Retailers examine the co-operative way of doing business

Representatives from co-operative retail businesses discussed the “co-operative way” of winning business at the annual National Retail Consumer Conference (NRCC) in Solihull. The event, which took place on...

Representatives from co-operative retail businesses discussed the “co-operative way” of winning business at the annual National Retail Consumer Conference (NRCC) in Solihull. The event, which took place on 21-23 February, gathered over 100 delegates from retail co-operatives in Solihull, where they discussed the future of retail co-operatives.

“What does it mean to serve customers in a co-op way? It means to listen, to engage and to be able have honest conversations,” Co-operatives UK Secretary General, Ed Mayo, said in his opening remarks.

Also speaking at the event, James Walton, chief economist at the Institute of Grocery Distribution, explored the consequences of the financial crisis on the retail industry. “Co-ops need to keep up and show that they can do things for shoppers that no one else can”, he said. “There is no room to be complacent”.

Tim Lang, who lectures on food policy at City University in London, encouraged co-operative retailers to get actively engaged in promoting healthy eating across Britain.

In his speech at the conference, Professor Lang said that retail co-operatives should play an active role in providing healthy food, by selling not only what people want, but also what they need. He suggested the Co-operative stopped selling tobacco, soft drinks or crisps as well as increasing biodiversity in the shop and introducing a soil policy.

Another guest speaker at the event, governance expert, Johnston Birchall, outlined some of his findings of his analysis of how the world’s largest co-operatives are governed.

He also highlighted a three-tier model of governance that he thinks could work. The three-tier model would include a members’ assembly, a supervisory board and a management board. Johnston Birchall’s full report will be published by Co-operatives UK later in 2014.

In a business focused session, two senior executives from large co-operative and mutual retailers outlined their respective strategies.

Neil Turton, the new chief executive of Nisa talked about the mutual nature of the buying group.

“We didn’t think of ourselves as a co-op” he said, “and only recently became involved in Co-operatives UK and the wider co-op movement.” He referred to “two take over bids that have been fought off over the last few years,” and there is a sense that Nisa’s involvement in the Co-operative Movement is intended to help it strengthen engagement and commitment amongst its independent member businesses in order to see off attempts at demutualisation.

Steve Murrells joined the Co-operative Group as Chief Executive of Retail 18 months ago, after a distinguished career in retail. He outlined the business’s True North strategy he is delivering.

Echoing Euan Surherland, he stressed that Group’s Food stores had not been offering customers the quality products, experience and value for money they expect.

The strategy aims to turn this around. By cutting the range of products stocked, developing better quality own brand products and creating ‘generation two’ stores, True North is a long term strategy to make The Co-operative Food the number one convenience stores in the UK.

Also taking part in the three-day conference, the newly appointed Secretary General of Euro Coop, Tudor Ivanov, highlighted the importance of innovation and exchange of best practices between European consumer co-operatives.

“The co-operative business model is the most sustainable”, he said. “But in order to be successful we need to talk to each other, be on the same page and speak the same language in terms of legislation”.

Lukáš Nemcik, project manager at the Union of Czech and Moravian Consumer Cooperatives (Group COOP) shared with the delegates the experience of retail co-operatives in the Czech Republic. The Group COOP includes 48 co-operatives, two buying groups, over 250,000 members and 16,000 employees.

“Our main philosophy is to be close to our customer”, explained Mr Nemcik, adding that the Group’s priority was providing high quality, local products. In their shops 60-80% of the products are produced locally, using local bakeries and farms as suppliers. The Group has also embarked on new ventures in energy and mobile networking, to provide customers cheaper services.

Getting to know the customer is also one of Scotmid Co-operative’s priorities. After having conducted a study into what customers wanted, Scotmid launched a new style of stores – the Premium Fresh stores.

“We wanted to make a real difference”, said John Dalley, chief financial officer of Scotmid. Speaking at the conference, Mr Dalley explained how customers shopping from the new Scotmid grocery stores can choose from a wider range of fresh products, most of them coming from local producers, including fresh bread and pastries, fruits, vegetables and cakes.

A worker co-operative based in Manchester, Unicorn Grocery is always keen on promoting local products. Kelly Bubble, worker-owner at Unicorn explained to NRCC delegates how Unicorn promotes a distinct way of doing business by supporting local food. Over 70% of fruits and vegetables sold at unicorn are from the UK, while products and their packaging produce minimum impact on the environment.

Mark Wilson, Group General Manager of Midcounties Co-operative spent 24 years working for Waitrose, the supermarket division of the John Lewis Partnership. In his presentation at the conference, Mr Wilson made the case for involving the workforce in the business.

“Five thousand heads are better than one”, he said, adding that following the 1993 recession John Lewis Partnership had to change its engagement strategy, by clarifying the rights and responsibilities of partners.


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