Lincolnshire Co-operative discovers that 40% of income is recycled in the local economy

Lincolnshire Co-operative discovers that 40p in every £1 spent in stores is recycled in the local economy. Chief Executive Ursula Lidbetter writes about the research . . .

Lincolnshire Co-operative finds that 40p in every £1 spent in stores is recycled in the local economy. Chief Executive Ursula Lidbetter writes about the research . . .

Reading Co-operative News, I think we can all agree that co-ops are a good thing; a better way of doing business.

But in an age when all big companies pride themselves on corporate responsibility pledges, volunteering programmes and environmental actions, we co-ops have got to work a bit harder to prove that we really are different.

At Lincolnshire Co-operative, we’ve just taken part in some Co-operatives UK research to determine the economic impact a local co-operative society has on its community. Independent economic analysts K2A carried out the study and followed the cash spent with us. The method is called LM3 — LM for local multiplier, 3 because our customers’ money was traced as it was spent and re-spent three times. The results were striking.

It showed that for every £100 paid into our tills, an additional £40 is generated for local suppliers, customers and our employees. Money spent in our outlets goes through local people’s hands five to eight times.

We’ve got lots of examples of how we make this happen. First, we have our 215,000 members who all receive dividend on their purchases and a bonus at the end of the year. We pay them extra divi for buying fruit and veg, Fairtrade goods and local produce.

Only a small proportion of that dividend is cashed in through share accounts. Nearly all of it comes back through our food stores, travel branches, pharmacies, coffee shops, filling stations, funeral homes and our florist.

Then, we have our 2,700 hard-working local colleagues who ensure our services run smoothly. As well as their wages, we pay them a twice yearly bonus and extra staff points so they benefit from shopping with us too.

We use local suppliers to supply products to our stores through our Love Local range. We’re proud to stock a variety including meat, bread, cheese, crisps, fishcakes, coffee and tea, rapeseed oil, beer, jams and more unexpected items like cough sweets and curry pastes.

We know that our support has enabled those small businesses to grow. Jenny Smith, who makes Jenny’s Jams in Lincoln, has been able to move her business into an industrial unit since we started stocking her products. The Davenports, who run Cote Hill Cheese near Market Rasen, have been able to create more jobs.

We also use local firms for other services from legal advice to printing and recycling; through to the contractors we employ to build our stores. These aren’t picked purely because they’re local – they’re also the best for the job.

Through LM3, we asked all of our local suppliers how much they spent locally and the total came to about 75 per cent. By asking the question, we made them think about where they spend their cash.  One took local businesses and local authorities to Westminster to talk about buying locally. Interestingly, our County Council is now changing its buying policy to assist local organisations to bid.

We own property in the local area and use this to provide opportunities for businesses. Examples include investing in rural industrial units and leading the Lindongate scheme, a major plan to revamp part of Lincoln city centre. 

A big part of our role as a co-operative is to help support our members’ communities.

We’ve recently given over some space in our Waddington pharmacy to the village library, an innovative way of working with a local authority to keep community services running.

The grants and donations we make to good causes were also included in the LM3 mix, from the £20,000 we’ve given to our local credit union LincUp to enable it build membership, to £20 of vouchers to provide a hot meal for the homeless in Grimsby.

This year we’re going even further. We’re launching an exciting scheme called Community Champions, linking every one of our members to a cause doing good work where they live.

We’re pleased to have been a part of the LM3 research. It’s given us the data to back up our rhetoric and proved that Love Local is not just our slogan, it’s our philosophy.

• See below to read the full report.

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