Futurecoops

Co-operatives are the future, says development agency

Michael Fairclough and Angela Davies of the Co-operative Fund, who spoke at a conference in Swindon recently

More and more small and medium sized firms are abandoning traditional business models and becoming co-operatives, says an agency formed to develop them.

And the south west co-operative movement is expanding more quickly than any other region in the UK, says Co-operative Futures, a Gloucester-based agency, funded by Midcounties Co-operative Ltd, which promotes the co-operative business model across Gloucestershire, Swindon, Wiltshire and Oxfordshire.

Co-director Jim Pettipher said: “With the banking sector in crisis, companies going to the wall and unemployment topping two million, SME owners, and people setting up on their own, are looking for a more sustainable business model.

“The south west is currently the fastest growing region in the co-operative movement, and Co-operative Futures is responsible for the most new business creations in that region. Since September last year we have helped create eight new co-operatives, and we’ve never had so many enquiries.”

Jim’s views are echoed by Michael Fairclough of the Co-operative Fund, who spoke at a conference in Swindon recently. Hailing the dawn of a ‘co-operative renaissance’, he told delegates: “Companies are being bailed out by shareholders and nationalisation is being talked about for the first time in years.

“This signifies a fundamental change in capitalism. Meanwhile, the co-operative movement has an alternative business model; an old answer to a modern problem.”

There are several different kinds of co-operative. They can range from a community buying its village shop or pub to a workforce buying out its company.

Meanwhile, inspired by a different way of doing business and encouraged by the recent reduction in the cost of incorporation – from £400 to £40 – more and more start-ups are investigating the co-operative model.

Recent co-operative start-ups include community shops in Horsley and Chalford, both near Stroud, Oxford Cycle Workshop, which repairs and resells used bikes, We Love Marlborough, a company promoting the arts in the Wiltshire town, and Moonshare, a Wiltshire and Gloucestershire-based network and resource for environmentalists, artists, writers and eco activists.

“All co-operatives are different, but what they have in common – and what differentiates the co-operative model from other business models – is what really matters,” said Jim.

“They are owned by the members, so do not answer to external shareholders. Although they are created to make a profit, that profit is shared by the workforce or ploughed back into the business or community.

“If the worst comes to the worst and cuts need to be made, it is not uncommon to find all employees taking a pay cut rather than enforcing redundancies. Everyone has an equal say in the way the company is run, and everyone has an equal stake in its success.

“Then there are the values of the movement. Co-operative is the untold story of ethical trading. Like fair trade and organic, both of which the co-operative movement was an early supporter, customers are assured that they are buying products or services from a company that has ethical, social and environmental values.”

The co-operative movement might also offer companies a ready-made customer base. “Co-operatives like doing business with other co-operatives,” said Jim. “It’s enshrined in the principals of the co-operative movement.”

The ‘co-operative renaissance’ has recently been given a major boost by the movement’s most high-profile member. Co-operative Retail has taken over the Somerfield supermarket chain, doubling the size of its food market.

A £10 million advertising campaign, meanwhile, highlights a three-point community plan: the fight against climate change, the alleviation of poverty overseas and the positive contribution to society of children in the UK.

But co-operative is not all about the supermarkets. The movement employs 237,000 people in 4,735 businesses, with a combined turnover of £27.4 billion and £9.2 billion in assets – figures that will only increase as more business owners see the benefits of the co-operative model.

Anyone starting, running or growing a business that is interested in co-operative status can contact Jim Pettipher from Co-operative Futures on 0845 456 2506 or at jim.pettipher@co-operativefutures.coop

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