Co-op businesses are better placed to weather the post lockdown economic storm, according to a study published today, 5 June.
The annual Co-op Economy report reveals that co-ops have almost double the chance of surviving the first five years when compared to other start-up businesses. Compiled by sector body Co-operatives UK, the report shows that 76 per cent of co-ops (up from 72 per cent in 2019), are still operating after the difficult first five years of existence. Just 42 per cent of all new companies make it beyond five years.
Co-ops are organisations owned and controlled by their members. Their collective decision making and more rounded approached, as opposed to just fixating on maximising profits, give them a distinct advantage as the UK economy recovers from the Coronavirus pandemic.
The UK’s 7,063 co-ops operate across all sectors, from community-owned pubs to multi-billion pound high street retailers and professional services providers, from the nation’s biggest farmer owned agriculture businesses to supporter-owned football clubs. They have a combined turnover of £38.2bn (up £500m from 2019) and 14 million people are members of a co-op – the equivalent to more than a fifth of the UK’s population.
The largest co-op is the Co-operative Group with a turnover of £10.9bn followed by the John Lewis Partnership (turnover £10.2bn) and the farmer-owned Arla Foods (£2.6bn).
Steve Murrells, CEO of the Co-op Group, said: “Co-op’s already play an important role in the social and economic fabric of our country, and the Co-op Economy report illustrates that they are well placed to face into the difficult economic conditions that lie ahead in the post lockdown world.
“Co-ops are in existence to create value for their members and their communities and are not just about maximising profits for shareholders. All businesses now face unprecedented challenges, but the fact that many co-ops have community-based ownership means more people are invested in their long-term success.”
Throughout the coronavirus crisis, the Co-op has continually demonstrated its community support with a series of initiatives including establishing a Members’ Coronavirus Fund to support foodbanks, address funeral poverty and help local causes, by creating temporary jobs for more than 7,000 people out of work and through launching Co-operate, an online community centre.
Murrells added: “Our response to the emergency in the last few months was built upon our Co-op values and principles and ongoing commitment to our members across the UK. When this crisis broke, we weren’t starting from scratch, we were already ‘on the ground’ with good relationships and existing resources in place.
“We didn’t need to invent a local Community Fund, appoint hundreds of Member Pioneers to support communities, or develop a Community Wellbeing Index to provide unique local insight. Those assets were already in place because our purpose extends beyond maximizing commercial profits.”
Nick Matthews, chair of Co-operatives UK, said: “There’s an appetite for a different economy to emerge from this crisis, with many people talking about the need to ‘build back better’. If we are to rebuild a fairer economy, provide decent livelihoods and support communities we need more co-ops, mutuals and social enterprises, not less. And there’s compelling evidence to show that new co-ops are built to last.”