The Massive Movement that Grew from Rochdale's Tiny Store

****The Massive Movement that Grew from Rochdale's Tiny Store

"This is very special to us - this hallowed ground."  With these words a
visitor from the United States summed up the reason why hundreds of
international visitors last year made a pilgrimage to the little store at
31 Toad Lane, Rochdale, for the 150th anniversary celebrations - and why
many more are expected this year during the ICA's centennial.

When the Rochdale Equitable Pioneers Society opened their shop in December
1844, with the aim of selling pure and unadulterated food at fair prices
and with honest weights and measures, they pointed the way for like-minded
men and women to set up similar co-operative societies.  And so it was that
the consumer Co-operative Movement effectively became established - not
just in Britain but throughout the world.

Certainly it is never claimed that the Rochdale Pioneers were the first.
Co-operatives, so historians tell us, were a familiar concept to the
farmers of ancient Babylon; and there is plenty of tangible evidence of
many co-operative experiments in England a generation and more before the
Pioneers set up shop.  One even became established in Rochdale during the
1830s, but like many others at that time it failed because of financial
mismanagement.

Throughout last year's 150th anniversary celebrations a steady stream of
international visitors to the Rochdale Pioneers Museum and the Co-operation
150th Exhibition, located nearby in Rochdale town centre, were able to see
clearly how the Co-operative Movement expanded in Britain after 1844.  From
the "hallowed ground"of Toad Lane the growth was truly phenomenal.  It was
as if a great dam had burst in Rochdale on that December night, providing
the precious water to irrigate a desert of poverty and deprivation,
disenfranchisement and prejudice, and allow green shoots of co-operation to
flourish in the most barren soil of post- Industrial Revolution Britain.

As Johnston Birchall points out in new history of the Movement (Co-op: The
People's Business, Manchester University Press, 1994) one reason for the
rapid expansion was that in retailing at that time, there was very little
competition for co-operatives apart from small, independently owned and
usually badly run shops.  But another, more fundamental reason was that the
Movement was blessed with exceptional leaders whose social goals spurred
them on to develop the best methods of doing business, not for private gain
but for the benefit of their members.  Indeed, as Birchall points out, the
Rochdale Pioneers had no sooner formed their own co-op than they were
advising others.  As a result, half a doyen societies operating similar
"Rochdale Principles" had become established within three years.

The Rochdale style of consumer co-operative became the norm, and the model
for others to follow, quite simply because it demonstrated for all to see
that it worked so effectively.  For the Rochdale Pioneers Society itself,
trade and membership grew falteringly at first, but the success of the
venture quickly gained an unstoppable momentum.  By 1880, the original
membership of 28 Pioneers had multiplied 379 times; turnover in the same
period increased more than 400-fold.  At the same date, national membership
of consumer societies had reached over half a million people - a figure
that was to triple to 1,700,000 by the turn of the century.

A major spur to this remarkable growth was the establishment in 1863 in
England and Wales of the Co-operative Wholesale Society, and a Scottish
equivalent four years later.  For the CWS, supported in its early years by
a strong band of activists from the Rochdale Society, business began
modestly enough in a few rented rooms in Manchester, but it soon developed
into a major food importer, establishing supply chains for Irish butter,
Danish bacon, Indian tea and American wheat at prices working people could
afford.  Within a relatively short while the CWD opened depots on five
continents to buy directly from the growers; it built its own fleet of
ships; and it established its own factories to produce and sell on to
societies the vast range of basic products which a more prosperous working
class was demanding.  The CWS was, in short, rapidly growing into Britain's
biggest business, and a multi-national conglomerate at that, which brought
to its member-societies and to co-operators themselves all the advantages
of vertical integration - though its creators would never have used
business jargon such as that to describe their achievements!

While the CWS expanded into other businesses such as banking and insurance,
retail societies diversified beyond food retailing into elaborate
department stores, coal distribution, productive units for dairy and bakery
output, members' death benefits and funerals.  It was societies' proud
boast that they were able to give members a comprehensive service from the
cradle to the grave, and by offering the traditional cash dividend on
purchases, which Rochdale had pioneered, their position on the high street
seemed invincible.

It was not only societies' retailing strength that was blossoming, however.
With members playing an active part in running "their" businesses,
co-operative guilds giving working-class women a first taste of
empowerment, and educational programmes broadening horizons beyond the
drudgery of everyday life, the Co-operative Movement was becoming deeply
enmeshed in the social fabric of the time.

By the early part of this century, consolidation in the number of separate
societies began; a process which has reduced the total from 1,464 in 1900
to around 50 today.  The growth in the size and strength of the Movement
meanwhile continued unabated through two world wars and during a subsequent
shopping revolution which saw retail food outlets transformed first into
self-service supermarkets and later into out-of-town superstores.

By the 1950s, however, it became clear that co-operative retailing (or
simply the Co-op, as it had become affectionately known) could not continue
unopposed forever.  Capitalist chains began to rally their forces and
seized a post-war boom in consumer spending as opportunity for rapid growth
at the expense of co-operative societies.  Some of these were regarded, not
always unfairly, as fat and complacent while others were too small to meet
serious competition.  As a result, the British consumer Co-operative
Movement stopped growing for the first time in more than a century.

Urgent reforms were recommended, and strategies developed to meet
competition in a rapidly changing retail environment, but - inevitably
perhaps in a voluntary and democratic Movement - changes were implemented
painfully slowly, while many of the strategies proved inadequate to meet
the relentless tide of private chains which first swept through the high
streets and then moved to edge-of-town "retail sheds" on green field sites.
The Co-op meanwhile grappled with an outdated shop structure,
decentralised decision-making and an arcane management structure.

As Johnston Birchall remarks in his new book, the key message of the last
few decades is that the Co-op has weathered the storm.  "As an example of
organisational survival in a turbulent environment, it is probably without
parallel; private firms faced with a tenth of the Movement's problems would
long ago have gone out of business."

Only ten years ago, as the consumer Movement almost bled to death under the
collective burden of loss-making societies, most City analysts predicted
that the Co-op would have disappeared from the British retail scene by the
1990s.  Today, there is some pleasure in proving those analysts wrong.
Market share has been held at around four per cent, profitability has been
restored to reasonable levels, and there is now the likelihood of further
society mergers from positions of relative strength.  This last point holds
out the tantalising prospect of a leaner, sleeker, greener and more
member-oriented Co-op which can find a distinctive niche in the consumer
markets of the next century.