Bay, Northwest Territories
A commercial arctic char fishery was started in the late 1950s
and marked the beginning of the co-operative movement in Cambridge
Bay, a community on the southeast coast of Victoria Island.
More than thirty years later, the Co-op is thriving and operates
a number of businesses in the town: a retail outlet that sells
groceries, dry goods, and hardware; a twenty-four room hotel;
a large commercial fishery; an arts and craft outlet; a taxi
and freight service; a commercial bakery; and a cable television
service. During the peak summer season, the Co-op employs
forty-five to fifty full-time staff and is a major employer
of Native people in Cambridge Bay.
William (Bill) Lyall has been involved in the operations of
the Co-op store in Cambridge Bay since 1974. He was elected
to the board in 1981 and now serves as president. Bill attributes
the success of the Co-op to the support of the community,
which has grown over the history of their operations. He feels
that the personal service he and his staff are able to offer
to family, friends, and neighbours in the community of 1,000
people makes all the difference. The Co-op has been able to
return a healthy proportion of its savings, when annual profits
were available for distribution, directly to their customers
as dividends, in recognition of their dedicated support.
The Cambridge Bay Co-op is a member of Arctic Co-operatives
Limited (ACL), an umbrella organization which serves forty-one
member co-operatives operating in the Northwest Territories.
A history of the co-operative movement in the territory and
the Co-op in Cambridge Bay is presented in the following section.
began over 150 years ago in Britain and have grown and even
flourished in some parts of the world. They are a means for
economic activity to be controlled by the workers or co-op
members and they operate on significantly different principles
than those followed by private enterprise. Co-operatives adhere
to six main principles described in a brochure entitled, "The
Co-operative Movement in the Northwest Territories: An Overview
1 Membership in a co-operative is open to
anyone who uses its services and willingly accepts membership
2 A co-operative is administered by people
who are elected or appointed by the members and are accountable
3 Members are issued shares but receive little
or no interest on those shares.
4 When a co-operative has a surplus of earnings
from its operations then this surplus may be reinvested
in the business of the co-op, invested in common services,
or distributed among members in proportion to the value
of their transactions with the co-op.
5 Education of its members, employees, executive
and the general public in understanding co- operative principles
is a priority.
6 Co-operation among co-operative organizations
is encouraged on a local, national, and international
A co-op exhibits a number of unique features, which differ
from a privately owned business. A co-op is owned by its members,
who are often its employees.
Profits are distributed according to the directions of its
members, and a percentage is usually returned to its members
in the form of patronage refunds. Each member has one vote,
and co-operatives thus provide a means to introduce democracy
into the decision making process.
other parts of rural Canada successfully establish co-ops,
the federal government introduced co-ops to the Northwest
Territories in the late 1950s. It was an attempt to establish
an economic base for the indigenous population.
In 1972, twenty-six of the existing NWT co-ops became founding
members of the umbrella organization which later became Arctic
Co-operatives Limited. ACL is a central organization which
provides services to member co-ops, including accounting and
auditing functions, purchasing and marketing assistance, management
support and advisory services, and training and education
for managers and directors. Its mission statement is: "To
be the vehicle for service to, and co-operation amongst, the
Northwest Territories co-operatives; hence, providing leadership
and expertise to develop and safeguard the ownership participation
of the northern people in the business and commerce of their
community, to assure control over their own destiny."
Assets and equity in ACL reached an impressive $14 million
and $5.9 million respectively over the ten-year period from
1980 to 1989. Revenues have grown steadily to more than $35
million in 1989 and net earnings have reached more than $1.6
It is clear, however, that the major recession experienced
in the Canadian economy had a great impact on the financial
health of ACL in the three-year period from 1982 through 1984.
In order to meet this challenge, ACL consolidated operations,
moved its headquarters from Yellowknife to the less expensive
city of Winnipeg, and sold several buildings. These decisions
helped reduce operating costs by more than one-third. In October
1986 the Government of the Northwest Territories wrote off
more that $1.4 million in debt owed by ACL. Many member co-ops
organized aggressive membership drives to ensure the survival
of co-operatives in the territory. ACL has regained financial
stability and is set to continue growing in the future.
Its minimal financial resources created difficulties for ACL
and its members in raising funds to meet the capital needs
of member co-ops. To deal with this situation, the federal
and territorial governments provided $10.2 million in capital
contributions to the Northwest Territories Co-operative Business
Development Fund in 1986. The fund is itself a co-operative,
owned and controlled by Northwest Territories co-ops. Loans
are made available to member co-ops for expansion, refinancing
existing debt, and short-term financing for annual resupply
of inventory. Interest from the loans goes into the fund and
patronage dividends are issued to its members. For example,
for every dollar of income received by the fund in 1989, $0.64
was issued as patronage dividends. There have been no loan
defaults in the history of the fund, which grew to $11.4 million
They are clearly an important source of revenue and employment
for Northerners, with revenues of $44.6 million in 1989.
In 1989, ownership by individuals in their local co-operatives
was at 27.4%, which indicates a reasonable level of equity
invested in the co-operative movement in the Northwest Territories.
On an individual basis, the Ikaluktutiak Co-op has built
up a healthy group of successful businesses. As previously
mentioned, the fishery was the first co-operative endeavor.
It led the way for the construction of the hotel by local
labour in the mid-1970s and then the retail outlet in 1981.
Bill Lyall was hired by the Board of Directors in 1974 to
manage the Co-op, improve services, and reduce pilferage.
At that time, Bill has closed his taxi company because he
had been recently elected as a member of the territorial
legislative assembly. He recalls, "We only had four meetings
a year in those days so I had lots of time on my hands to
get involved with the Co-op."
Bill has taken an active role in the community at the local,
regional, territorial, and national level. He is president
of the local Co-op. He represents six communities at the
ACL Board meetings and sits as President of the Board. He
is also president of the territorial Co-operative Business
Development Fund. Bill sits on the board of Tuttavik, a
joint venture between ACL and La Federation des Co-operatives
du Nouveau-Quebec, wholesaling northern arts and crafts
to southern Ontario. He is also a member of the board of
Northland Utilities and Canadian Airlines North. He is a
past member of the Water Board and Native Economic Development
Program Fund board and past president of the Arctic Coast
Bill was elected president to the board of ACL in 1981 when
80-85% of the co-ops were on the brink of bankruptcy. One
strategy to deal with the crisis, and one, which worked
for the Cambridge Bay Co-op, was a membership drive. The
Co-op now has approximately 460 active members, close to
50% of the community and 90% of the adults.
Bill recalls, "We tried to get more interest in the store
but it wasn't working. In the beginning, people used us
when they couldn't charge anymore at the Bay. We finally
got through to quite a few people that this is their own
business and profits stay right here. We proved that with
the dividend payments." The majority of co-ops survived
the three-year slump in the early1980s and have gone onto
accomplish many of their goals. This has brought Bill a
great deal of personal satisfaction.
Bill enjoys his various positions especially his involvement
in ACL. "There's always some new thing that comes up so
it's an interesting job. I am also very proud that the whole
organization of co-ops is the second largest employer of
native people in the Northwest Territories, after the territorial
government. I think one of the biggest thrills Eskimo people
have with our business is that it's our own business. Generally
native people in the communities own the co-op, but we hire
white people to run the biggest part of it for us. People
see at last, we're not working for the white man, but the
white man is working for us."
A lifetime membership in the local Co-op is available for
$15 to anyone over eighteen years of age with no residence
requirement. As previously mentioned, there are approximately
460 active Co-op members in Cambridge Bay. Once a member builds
up his equity through store purchases to $1,500 then he is
eligible for dividends based on proportion of total purchases.
Equity is allowed to build up to $7,500 and then the member
receives cash for any excess equity that is earned above the
ceiling. Each member receives one vote and may attend the
annual board meeting.
There are nine board members from the community who are elected
for one, two, or three years at the annual meeting. The board
executive includes the president, first vice-president, and
the secretary-treasurer. There are no honoraria because membership
is a volunteer service for the benefit of the community. The
board guides the Co-op's operations and recently drafted a
five-year plan incorporating suggestions from the membership.
Bill notes, "This is one of the new things that we try to
encourage all the co-ops to adopt so that they can continue
The board meets once month and handles complaints, policies,
planning, and other issues of interest. With management handling
the follow-up of these matters. Bill states, "I might talk
to drivers going too fast or to a kid who is stealing stuff
out of the store. The board of directors give a lot of direction
The major source of revenue is generated from the retail grocery
outlet. In 1989, retail sales were 69% of total sales, with
the hotel revenues at 15%. The fish plant generating 9%; and
general contracts, including the cable service and delivering
mail between offices and the airport for the government, accounting
for 7% of total revenues.
John Senow, a merchandising specialist with ACL, is the temporary
general manager in the retail outlet. He has thirty-six years
of experience in the wholesale and retail sales and store
engineering. He freelances for ACL when a store needs his
help, for example with staffing, cash flow, or low sales.
He expects to be in Cambridge Bay until September 1990, when
they hope to have hired a general manager and produce manager
for the Co-op.
John is streamlining operations. "I will do a stock relocation
which means relocating all similar products together and generally
improving the functional end of the business." The retail
outlet is 10,000 square feet and carries groceries and dry
goods. It has a loading dock, storage space, an office, an
arts and craft outlet, and a sewing centre. It is the second
largest retail co-op in the territory.
Any Co-op member may have an account with the store. The usual
amount charged is $150 every two weeks. Very few people have
accounts over $500 and Bill monitors account levels very closely.
He says, "We do not send bills that accounts are overdue the
way that Northern Stores does. It is a personal touch, because
if you keep sending somebody bills marked overdue they won't
pay. If someone is slow paying then I go personally and see
what payment plan can be worked out. Generally they respond
The craft shop is handled by the administration office. Two
staff people order crafts from Canadian Arctic Producers for
the tourist market. (Canadian Arctic Producers is the arts
and crafts wholesale marketing arm of ACL and Northern Images
handles the retailing of these goods.) There are four local
carvers but they do not create a large number of items. Bill
notes, "The government tried to start carving here with the
attitude that all Eskimos are carvers. That's not true. They
soon found out that we weren't all carvers. We hire women
to do some sewing in the wintertime."
don't mass-produce products like we used to because it tied
up a lot of cash. What we do now is produce smaller items,
for instance, lots of duffel bags that can be sold quickly."
John adds, "Right now we have quite an inventory of fabrics
and skins. We've already got some ladies started on using
sealskin for men's vests and we'll see how they turn out.
[The vests] don't require much time and there is a demand
for them. Now, with the weather turning colder, we can go
into more products such as seal skin slippers, mitts and gloves.
We also buy finished products from the community if we think
that there is a market for them."
Bill manages the fishery, which operates seven days a week
from the first week in July until the first week in September.
He is the only person with the expertise to maintain the equipment,
so he is on call throughout the whole season. Seven to ten
fishermen are hired to net the arctic char. The fish are gutted
and gilled before being flown to the fish plant and trucked
in to be weighed, washed, hung, and freeze-blasted. After
freeze-blasting, they are graded according to size: two to
four pounds, five to seven pounds, eight to ten pounds, and
over ten pounds.
The fish are boxed in packages of seventy-five pounds each
and stored until there is enough inventory to be shipped to
the Freshwater Marketing Corporation in Winnipeg or to fill
orders from other communities. The Freshwater Marketing Corporation
is a Crown corporation that was formed to market all fish
caught in the Northwest Territories for export to markets
in Canada and the world. Orders are filled as promptly as
possible due to high power costs associated with plant operations.
The fishery provides seasonal employment for about seventy
people in the community, including the fishermen. All age
groups are hired to work in the plant, including students,
as long as they can see over the sink to wash fish.