Cooperative Roots and Cooperative Roots and BranchesBranches

A Grass-Roots Seminar by

Steve Dubb and David Walker

For Interested Members of the

Takoma Park – Silver Spring Co-op

2011

What is a Co-op ?What is a Co-op ?

Every Cooperative and Every

Cooperator Has an Answer.Cooperative Roots and

BranchesCooperative Fundamentals

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Cooperative Roots and

BranchesCooperative Fundamentals

Takoma Park – Silver Spring Cooperative, Incorporated

is a cooperative and a for-profit Maryland corporation.

Cooperative Roots and

BranchesCooperative Fundamentals

A Corporation is a form of legal entity.

A Cooperative is a form of economic enterprise.

Cooperative Roots and

BranchesCooperative Fundamentals

Cooperatives exist for a purpose, not a profit.

Cooperatives serve economic functions that other competitors do not deliver.

Cooperatives exist because their users and owners need them to exist.

Self-Help: the Greatest Good for the Greatest Number

Cooperatives create jobs, pay taxes and provide goods and services to owners.

Cooperative Roots and

BranchesCooperative Fundamentals

Cooperatives are Open, Voluntary and Democratically-Controlled.Cooperatives are Open, Voluntary and Democratically-Controlled.

Cooperatives serve multiple stakeholders: Owners, Workers, Customers and Communities.

Communities

Customers

Owners Workers

Cooperative Roots and

BranchesCooperative Fundamentals

Cooperatives balance divergent or conflicting interests.Cooperatives balance divergent or conflicting interests.

Cooperatives Promote

Fair Business,

Fair Pricing

and

Fair Labor Practices.

Cooperative Roots and

BranchesCooperative Fundamentals

Consumer cooperatives operate at the retail levelto provide goods and services for end users.

TPSS Co-op is a consumer cooperative owned by its users.

Cooperative Roots and

BranchesCooperative Fundamentals

MISSION STATEMENTTakoma Park-Silver Spring Co-op promotes healthful living by offering wholesome food, high

quality products, and community resources in clean, friendly cooperative grocery stores –

that you can own.

VISIONWe are the peoples’ choice for food and community.

GUIDING PRINCIPLES

We believe in supporting individual and community health and well-being

We believe in operating all businesses for the benefit of the community, society and the planet

We believe in treating people fairly, equitably, and respectfully in all human relationships

We believe in people having a say in the issues affecting their lives

We believe in educating people about the issues that affect their lives

Cooperative Roots and

BranchesRochdale Pioneers

“Self-Help by the People”

Lancashire, 1844: A Pioneering Case StudyLancashire, 1844: A Pioneering Case Study

Cooperative Roots and

BranchesRochdale Pioneers

Textiles In Victorian England:A Global Industry in Revolution

Rapid Technological ChangeRising Productivity

Falling Prices for Goods Produced

Social TumultConflict and Confrontation

Economic Mobility Up and Down

Capitalism’s Creative DestructionBoom – Bust – Boom – Busted!

Cooperative Roots and

BranchesRochdale Pioneers

Community in TransitionRapid Growth in Rochdale

Rochdale Population Growth

0

10000

20000

30000

40000

50000

60000

70000

1801 1821 1841

Cooperative Roots and

BranchesRochdale Pioneers

The “Hungry Forties”

Truck ShopsWorkers paid in tokens redeemable only at company stores:

High prices, poor product choice, low-quality goods.

Labour StrifeTrade unionism flares and fizzles: “a complicated system of payments was agreed in Rochdale. Known as the Statement Price it was settled in 1824.

However, from that point on, wages entered a downward spiral that sparked-off a series of strikes and other labour actions.”

Falling wages“By the time the dreadful winter of 1841 hit, the Rochdale workers

were trying to cope on one-third of the average wage for working people. Strikes broke out again in August of 1842.”

Cooperative Roots and

BranchesRochdale Pioneers

Dissenters, Free Thinkers and New Philosophies

Robert Owen“Villages of Co-operation”

“Co-operative Commonwealth”

Dr. William KingPublisher of The Co-operator

“He saw a Co-operative store as central to a process that would provide the

working-class with an opportunity to help themselves.”

A National CharterUniversal (male) sufferage

Annual ParliamentsVote by (secret) ballot

Abolition of property qualifications for M. P.'sPayment of M. P.'s

Equal Electoral Districts

Cooperative Roots and

BranchesRochdale Pioneers

28 Cooperative Pioneers Capitalizing at £1 EachSome members were able to pay their capital in a lump sum.

Many others had to subscribe, paying twopence per share weekly.

15 August 1844The Rochdale Society of Equitable Pioneers is Established

Cooperative Roots and

BranchesRochdale Pioneers

Cooperative Roots and

BranchesRochdale Pioneers

21 December 1844: The Equitable Pioneers

Open Their Cooperative Store at 31 Toad Lane.

Cooperative Roots and

BranchesRochdale Pioneers

Initial Inventory Was Limited to

Flour, Oatmeal, Sugar, Butter and Tallow Candles.

Cooperative Roots and

BranchesRochdale Pioneers

The Rochdale PrinciplesThe present Co-operative Movement does not intend to meddle with the various religious or political differences which are now arising in society but by a common bond, namely that of self interest, to join together the means, the energies, and the talents of all for the common benefit of each. Hence, resolved:

(1) That capital should be of their own providing and bear a fixed rate of interest.

(2) That only the purest provisions procurable should be supplied to members.

(3) That full weight and measure should be given.

(4) That market prices should be charged and no credit given nor asked.

(5) That profits should be divided pro rata upon the amount of purchases made by each member.

(6) That the principle of ‘one member – one vote’ should obtain in governmentand the equality of the sexes in membership.

(7) That the management should be in the hands of officers and committee elected periodically.

(8) That a definite percentage of profits should be allocated to education.

(9) That frequent statements and balance sheets should be presented to members.

Cooperative Roots and

BranchesRochdale Pioneers

The Rochdale Pioneers knew they had to make a profit on store operations.

Their Laws and Principles defined how the profit would be used:

Profit and Surplus: “The Divi”

All operating expenses must be paid promptly, including workers and suppliers.

Principle 4That market prices should be charged and no credit given nor asked.

Cooperative Roots and

BranchesRochdale Pioneers

Members were paid a fair return on their invested capital.

All shares were paid the same fixed rate of return, but different members owned differing number of shares.

Principle 1That capital should be of their own providing

and bear a fixed rate of interest.

The Rochdale Pioneers knew they had to make a profit on store operations.

Their Laws and Principles defined how the profit would be used:

Profit and Surplus: “The Divi”

Cooperative Roots and

BranchesRochdale Pioneers

Adequate capital was reserved and retained to expand and develop their business.

Preamble by a common bond, namely that of self interest, to join together the means, the

energies, and the talents of all for the common benefit of each.

& Principle 1That capital should be of their own providing and bear a fixed rate of interest.

The Rochdale Pioneers knew they had to make a profit on store operations.

Their Laws and Principles defined how the profit would be used:

Profit and Surplus: “The Divi”

Cooperative Roots and

BranchesRochdale Pioneers

1% of the profit was devoted to education of the membership.

Principle 8That a definite percentage of profits should be allocated to education.

The Rochdale Pioneers knew they had to make a profit on store operations.

Their Laws and Principles defined how the profit would be used:

Profit and Surplus: “The Divi”

Cooperative Roots and

BranchesRochdale Pioneers

After attending to all such cooperative needs, any remaining profits were surplus.

Surplus profits were distributed to the membership in the form of a dividend: “The Divi”, paid in proportion

to each member’s purchases at the cooperative.

Principle 5That profits should be divided pro rata upon

the amount of purchases made by each member.

The Rochdale Pioneers knew they had to make a profit on store operations.

Their Laws and Principles defined how the profit would be used:

Profit and Surplus: “The Divi”

Cooperative Roots and

BranchesRochdale Pioneers

The Rochdale Pioneers were successful. Their business grew, expanded and diversified.

With other UK cooperatives, the Pioneers created the Cooperative Wholesale Society (CWS) to produce and distribute reasonably-priced consumer goods and staples.

The Rochdale Cooperative opened other stores, warehouses and factories.

Cooperative Roots and

BranchesRochdale Pioneers

Building on Success: UK Cooperatives TodayBuilding on Success: UK Cooperatives TodayThe Rochdale Pioneers and the Cooperative Wholesale Society merged

with other co-ops to form The Cooperative Group, a vast network of consumer and producer cooperatives in the United Kingdom.

The UK Cooperative Group is the world’s largest consumer-owned business with

4.5 million members and 123,000 employees.

The original store at 31 Toad Lane in Rochdale is now the Rochdale Pioneers Museum

Cooperative Roots and

BranchesStatement on the Co-operative Identity

DefinitionA Cooperative is an autonomous association of persons

united voluntarily to meet their common economic, social, and cultural needs and aspirations through a

jointly owned and democratically-controlled enterprise.

International Co-operative AllianceInternational Co-operative Alliance

Statement on the Co-operative Identity

ValuesCooperatives are based on the values of self-help, self-

responsibility, democracy, equality, equity, and solidarity. In the tradition of their founders, Cooperative members believe in the ethical values of honesty, openness, social

responsibility, and caring for others.

PrinciplesThe Cooperative Principles are guidelines by which

Cooperatives put their values into practice.

Cooperative Roots and

BranchesStatement on the Co-operative Identity

1st Principle: Voluntary & Open Membership

International Co-operative AllianceInternational Co-operative Alliance

Co-operative Principles, 1995

Cooperatives are voluntary organizations, open to all persons able to use their services and willing to accept the responsibilities of members, without gender, social, racial, political, or religious discrimination.

Cooperative Roots and

BranchesStatement on the Co-operative Identity

2nd Principle: Democratic Member Control

International Co-operative AllianceInternational Co-operative Alliance

Co-operative Principles, 1995

Cooperatives are democratic organizations controlled by their members, who actively participate in setting their policies and making decisions. Men and women servicing as elected representatives are accountable to the membership. In primary Cooperatives members have equal voting rights (one member, one vote), and Cooperatives on other levels are also organized in a democratic manner.

Cooperative Roots and

BranchesStatement on the Co-operative Identity

3rd Principle: Member Economic Participation

International Co-operative AllianceInternational Co-operative Alliance

Co-operative Principles, 1995

Members contribute equitably to, and democratically control, the capital of their Cooperative. At least part of that capital is usually the common property of the Cooperative. Members usually receive limited compensa-tion, if any, on capital subscribed as a condition of membership. Members may allocate surpluses for any of the following purposes: developing their Cooperative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the cooperative; and supporting other activities approved by the membership.

Cooperative Roots and

BranchesStatement on the Co-operative Identity

4th Principle: Autonomy & Independence

International Co-operative AllianceInternational Co-operative Alliance

Co-operative Principles, 1995

Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their Cooperative autonomy.

Cooperative Roots and

BranchesStatement on the Co-operative Identity

5th Principle: Education, Training & Information

International Co-operative AllianceInternational Co-operative Alliance

Co-operative Principles, 1995

Cooperatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their Cooperatives. They inform the general public – particularly young people and opinion leaders – about the nature and benefits of cooperation.

Cooperative Roots and

BranchesStatement on the Co-operative Identity

6th Principle: Cooperation among Cooperatives

International Co-operative AllianceInternational Co-operative Alliance

Co-operative Principles, 1995

Cooperatives service their members most effectively and strengthen the Cooperative movement by working together through local, national, and international structures.

Cooperative Roots and

BranchesStatement on the Co-operative Identity

7th Principle: Concern for Community

International Co-operative AllianceInternational Co-operative Alliance

Co-operative Principles, 1995

Cooperatives work for the sustainable development of their communities through policies approved by their members.

Cooperative Roots and

BranchesThe Scope of Cooperation

30,000 American Cooperatives30,000 American Cooperatives73,000 Places of Business

Assets$ 3 Trillion

Revenues$ 654 Billion

Economic Impact Economic Impact of U.S. Co-ops:of U.S. Co-ops:

Wages & Benefits$ 75 Billion

2 Million Jobs

Cooperative Roots and

BranchesThe Scope of Cooperation

Co-ops In the Twenty-First CenturyCo-ops In the Twenty-First CenturyOperating Locally, Co-operating Globally

Types of Co-opsTypes of Co-ops

Worker Co-ops

Purchasing Co-ops

Co-op types vary by ownership.

Consumer Co-ops

Producer Co-ops

Cooperative Roots and

BranchesThe Scope of Cooperation

Agriculture & Fisheries

Health

Banking & Credit

Housing

Industry

Retail & Wholesale

Insurance

Services

Travel

Utilities

Co-ops In the Twenty-First CenturyCo-ops In the Twenty-First CenturyOperating Locally, Co-operating Globally

Economic Sectors of Co-opsEconomic Sectors of Co-opsCo-op sectors vary by markets served.

Cooperative Roots and

BranchesThe Co-op Difference

The Co-op DifferenceThe Co-op Difference

Maximize profit to shareholders. Fair return to member-owners.

Comparing Capitalism and Cooperation

Must grow to expand market share. Key criterion is service to members.

Competition/Aggression. Cooperation among Cooperatives.

Amorality.Solidarity. Key principle is constant

education of membership.

Hierarchy. Democracy.

Quantitative decisions. Qualitative decisions.

Corporate Value Cooperative Value

Cooperative Roots and

BranchesThe Co-op Difference

Corporate Value Cooperative Value

Depersonalized.Respect for autonomy is

a core principle.

Corporation can exist anywhere. Co-op is a local creation.

Not tied to specific place, a corporation can move anywhere.

Concern for community is a core co-op principle.

Nature is a factor of production.Concern for ecology is a common

focus of Cooperatives.

Homogenization Heterogeneity/ Diversity.

Workers paid less than value of labor. Fairness is core value.

The Co-op DifferenceThe Co-op DifferenceComparing Capitalism and Cooperation

Cooperative Roots and

BranchesCooperative Involvement

Join a Co-op committee. Help govern and guide the Co-op into the future.Now active: Membership Committee, Finance Committee, and Expansion Task Force

Deepen Your Involvement in TPSS Co-opDeepen Your Involvement in TPSS Co-op

Volunteer at public events. Make the Co-op visible in the community at Earth Day (April), Jazz Fest (June), 4th of July parade, or the Takoma Festival (Oct).

Participate in community events at the stores.Support Story Time, membership meetings or member education.

Take part in Advisory Groups and Partake in Food Tastings!

Write for the Co-op. Be a contributor to the newsletter or website. Photography is also a very helpful skill!

Do research for the Co-op. Help the Co-op gather information, conduct surveys and learn the best practices of other co-ops, so we can become even better!

Help with Outreach. Be a representative of the Co-op in the community.

What is a Co-op ?What is a Co-op ?

What Do You Think Now?What Do You Think Now?

Cooperative Roots and BranchesCooperative Fundamentals

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Cooperative Roots and Cooperative Roots and BranchesBranches

Thank You For Attending.Thank You For Attending.

Get Involved – Be Get Involved – Be

Cooperative!Cooperative!