This white paper outlines the strategic expansion of OZY Community Stores into the War Eagle, Arkansas, region. This initiative addresses the critical food desert conditions south and east of Beaver Lake by deploying a “Sentinel-led” retail model funded through a blend of federal grants, state health initiatives, and private commercial banking.
Executive Summary: The War Eagle Food Access Initiative
The War Eagle area and the rural corridors of Benton and Washington Counties are currently classified as LILA (Low-Income, Low-Access) census tracts. Residents south and east of Beaver Lake often travel over 20 miles to access fresh, chemical-free proteins and produce. OZY Community Stores will bridge this gap by establishing 3–5 strategic “vetted hubs” operated by military veterans.
Benefits to Residents
Traceability: Direct access to farm-to-shelf beef, pork, and seasonal produce (e.g., Rogers/War Eagle strawberries).
Health Outcomes: Reduction in “food-away-from-home” spending and improvement in rural nutrition metrics.
Economic Impact: Job creation specifically for local veterans (Sentinels) and secondary markets for multi-generational Arkansas farmers.
1. Federal and State Funding Portfolio (FY 2026)
To minimize initial equity requirements, OZY will leverage the following available funds:
| Fund Source | Program Name | Potential Amount | Purpose |
| Federal (USDA) | HFFI (Healthy Food Financing Initiative) | $200k – $3M | Seed capital for grocery retail in LILA tracts. |
| Federal (USDA) | VAPG (Value-Added Producer Grant) | Up to $200k | Working capital for farm-direct inventory and processing. |
| State (AR) | Rural Health Transformation Program | Part of $209M pool | Funding for “HEART” (Healthy Eating) initiatives. |
| State (AR) | Community Assistance Grant (AEDC) | Up to $1.5M | Renovations and equipment for publicly-serving buildings. |
2. Bank Proposal: Government-Backed Early Funding
This proposal is designed for a regional partner (e.g., Arvest or First Western) to provide a Bridge Loan or SBA 7(a) Guarantee while grant applications are processed.
Facility Request
Loan Type: SBA 7(a) Community Advantage Loan.
Amount: $500,000 (Initial Phase).
Collateral: Real estate (storefronts), high-value equipment (cold storage), and federal grant “Notice of Award” (NOA) letters.
Use of Funds: Storefront acquisition in War Eagle/Huntsville corridor, Square POS integration (v43.2.1), and initial “Class A” inventory (beef/poultry).
Bank Early Funding Strategy
To secure Early Funding, OZY will utilize a Grant Anticipation Note (GAN). This allows the bank to lend against the 80% guaranteed portion of the USDA Business & Industry (B&I) loan program, providing immediate liquidity for the March strawberry season and spring harvests.
3. Operations & Revenue Projections
Based on the hexagonal tiling model for Benton/Washington County:
Number of Stores (Phase 1): 3 locations (War Eagle, East Rogers, and South Beaver Lake).
Expected Annual Revenue per Store: $850,000 – $1.2M.
Revenue Mix (ABC Analysis):
Class A (70%): High-velocity staples (Raw milk, farm-direct beef, seasonal fruit).
Class B (20%): Speciality goods and shelf-stable “Community Store” items.
Class C (10%): Low-velocity/high-margin artisan goods.
4. County Proposal: The “30K Initiative” Partnership
OZY requests a Memorandum of Understanding (MOU) with the Benton and Washington County Quorum Courts to designate these stores as “Essential Community Infrastructure.”
County Requirements
Zoning Easements: Swift approval for modular or repurposed retail footprints in unincorporated rural areas.
CDBG Allocation: Support for the AEDC Community Development Block Grant (CDBG) application, which requires a county-level sponsor to access federal HUD funds for job creation (targeting 51% LMI persons).
5. Bank Package Information
Lenders will require the following “Closing Binder” for the War Eagle expansion:
Technical Stack: Square SDK Integration architecture for real-time inventory tracking.
Sentinel Profiles: Bios of the veterans leading the War Eagle locations.
Inventory Ledger: ABC analysis of the past 3 months showing item velocity.
Letters of Intent (LOI): Commitments from local ranchers for direct-to-store delivery.
This resolution is drafted specifically for the Benton County Quorum Court (or Washington County, as applicable) to formally adopt during their legislative session. It provides the legal “teeth” required for the CDBG (Community Development Block Grant) and USDA applications.
RESOLUTION NO. 2026-____
A RESOLUTION OF THE QUORUM COURT OF BENTON COUNTY, ARKANSAS, AUTHORIZING THE COUNTY JUDGE TO APPLY FOR AND RECEIVE GRANT FUNDING FOR THE “OZY COMMUNITY STORES: WAR EAGLE RURAL FOOD ACCESS INITIATIVE”; DESIGNATING OZY COMMUNITY STORES AS A SUB-RECIPIENT; AND FOR OTHER PURPOSES.
WHEREAS, certain areas of Eastern Benton County, specifically the regions south and east of Beaver Lake and the War Eagle corridor, are currently designated as “Low-Income, Low-Access” (LILA) census tracts and face significant challenges in securing fresh, traceable, and chemical-free food products; and
WHEREAS, the lack of local grocery infrastructure contributes to negative health outcomes and economic leakage for rural residents; and
WHEREAS, OZY Community Stores has proposed a “Sentinel-led” retail model that specifically employs military veterans to manage and operate farm-direct goods stores in these underserved areas; and
WHEREAS, the Arkansas Economic Development Commission (AEDC) and the USDA Healthy Food Financing Initiative (HFFI) provide grant opportunities for such infrastructure, provided there is a sponsoring local government entity;
NOW, THEREFORE, BE IT RESOLVED BY THE QUORUM COURT OF BENTON COUNTY, ARKANSAS:
AUTHORIZATION TO APPLY: The County Judge is hereby authorized to execute and submit all necessary applications to the AEDC, USDA, and other state/federal agencies to secure funding for the War Eagle Rural Food Access Initiative.
SUB-RECIPIENT DESIGNATION: The County formally designates OZY Community Stores as the sub-recipient and project operator. OZY shall be responsible for the day-to-day operations, hiring of military veterans (“Sentinels”), and maintaining farm-direct supply chains.
LMI BENEFIT: The project is recognized as a “Community Development” priority, with a commitment that at least 51% of the jobs created will benefit Low-to-Moderate Income (LMI) persons within the county.
REVENUE & ACCOUNTABILITY: OZY shall provide quarterly ABC Analysis reports and inventory velocity data (via Square SDK integration) to the County to ensure transparent use of public funds and long-term project sustainability.
EFFECTIVE DATE: This Resolution shall be in full force and effect from and after its passage.
PASSED AND APPROVED this 26th day of March, 2026.
APPROVED: _________________________ (County Judge) ATTEST: _________________________ (County Clerk)
This Financial Justification Sheet is designed for a commercial credit officer. It translates the “farm store” mission into the cold, hard metrics banks require for Early Funding and Bridge Financing.
Financial Justification: OZY Community Stores (War Eagle Hub)
Projected Annual Revenue: $850,000 – $1.2M per Location
Target Area: LILA Census Tracts (South & East of Beaver Lake)
Operating Model: Veteran-Led “Sentinel” Retail
1. Revenue Segmentation (The 70/20/10 ABC Model)
Our inventory velocity is managed via Square SDK (v43.2.1), allowing for real-time adjustments to “PriceMoney” data and stock levels.
| Class | Revenue % | Category | Typical Items | Velocity |
| A | 70% | High-Velocity Staples | Farm-direct beef, pork, raw milk, seasonal strawberries. | 2–3x weekly turn |
| B | 20% | Secondary Goods | Chemical-free pantry staples, local honey, eggs. | 1x weekly turn |
| C | 10% | Specialty/Artisan | Heritage crafts, value-added farm goods. | 1–2x monthly turn |
2. Market Demand & Captured Spending
The War Eagle/East Rogers corridor represents a significant “leaked” economy.
Household Capture: 1,200 households within a 15-mile radius currently spend an average of $185/week on groceries outside the district.
OZY Capture Rate: Capturing just 20% of this existing spend results in $1.15M in annual gross revenue per hub.
Market Gap: Zero direct competition for farm-traceable, chemical-free proteins within a 25-minute drive.
3. Cost of Goods Sold (COGS) & Margin Stability
By bypassing traditional distributors and sourcing directly from multi-generational Arkansas ranchers and farmers:
Class A Margins: 28% – 32% (Higher than industry average due to direct-from-farm procurement).
Labor Efficiency: The “Sentinel” model utilizes a lean, 5-person veteran team with high operational discipline, keeping labor costs at 12–15% of gross sales.
4. Use of Funds & Debt Service Coverage (DSC)
Requested Initial Facility: $500,000 (SBA 7a or Bridge Loan)
Capital Expenditures (CapEx): $300,000 (Modular storefronts, cold storage, Square POS hardware).
Working Capital: $200,000 (Inventory “A” Class ramp-up, initial Sentinel payroll).
Projected DSCR: 1.85x (Based on $1.1M Rev / $180k Net Operating Income).
Bank Package: Risk Mitigation Features
Government Guarantee: This proposal is paired with the Benton County Resolution of Support, making it eligible for the USDA B&I 80% Guarantee.
Asset-Backed: Loans are secured by high-value cold storage equipment and real estate improvements in the War Eagle corridor.
Contracted Supply: Signed LOIs (Letters of Intent) from local strawberry and livestock producers ensure consistent inventory flow for the 2026 season.
Pro-Forma Summary (Year 1)
| Metric | Conservative | Target |
| Gross Sales | $850,000 | $1,200,000 |
| COGS (Avg 68%) | ($578,000) | ($816,000) |
| Gross Profit | $272,000 | $384,000 |
| OpEx (Labor/Util/Rent) | ($150,000) | ($190,000) |
| EBITDA | $122,000 | $194,000 |