, worker, and co-owner