Challenges for consumer co-ops: Rethinking economic value and communication

Campaigns on fairness, climate change and broken markets are ‘call back to co-operation’s radical roots’, says Jeevan Jones

Jeevan Jones is an economist and elected Vice President for Business Performance and Strategy of the Co-operative Group’s National Members’ Council (writing in a personal capacity).

As we make our way through this year’s consumer co-operative conference season, it’s timely to reflect on our purpose and relevance.

Two key events in the UK’s co-op calendar around this time are the UK Society for Co-operative Studies conference (24-25 Feb in Lincoln) and Co-operatives UK’s Co-operative Retail Conference (24-26 March, Cheshire), which both bring together theorists and practitioners to consider what consumer co-operation means today.

In Lincoln, I spoke about the need to change how we think about creating and sharing economic value with members in modern times. This is particularly necessary as consumers struggle in a cost-of-living crisis and retailers face acute supply challenges.

Related: Report from the UKSCS Conference

Traditionally, co-operators focus on distributing financial surpluses to their members. Linking the share of this surplus to each member’s spend should drive loyalty and ultimately a commercial and co-operative advantage. But in times that are more prudent than prosperous, it helps to rethink. We can use a new framework that categorises member economic value into five broad categories – price, products, proximity, principles and proceeds.

Of the ‘five Ps’, proceeds can be seen as ‘below the line’ – the money left from sales after all other costs. But the other Ps, while they have associated costs, can also be seen as creating and sharing value for members. Lower prices may reduce income from sales, but they can benefit members and they may spend more. Similarly, a more diverse range of products could be what members want. Proximity could mean that a co-op chooses to operate in communities where no other retailer would, providing benefits to local members. Principles underpin the ethical choices that a co-op makes – whether that’s Fairtrade, packaging or campaigns. 

All of these are choices, and all of them are ways of returning value to members – the ultimate purpose of consumer co-ops. But how do they decide which choices to make and that they are fair? How do they balance the interests of the most motivated with the majority of members?

This is particularly challenging for larger co-ops. Look at any democracy to see how challenging it is to understand what people want and balance competing interests. Co-ops could use more deliberative systems, often with elected members’ councils to make these decisions, but they risk being unrepresentative or disconnected from the wider membership. Direct democracy is another option, but narrow majorities can dominate. Digital technology opens up opportunities for more distributed decision-making, letting individual members take responsibility and decide for themselves – with mobile apps we could bring co-operation into every living room and workplace.

This brings me to the Co-operative Retail conference in Cheshire. Co-ops will only be successful if they remain relevant to current and future generations. As the youngest-ever vice-president of the Co-op Group’s Members’ Council, I’ll be joining the debate. Our movement has a huge opportunity to harness its heritage, values and principles – but it must align with what young people care about.

Our ethical choices and campaigns should focus on treating people fairly, tackling climate change and reforming broken markets – a call back to co-operation’s radical roots. But it will all be for nothing if young people don’t understand what we’re trying to say. Our movement can’t afford to keep speaking to itself in its own language. As well as rethinking how we can be relevant, we must also challenge ourselves to more effectively communicate our co-operative difference. We can start by making it easier for the next generation to join in with these important debates.