Coops: can they compete with big business?

I’ll be contributing a series of articles for the Guardian over coming weeks around the theme ‘can cooperatives compete?’.  The first of the series has just appeared on their website (here).

I deliberately pose a couple of provocative questions at the start of the first piece: “If cooperatives are such a good idea, why isn’t the world full of cooperatively run businesses? Why are the commanding heights of the global economy predominantly in the hands of investor-owned companies – and not run by coops operating for the benefit of their members?”

Are there structural reasons why coops can’t hack it? Are there perhaps legal, or financial, or organisational reasons which may be holding coops back?  Or is it (as you’ll see Chuck Gould of the ICA is suggesting) that coops are actually playing a different game from plcs – and that direct comparison is therefore both invidious and irrelevant?

You’ll have to wait for the remaining five pieces in the series to appear (they’ll be put up by the Guardian on a weekly basis).  But you’re welcome to respond straightaway, either here or on the Guardian’s website.

Good news: cooperatives doing well

Two good news cooperative stories in one day.


The first reaches me indirectly via Le Monde, which ran a major feature in its paper yesterday on the success of the green electricity distribution coop EWS, based in the south German village of Schönau.  EWS, set up by a local teacher Ursula Sladek who had lived through the aftermath of the Chernobyl disaster, took over the electricity distribution network for the community of Schönau itself in 1997 and now has grown to have customers throughout Germany.  Its electricity is 100% renewable and comes from a variety of sources, including wind turbine and hydro generation… but definitely not nuclear. Turnover (2012) was 140 million euros, profits over 4 million euros, and the coop’s members earn a 4% return on their money. The Le Monde article is currently available online here. 

Here, just to brighten up my blog, is a picture of their Board, lifted from the EWS website. (I’m not entirely sure what they’re holding.)


And closer to home an email brings news from the Phone Coop, which has just announced record profits for last year, at a little over half a million pounds.  Dividends on customer purchases are in line to go up from 2% to 2.5%, and I understand that the Phone Coop is also planning to increase the contribution it makes to the development of other cooperatives through its Co-operative and Social Economy Development Fund. The Phone Coop also demonstrates the possibility of utilising capital from members, having now around £4m in members’ capital invested in the business.

What will 2014 bring for coops?

The Guardian’s social enterprise site is carrying on the usual tradition of newspapers at this time of year in running pieces looking back on the year just ending and forward to the year ahead.  Among contributors offering their reflections on the way forward for coops in 2014 are Ed Mayo, head of Co-operatives UK, Peter Holbrook who leads Social Enterprise UK, and Vivian Woodell, Chief Executive of the Phone Coop. I was also asked to contribute my thoughts for this feature.  If you want to read what we’re all saying, you’ll find the piece here.  There is also of course the facility for you to leave your own comments.