The Co-op Group has been criticised by unions and some members of the co-op movement after the announcement of a new partnership with Amazon to accelerate its e-commerce strategy.
The move, which comes alongside an expansion of its robot delivery service, is part of a plan to more than double online sales from £70m to £200m by the end of the year.
Amazon Prime customers will be able to buy groceries from the Group on Amazon, with same-day delivery and two-hour scheduled time slots. Initially launching in Glasgow – including surrounding areas such as Hamilton and Paisley – the initiative will be rolled out to other parts of the UK before the end of the year, with an ambition that it will become a nationwide service.
The Group has also confirmed the extension of its partnership with Starship Technologies, the delivery robot company launched by the co-founders of Skype, which allows the delivery of groceries in as little as 20 minutes. The retailer says this will bring a dramatic reduction in carbon emissions, and plans to increase the number of autonomous vehicles operating and delivering Co-op groceries from 200 to 500 by the end of this year, bringing them to five new towns and cities, including in Cambridgeshire, and extending the service into the north of England.
Co-op Group CEO Steve Murrells said: “The pandemic has accelerated changes in consumer shopping trends and we’re driving forward with exciting plans to provide rapid kerb to kitchen grocery delivery services.
“We are delighted to be working with Amazon. Its reach and leading technology and innovative approach mean greater convenience for people in their communities. This, combined with our extended partnership with Starship Technologies, marks a significant milestone in our online strategy.”
But the GMB union, which has been campaigning for better workers’ rights for Amazon staff, has slammed the move. National officer Andy Prendergast said in on the union’s website: “It’s really disappointing to see a company with a proud ethical heritage like Co-op teaming up with Amazon. Bosses won’t even recognise a union to improve the health and safety of their beleaguered workforce.
“Co-op customers will be rightly shocked by who the supermarket is getting into bed with.”
A Co-op spokesman said: “We aren’t compromising our ethics and principles and the extension of the partnership is about getting our ethically sourced products into the hands of more people.”
He added that the Co-op Group saw the partnership as a means to tackle issues including climate change and “youth skills and opportunities”.
The Group has previously drawn criticism for using the controversial platform Deliveroo for its home delivery service. Deliveroo and Amazon are two of the companies regularly targeted over their working practices by the growing platform co-op movement, which is working to set up worker-owned alternatives.
Among the organisations working to develop the platform co-op model is the UK’s Open Co-op. Co-founder Oliver Sylvester-Bradley said: “The real question is why the Co-op Group thinks this is acceptable behaviour for a ‘co-op’? How are they not compromising co-operative ethics and principles?
“The partnership completely ignores the co-op principles, especially principle 6 which states that ‘co-ops serve their members most effectively and strengthen the co-operative movement by working together’ – working with Amazon is the complete opposite of supporting the co-operative movement.”
He added: “Principle 7 states ‘co-operatives work for the sustainable development of their communities through policies approved by their members’. Did the Group’s members approve this partnership with Amazon? It seems highly doubtful.”
Mr Sylvester-Bradley also disputed the notion that the move would help tackle climate change. “Amazon are not tackling climate change in any way – if anything they exacerbating the problem by encouraging consumerism and increasing the number of delivery trucks on our roads.”
Rob Harrison from Ethical Consumer Research Association, which publishes Ethical Consumer magazine, said: “It is of some concern to see one of the UK’s most precious ethical business assets wander like a child into the garden of one of the most predatory corporations the world has ever seen. It is difficult to see how this will turn out well for the Co-op Group in the longer term. Members will doubtless become engaged around this for some time to come.”
He added that the Co-op Group is one of Ethical Consumer’s recommended buys for larger food retailers, while Amazon is the target of a boycott call by Ethical Consumer for its use of legal tax avoidance measures to reduce its UK tax contributions.
“Our advice in the short term would be to buy food from the Co-op, but not to buy it online and through Amazon,” he said.
Co-op spokesperson Russ Brady commented: “Our Co-op vision of Co-operating For A Fairer World has never been more relevant and over the past few years our Co-op has responded magnificently in supporting the needs of our members and their communities. Whether that’s been through our cutting-edge climate plan, our pioneering approach to tackling food poverty or our leadership position in supporting youth opportunity, our Co-op way of doing business has been our North Star throughout.
“For us to go even further with our vision in the years ahead, we equally have to succeed as a strong consumer co-op, one which is delivering products and services for its members, through channels of their choosing. Our e-commerce strategy is vital to this and sits across all of our business areas. The recent Amazon announcement is part of our exciting and ambitious goal to more than double our E-comm revenue this year and then treble it again by 2024.
“It is just one of a number of routes in which members and customers can trade with us electronically, including our own Co-op online platform, which accounts for a large portion of sales. In using the Amazon platform we are providing the means for Amazon customers to buy our ethically sourced products, not the other way round. We are therefore increasing our Co-op footprint, in a capital-light manner, rather than reducing it.”
He added: “Amazon are one of a number of partners we will continue to work with across our business in support of our vision. They have a stated goal to contribute positively to society and like all of our current and future partners, we look forward to working with them in a truly co-operative and mutually beneficial way.“
An Amazon spokesperson said: “We are proud to offer excellent pay, benefits and opportunities for career growth, all while working in a safe, modern work environment. Our competitive wages start at between £10 and £11.10 per hour depending on location.
“We are proud that over 55,000 people have chosen Amazon as their employer in the UK and recommend Amazon as an excellent workplace to their family and friends. Our continued investment in the UK, £32bn since 2010, helped contribute to a total UK tax contribution of £1.5bn during 2020 – £492m in direct taxes and £1.06bn in indirect taxes.”