150 years of the co-operative group
TRANSCRIPT
Tony Webster (Liverpool John Moores University)John Wilson (University of Newcastle)
Rachael Vorberg-Rugh (The Co-operative College)
150 years of the Co-operative Group: Seeing the future from the past
The Co-operative Business History ProjectOct 2013: the first major Business History of the English
Co-operative Wholesale Society & Co-operative Group 1863-2013 – to coincide with 50th anniversary
Why? 1950-1990s years of decline & the dominance of the ‘investor-led’ model of the private firm neo-liberalism – BUT since then – Renaissance!
1990s – reorganisation & the emergence of the new ‘Co-operative’ identity; success of Co-op Bank; mergers with Britannia Building Society & Somerfield – takeover of Lloyds TSB branches
The crash of 2008 & the revival of the co-operative idea – ‘Big Society’ – the ideal time for a reappraisal
The long journey of British co-operation‘Rise & Reign’ - British co-operative development,
1850s-1950s
‘Retreat’ - co-operative decline, 1960s-90s
‘Renaissance’ - reversal of fortunes since 1990s
First CWS offices, Manchester, 1863
CWS headquarters,1913
Rise & reign of British co-operation (1)Response to the socio-economic changes of
industrialisation by workers & artisans – spread across Britain, especially N. England
Strong influence, Owen & Christian SocialistsThe Rochdale Pioneers – ‘Rochdale Principles’
of consumer co-operation 1850s – proliferation of societies,
supply issues1863 – formation, Co-operative
Wholesale Society (CWS)
Rochdale Pioneers Museum
The Rochdale Pioneers
The Rochdale PrinciplesOpen membershipDemocratic control – one member one vote regardless of
size of investmentFixed interest on capital - shares invested in the society
received a low, fixed rate of interestDividend on purchases - - part of trading surplus used to
pay dividend to members, based on purchases not sharesSale of unadulterated goodsReligious & political neutralityCash not creditEducation
Growth of British co-operation
The trader: Here, missis, you may be a ‘social miracle’ but you take up a lot of room
Daily Dispatch (May 25 1904)
CWS – wholesaling to co-op societies; by 1870s, production & CWS Bank
International depots by 1870s/80s (New York, Copenhagen, Rouen, Hamburg) – sourcing meat, fruit, wheat, flour (Greece), cheese & butter (Ireland)
National reach – Newcastle & London branches, system of saleroom & depots
Scottish CWS (1868); establish joint work, 1874
Rise & reign of British co-operation (2)
CWS London branch c1881
First CWS factory, Crumpsall, 1871
Early 20th century co-operative store
The CWS-owned SS Unity, 1904
Co-operative Congress, 1895
Development of CWS production – shoes (Leicester, Heckmondwike); drapery (various), flour (Dunston mill); ceramics
...some failures! Coal mines in 1870sCWS = a bridge between producer co-op societies
& local consumer co-ops – not always successful
Expanding global reach – tea plantations in Ceylon(Sri Lanka) early 1900s; palm oil in West Africa
Rise & reign of British co-operation (3)
Workers at CWS tea plantation, Ceylon, 1903
CWS operations, c1920
= distributive (salerooms, depots, etc)
= productive (factories, farms, etc)
Biscuits
Bacon
Tea
Zenith = World War Two!Walton & Gurney –importance of social & educational
activities in cementing a ‘culture of co-operation’ – important in ensuring local co-op consumer loyalty
Political dimension – committed to non-partisan neutrality at first – but effects of capitalist hostility & other issues lead to creation of Co-operative Party, WW1
Eventually allied to Labour – an uneasy relationship – because of Labour’s statism & TU links
Problems post WW2 – growing competition – Co-operative Independent Commission 1958
Rise & reign of British co-operation (4)
Poster, c1940s
CWS adverts, c1930sCWS Band, c1940s – co-operative bands and choirs date back to the 19th century
Children’s parade, c1930sCWS Travel Department, established 1937
1960s-1990s – a period of difficulty!Failure to implement CIC reforms & unify movementDeath of reformist CEO Thomas,19681973 – merger SCWS & CWS (financial crisis) –
CWS moves into retailingCo-operative Bank – becomes
mainstream bankCo-operative society mergers
(financial problems; piecemeal & unplanned) 1960 = 875 societies,1980 = 200
Retreat, 1960-1990 – and its roots (1)
Former SCWS headquarters, Glasgow
Co-operative market share
High of 21% in 1950s; low of 4.4% in 2000; 5th largest UK food retailer with 8% market share in 2010
First meeting, Co-operative Commission, 1955
Earlyself-service store, Pendleton, c1950s
Counter service, c1940s
Promoting bakery & milk deliveries, London (left) & Worcester (right), c1950s
Emergence of Co-operative Retail Society (CRS) as a rival to CWS
Longstanding problem of dispersal of power – Co-operative Union, CWS & CRS – hard to achieve coherent leadership & direction
UK co-op society formation in mid 19th century – an already mature & competitive environment
The primacy of ‘localism’
Retreat, 1960-1990 – and its roots (2)
Dividend token,CRS Swansea
Bus adverts, Co-operative Bank, 1971
Dividend stamps promotion, 1970
Leeds’ £100,000 computer (left), and Addlestone’s supermarket, both c1960s
CWS vs local societies – differing views of CWS’ role
Co-op societies preferred variety of suppliers; CWS aspired to be main or even sole supplier
DYSFUNCTIONAL FEDERATION
Late 20th century, mergers = emergence of large regional societies with aspirations for greater independence from CWS! (Ekberg)
Problems of internal conflict & poor leadership
Retreat, 1960-1990 – and its roots (3)
CWS experimental supermarket, c1960s
Superstore in Oldham, c1980s
Department store, c1980s
Lancastria convenience store, c1980s
Supermarket in the Midlands, c1980s
Co-op Bank & Fair Trade – ethical commerce!1993 Co-operative Retail Trading Group (CRTG) –
CWS & several large regional societies - co-ordinated buying for member societies
Sale of CWS manufacturing to Hobsons (Regan)Mid 1990s, Melmoth at CWS & re-establishment of
co-operative values & identity1997 – defeat of Lanica takeover bid
– the new approach is strengthenedThe emergence of the ‘family of
co-operative businesses’ concept
Renaissance – the 1990s (1)
Co-operative storefront, 2011
Andrew Regan (far left), Graham Melmoth (left), and some of the newspaper headlines during the attempted 1997 takeover of CWS (top left)
All co-operative brand chocolate & coffee were certified Fair Trade in the 2000s
2000 – new Co-operative commission = confirms the revival of a distinctive co-operative identity
Focus on convenience stores in retailing2002 – merger of CWS & CRSMerger of CIS & Co-operative Bank
to form CFS, also 20022002 – the Co-operative Group –
much more integrated and cohesive commercial organisation
2009 – Somerfields acquisition, CFS merger with Britannia Building Society – general revival of fortunes!
2012 - Lloyds-TSB branch acquisitions
Renaissance – the 2000s (2)
The Co-operative Group’s 1st annual report
The first meetingof the Co-operative Commission, 2000& its report, 2001
Co-operative Group advertising, 2009
HQ of the CWS since 1963 (left); drawingsfor new Group HQ, to open in 2012
‘Falling to the centre’ – concentration of societies = eventually made the emergence of unified leadership easier to achieve
Helped by the process of late 20th century retreat & decline! A growing sense of urgency for change
Changes in leadership – a new generation – the survival of the co-operative ideal – both in membership and in a rising generation of managers
Avoided demise as in France, Austria and Germany
Renaissance – Why?