By Mary Carpenter • Photos by Jessica McCafferty
What happens when a 130-year-old, fourth generation company recognizes there is not going to be a fifth generation to take over? That was the dilemma the Ward family of Ward Lumber Company in Jay, New York faced in 2018. What was their exit strategy? Merge? Sell? Liquidate? Was there another option? It turned out there was.
Company president Jay Ward learned about and researched the idea of a worker-owned cooperative. What he found interesting was that it would put the company’s future, operations and profits in the hands of the dedicated men and women who were its backbone. Once he understood what it would take to make the transition a success, he presented the idea to the company’s employees.
To learn their reaction, I recently sat down with Kevin Kennedy, the company’s IT manager and current president of the Ward Lumber Worker Cooperative Board of Directors. “We thought he was crazy,” Kennedy said with a laugh. “We were all good at our jobs, but what did we know about how to run the company? Jay had always been deeply involved in the operation and we had looked to him as the final decision maker.”
Initial skepticism soon gave way to a desire to learn more and a steering committee was formed to investigate the idea. “We reached out to the Cooperative Development Institute (CDI) based in Northampton, MA for guidance,” Kennedy explained. “They had been creating economic development opportunities for communities in New England for 30 years. Their help was invaluable. They walked us through every step of the process. We couldn’t have done it without them.”
Kennedy continued, “We wanted to create a way to take care of the employees and to shelter the community from a loss of the company that had played such an important role in the region for more than a century.”
Once the group embraced the idea, it was time to break the process down into manageable increments. Ward was asked to stay on for two years “The buyout meant taking on debt,” Kennedy observed. “We knew having him with us would help with financing and reassure the bankers. Since most loans require principals to personally guarantee borrowings, we needed a lender that had experience with companies like the one we were proposing.” CDI put them in touch with the Cooperative Fund of New England (CFNE), a mission based, community development loan fund that facilitates socially responsible investing in cooperatives, community-oriented nonprofits and worker-owned businesses in New England and New York.
With the help of CDI and CFNE, the group was able to establish a value for the business, negotiate a purchase price with Ward, set up the structure for a Board of Directors to be elected by the members, and create bylaws that would set them on a path forward. All employees were invited to become worker members. Of the 52 employed at that time, 43 chose to join, each one paying a low buy-in fee. Each member received one share, which gave them a vote on policies and procedures.
While the planning was ongoing, COVID was making life difficult for everyone, but finally, in March 2021, everything came together and the Ward Lumber Employee Cooperative became the first of its kind in the building industry.
I asked Kennedy how things have changed in the past three years. “I’d say we have become more forward thinking, while at the same time maintaining the company’s family feel. Our employees are stronger and more flexible. People have learned to make good decisions on their own.”
The structure of the organization has broadened to include committees on finance, governance, transition, donations, and engagement. “With two operations — one in Jay and one in Malone — it is important for all employees to get to know each other, to have a sense that we are all in this together and are committed to the company’s long-term goals,” Kennedy said. To help with a sense of belonging, Ward employees will gather at Fish Creek this summer for the annual company BBQ.
The criteria for membership in the Co-op have changed. Initially all employees were eligible to join. Now employees must have a minimum of six months on the job, work with a mentor and learn the bylaws.
“Our current Board of Directors is made up of seven hard working employees who serve three-year terms,” Kennedy observed. “With their relationships and the technical assistance from service providers and industry advisors, the Board continues to guide the company culture and oversee its governance.”
A year-long national search for a new CEO began in 2022 in anticipation of Jay Ward’s retirement. “Our ideal CEO candidate was someone who had experience and connections in the building materials industry and also in family-owned business,” Kennedy shared. “We wanted someone with a big view and we found it in Bryan Mellick. He brings a wealth of leadership experience, including a decade in the lumber business, time working in technology and management consulting, and he’s been an entrepreneur.” Mellick began his full-time work with the Co-op on January first of this year and has been warmly received by members.
The transition from company to co-op has been a great motivator for the Ward leadership team, one that has inspired them to pay forward the help they received. Kennedy and another worker/owner recently participated in the 22nd Vermont Employee Owners Conference (VEOC) that attracted both potential buyers and sellers. “At a time when many owners are aging out, a co-op can be a viable opportunity,” Kennedy observed. “We were part of a panel that discussed our experience with leadership transition.” Jay Ward also speaks to interested businesses about the opportunities and benefits of cooperatives.
Since its creation, the Ward Lumber Worker Co-op has experienced a 40 percent increase in sales and an impressive increase in net profitability which has provided a strong financial position for its employee owners. Its strength continues to be its solid management team, experienced employees and commitment to the communities it serves.
Asked about future plans, Kennedy emphasized, “We are investigating growth opportunities, efficiencies, new product lines, and acquisitions. We are a community resource. Our communities were hugely supportive of our conversion to a co-op and we take our commitment to the areas we serve very seriously.”
Introducing Bryan Mellick, Ward Lumber Worker Co-op’s New CEO
If there is such a thing as a perfect fit — or close to it — Bryan Mellick may be it. A decade in the building supply industry, along with work as a consultant advising companies how to improve, brought him to the attention of Ward’s recruiting committee in 2023. “I learned about the job at a perfect time in my life,” he offered. “We had just dropped our son off at college and my wife and I were thinking about the next chapter in our lives.”
As a resident of New England for more than two decades, Mellick knew about the Adirondacks. “I knew it was a great place to live and the idea of working for a company that had been around since the 1800s intrigued me. Much of my career had been spent working with companies the size of Ward Lumber.”
Mellick’s professional background included an undergraduate degree from the University of Richmond and an MBA from the College of William & Mary. In addition, he spent a year in the Global Executive Education Leadership program at Yale.
The interview process went well. “Our conversations were direct and open,” he explained. “Their goals and mine were a good fit and we quickly came to a meeting of the minds.”
On January first Mellick stepped into his new role as CEO of WLWC, a company he describes as mission-driven. “Co-ops have become more popular in recent years and I look forward to helping this organization get better and better.”
Strictly Business is pleased to welcome Bryan Mellick to the North Country business community.
Ward Lumber Worker Cooperative
697 Glen Road
Jay, NY 12941
518 946-2216
3240 State Route 11
Malone, NY 12953
518 483-8888
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