How a retail co-op weathered world trade

Andrew Bibby reviews a history of the global trading efforts of the CWS

Co-operation and Globalisation: The British Co-operative Wholesales, The Co-operative Group and the World Since 1863 (Anthony Webster, Routledge £36.99)

The empty supermarket shelves and queues at filling stations in recent weeks have drawn attention to an aspect of modern business life that normally operates quietly out of sight. Supply chain management (SCM) spans the whole world economy and somehow generally ensures that everything from, say, Peruvian asparagus to Greek olives to adequate supplies of toilet paper are ready and waiting for us to buy when we head off to do our shopping.

For ‘somehow’ in that last sentence, read instead highly sophisticated computer technologies, the optimisation of inventory control, Just in Time ordering, and tight control by retailers of their whole supply chains. Conventional business texts suggest that this is all relatively new. Before the last 30 years, so the story goes, it was the manufacturers, agents and shippers who oversaw supply chains in an ad-hoc and disorderly fashion. Only more recently have retailers grabbed the power. Only more recently has SCM matured as a business discipline.

Except, as Anthony Webster points out, the co-operative movement was doing a great deal of sophisticated SCM more than a century and a half ago. “Controlling supply chains was ‘hard-wired’ into the movement from its earliest days,” he writes in Co-operation and Globalisation. “The capability to manage its supplies in a coherent way was prioritised in the developing structure of the consumer movement from a very early stage in its development.”

The co-op societies of Yorkshire and Lancashire (and particularly the Rochdale Pioneers’ leadership) were responsible in 1863 for the establishment of what quickly became the Co-operative Wholesale Society (CWS, or just the ‘Wholesale’). Webster reminds us that it was only twelve years later that a CWS procurement office was opened in New York. Other CWS offices around the world followed quickly. Copenhagen (since the CWS was a major importer of both Danish bacon and Scandinavian butter) followed in 1881, and then came Hamburg, Aarhus, Montreal, Gothenburg, Denia (Spain) and Sydney. The CWS purchased its first ship in 1874 and for some years ran its own shipping line. By 1889, only twenty-six years after its modest beginnings, the CWS was turning over £23 million.

It was, as Webster convincingly demonstrates, a ‘meteoric’ rise. The CWS was effectively a multinational business long before the term entered common parlance. Long before Tesco, Sainsbury’s, Asda and the others entered the picture, the co-operative movement had considerable experience of the business successes (and sometimes the failures) that could entail when you operated across the globe. And yet who really knows this story? I’m inclined to suggest that conventional business schools – not normally known for their understanding of the co-op business model – should make sure Webster’s book features on all their SCM reading lists for students.

This is the second time that Anthony Webster, who is a professor in history at Northumbria University, has tackled the CWS history, having been a co-author (along with John Wilson and Ruth Vorberg-Rugh) of the more conventional business history Building Co-operation. That book, written to celebrate 150 years of the CWS/Co-op Group, suffered the appalling bad luck of appearing in 2013 just as the Group went into meltdown, the time when the Co-op Bank was lost. 

This time, arguably, Webster’s book has suffered only from the misfortune of coming out just before Covid-19 hit. (Our review is overdue partly because publishers Routledge have taken their time to get a review copy to us).

Webster’s second book focuses specifically on the international element of the CWS story, somewhat underplayed in building co-operation. To be more accurate, Webster’s reach this time extends also to the Scottish CWS, for much of its life an independent co-op society (albeit one which collaborated closely with the English Wholesale) – although it has to be said that the CWS gets the lion’s share of the author’s attention. Webster points out that the two Wholesales developed full vertical integration of their businesses partly as a mechanism to overcome private sector hostility to the concept of co-operation. If you couldn’t rely on the private market to treat you fairly, the answer was perhaps to sidestep the conventional channels. The result was that CWS tea was grown on its own tea plantations in Ceylon and India, palm oil was sourced directly in West Africa and pigs were slaughtered for bacon in its own abattoirs in Denmark.  

There is, or has been, a view that the two Wholesales, business successes though they were, got there by focusing on hard commercial realities and forgetting their co-operative principles. Certainly, the CWS came in for stick in the later nineteenth century from co-operative leaders such as Holyoake and Vansittart Neale for the way they ran their factories on conventional lines. However, Webster points out just how disloyal many distributive co-operative societies could be to the Wholesales, in terms of filling their stores with goods sourced not from within the movement but from competing private sector suppliers. Sometimes co-operative solidarity could run thin.

The tension between commercial demands and co-operative principles resurfaces in the twentieth century. Webster recounts how the CWS (and in particular the CWS-owned Bank) helped develop co-operative wholesaling in other countries (his brief mentions of its links with the Palestine CWS are fascinating, for example). 

It offered support for the Spanish Republican government after Franco’s coup. But on the other hand, it resisted pressure to cease trading pre-1939 with Nazi Germany. 

Today, the way that the CWS/SCWS managed its operations in British colonial countries such as India and Ceylon (Sri Lanka) is of considerable interest, but hard information is obviously lacking for the historian. Webster finds some evidence that the CWS did try to provide better housing and health care for its Indian workers (although, Granada TV in 1973 ran a controversial – and possibly slightly over-egged – expose of conditions in the co-op-owned Mahavilla estate in Ceylon). Only in very recent times has the co-op movement, with its strong commitment to Fairtrade, tried to put ethical issues at the heart of its operations.

Two final thoughts. Firstly, Anthony Webster’s book is possible to a large extent because CWS minute books have been kept safe in the National Co-operative Archive in Manchester; keeping our archives is essential if we are to know our own history. Secondly, the high price of academic books will, unfortunately, put Co-operation and Globalisation out of many people’s reach. The answer here is perhaps for academics writing on co-operative subjects to press their publishers to provide free Open Access PDFs:  Matthew Thompson has done just this with his new book on Liverpool’s co-operative housing history, Reconstructing Public Housing, and the idea is one which really needs taking up.