Year of challenge for co-operatives
MANCHESTER’S Co-operative Group has lost its status as the country’s biggest worker-owned business by annual sales.
The mutual, which in the last year has to sell off some assets such as its pharmacies and farming business to strengthen its balance sheet, has been overtaken by department store retailer John Lewis, research from trade body Co-operatives UK said.
John Lewis’ sales in the year to March were £10.9bn some £100m more than the Co-operative, which still has a far wider membership at 8.4 million than JLP, which has 93,800 members.
The report revealed that the whole of the worker-owned business sector saw its sales fall 2.8% this year to £37bn, largely as a result of the crisis at the Co-op.
However, it said the co-operative sector remained resilient despite the bad publicity, with the number of members in the movement rising by 1.3% to 14.9 million this year. The survey added that the number of independent co-operatives also edged up 0.5% to 6,796 businesses.
The largest area in the sector is retailing, which this year accounted for annual sales of £14.9bn – or 40% of all employee-owned businesses. The next biggest area for worker-run businesses is farming. Energy and health and social care are also areas witnessing growth.
Ed Mayo, secretary-general of Co-operatives said: “The Co-operative Group is coming out of a challenging period into one of renewal, and this of course has had an impact on the sector.
“Yet innovation and growth amongst co-operatives large and small, in everything from solar power to social care, have meant that the co-operative sector is growing and in good health.”
The biggest area of growth is in energy, an increase powered by the combination of a flourishing renewable energy co-operative sector and the start-up of Co-operative Energy in 2010, which now supplies 213,000 customers. In 2010 energy co-ops generated £18m, a figure that has rocketed to £260m.
