New
PIONEERS ANNUAL REVIEW 2011
New Pioneers
Contents 2 3 4 5 6 10 14 18 20 22 24
Chair’s Introduction A Co-operative Renaissance About the Hub Performance How We Help: Starting Out How We Help: Choosing Co-operation How We Help: Achieving Sustainability How We Help: Accessing Finance How We Help: Supporting Co-operatives Overseas How We Help: Renewable Energy Co-operatives Looking Ahead
Front cover: Maracuja is a new community co-operative with plans to open an Anglo-African cultural centre in Rochdale, the birthplace of co‑operation (page 6). Inside front cover: Elbow Grease, in Essex, is a co-operative of adults with learning disabilities who provide helpful services including shopping, dog walking and gardening for people in need. Inside back cover: Flowers from the Farm, a new marketing co‑operative for flower growers (page 8).
The copyright of all photographs belongs to either The Co‑operative Group or the individual co-operative pictured, except where specified. Design and production: www.alpha.coop
Be inspired It gives me great pleasure to introduce this – the second New Pioneers report. I defy you to read this report and not be inspired by the fabulous accounts of people coming together to run businesses that make a real difference to society. Since 2009, The Co‑operative Enterprise Hub has provided advice and training to assist 521 enterprises to set up as new co-operatives, with a further 165 established co-operatives receiving support to help them at critical points in their development. In early 2011, The Co-operative launched an Ethical Plan that sets out its sustainability priorities for the next three years. Among the eight areas of focus is ‘supporting co‑operatives’, and it is clear that the activities of The Co‑operative Enterprise Hub are absolutely key in delivering against objectives in this area.
In achieving nationwide coverage for the first time in early 2011, The Co-operative Enterprise Hub began to offer something unique in the area of co‑operative business development – a national programme of free, tailored business support. That such a service is dedicated exclusively to co-operative business development is so satisfying to a long-standing co‑operator like me. The Co-operative Enterprise Hub is playing a significant role in equipping the new generation of co-operators with the tools to create the next generation of sustainable co-operatives and, ultimately, deliver a stronger co‑operative economy in the UK.
“ I defy you to read this report and not be inspired by the fabulous accounts of people coming together to run businesses that make a real difference to society. ”
November 2011
In the three year period from 2011-2013, The Co-operative has committed to investing £11m to support the growth and development of co-operatives – some £7.5m of which will be channelled through the Hub. This is The Co-operative at its best – using its economic weight and the strength of its business model to live out the guiding principle of ‘co-operation among co-operatives’. The United Nations has declared 2012 the International Year of Co‑operatives – a designation that promises to build on the resurgence of interest in the co-operative way of doing things and fix a global spotlight on the better way we go about business. The time is ripe for co-operative development, and it is fantastic that the Hub is here to harness this momentum and deliver real value to today’s new pioneers.
David Evans, Chair of The Co-operative Enterprise Hub
New Pioneers
A Co-operative Renaissance It has taken nothing short of an international financial crisis for public debate to bring into question the orthodoxy that ‘the role of business is business’ – that the relentless pursuit of profit is, and should be, the only activity for which business has responsibility.
The Co-operative Enterprise Hub is well positioned to support the co-operative renaissance; to help fledgling and expanding co-operatives at the time they need it most with advice and training that encourages their long term sustainability. The services the Hub offers are arguably needed now more than ever before, as a host of externalities come together to present unprecedented opportunities for co-operative development. With this increased demand has come an increased need to ensure that the advice and training delivered through the Hub is of a consistently high quality. That is why the Hub is supporting the development of the first set of standards and guidelines for co-operative advisers in the UK.
UK CO-OPERATIVE ECONOMY
Billion (£)
Turnover Turnover
Billio Billio n n
Such is the resurgence of interest in the co-operative model, that the image of co-operatives as dowdy, outmoded and unsavvy operations is gradually being eroded. A new generation of pioneers is establishing co-operative businesses the length and breadth of the UK, and their diversity challenges previously held notions of co-operators and co-operatives. Traditional areas of co-operation, such as retail and farming, continue to grow, but the co-operative economy is being bolstered by new entrants engaged in a host of exciting sectors – from holiday parks to delicatessens, art galleries and green energy producers. In 2010, the co-operative economy in the UK grew some 4.4% to turnover £33.2bn. Contrast this with growth for the UK economy as a whole of 1.3% and it becomes easier to understand why co-operation is no longer being regarded as a business backwater.
The breadth and depth of the Hub’s activities is set only to expand, as it responds to new developments in the growing sector. In 2011, The Co‑operative set out ambitious commitments to the co‑operative sector in its Ethical Plan. The Co-operative has committed to significant investment, and the Hub will seek to ensure that this continues to be maximised for the advancement, strengthening and sustainability of the co-operative revolution.
34 34 33 33 32 32 31 31 30 30 29 29 28 28 27 27 26 26
Turnover
2008 2008
2009 2009
2010 2010
N u m b e r o f c o -o p e ra tiv e s
N u m bof e r oco-operatives f c o -o p e ra tiv e s Number
Thousand Thousand
Step forward then, co-operation – a robust, inclusive and socially responsible approach to business that has remained rooted in principle for over 150 years and has stood resolute in the face of economic vagaries. It is possible that out of the economic doldrums may emerge an economy that benefits from a much richer diversity of enterprise. The prevailing economic and public policy climate in the UK is one that is encouraging co-operative development; whether it be communities coming together to save the assets and services they hold dear, employees choosing to buy enterprises from their employers; or groups of friends coming together to take forward bold, innovative and socially responsible business ideas.
5500 5500 5400 5400 5300 5300 5200 5200 5100 5100 5000 5000 4900 4900 4800 4800 4700 4700 4600 4600 4500 4500
2008 2008
2009 2009
2010 2010
Source: Co-operatives UK (2011), The UK Co-operative Economy Membership Membership
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About the Hub The Co-operative Enterprise Hub offers free advice, training and access to finance to new and existing co-operatives, to help them set up, grow and prosper. Support is delivered through a network of co-operative development advisers and is available to new and established co-operatives – whether they’re starting out, wanting to expand or needing to change their management structure, the Hub is here to help. Additionally, the Hub is investing in specific areas of activity within the co-operative economy, which complement the wider objectives of The Co-operative.
These include: • A dedicated fund of £1m over three years to support community-owned renewable energy schemes (page 22) • The provision of a lower cost green energy purchasing scheme • A partnership with The Co‑operative Loan Fund to support community share issues • A programme of activity to support young co-operative enterprise. An emergent programme of activity is seeing the Hub’s remit also extend to the promotion of co-operative development in the developing world (page 20).
Our aim The Co-operative Enterprise Hub aims to support the next generation of co‑operators to build sustainable, co-operative enterprises and deliver a stronger co-operative economy in the UK.
Our objectives • We will promote co-operation as the best way of doing business, with a view to advancing, strengthening and increasing the sustainability of the UK co-operative economy. • We will invest £7.5m over three years to inspire and stimulate the creation of new co-operatives, nurture the development of nascent co-operatives and support the growth of existing co-operatives. • We will seek to ensure that the advice and training delivered through the Hub is professional and of a high and consistent quality by developing and promoting new standards and guidelines for co-operative development advice in the UK.
November 2011
• We will explore and develop channels through which we can promote co-operation between co-operatives assisted by the Hub. • We will ensure that the work of the Hub contributes effectively to The Co-operative’s Ethical Plan objectives in the areas of supporting co-operatives, inspiring young people, protecting the environment and tackling global poverty.
New Pioneers
Performance Research undertaken in 2011 reveals high levels of satisfaction with the service provided and shows how the Hub is performing against its objective of advancing, strengthening and increasing the sustainability of the UK co-operative economy. ADVICE AND TRAINING
CO-OPERATIVE GROWTH AND SUSTAINABILITY
SATISFACTION, SKILLS AND COMMITMENT
TOP 5 SECTORS FOR HUB ADVICE AND TRAINING
Starting out
Giving new co-operatives the help they need November 2011
New Pioneers The passion of a new generation of Rochdale pioneers has come together in Maracuja, meaning ‘passion fruit’. Maracuja established itself as a community co‑operative and began trading in January 2011, with ambitious plans to open Rochdale’s first AngloAfrican Cultural Centre, offering an ethnic cafe, exhibition space and entertainment. It has signed a five-year lease on a property that needs refurbishment and is looking to raise funds for the work through a community share issue.
The story of MARACUJA
So far, 50 members have invested, but they still need to recruit more members if their dream is to fly. The community co-operative was established with the objective of raising awareness and appreciation of Afro-Caribbean culture. It has formed an African artists’ forum to help artists promote their work by offering them exhibition space on their website and in their future cultural centre.
How we helped
Support is also provided to disadvantaged people from Afro-Caribbean backgrounds. The co-operative aims to help them gain confidence to go further in employment or higher education, by providing skills for employment and creating volunteering and job opportunities.
• We also helped Maracuja to launch a community share issue, to generate sufficient funds to refurbish their premises.
“ The Hub gave us some good consultancy, which contributed greatly to making our vision become real. What we’re doing today, and how far we’ve come, is mostly due to its support. ” Peggy Mulongo
• We helped Maracuja to incorporate itself as a community co‑operative, providing the necessary legal and governance advice. • We developed a business plan and undertook a cash flow forecast, designed to ensure Maracuja had a sustainable future.
Jo Bird, the Hub adviser, said: “Maracuja’s vision was developed in a co-operative spirit; to have a community business, owned by the local people, for everyone’s benefit.”
Maracuja also provides consultancy on a broad range of African issues. This encompasses everything from expert advice on culture and awareness to engagement, business and investment consultancy, and guidance on tourism. This inspiring new co-operative wants to serve the African community whilst bringing appreciation of African culture to the wider population, and the Hub is keen to see their passion bear fruit.
Flowers from the farm experimenting with flower growing a few years ago and now, with assistance from the Hub, they are bringing co-operative enterprise to a new sector. As a marketing co-op, Flowers from the Farm is a national network that promotes the locally grown flowers of its members, who may be farmers, smallholders or gardeners. It aims to encourage more people to grow flowers and to put customers in touch with local growers in their area, keeping flower growing and buying activity as local and accessible as possible.
Flowers from the Farm is a brand new marketing co-operative in Yorkshire. It has brought UK flower growers together to help them sell their blooms locally. The co-operative was started by a mother and daughter whose family have been farming for several generations. They began
Gill Hodgson, the founder of the co-operative, saw the potential for locally grown flowers and the many attractive varieties that are not commonly sold but flourish superbly and naturally throughout the country. She explained: “By working together we can encourage and promote the British cut flower - helping to make locally grown flowers a more popular consumer choice.” The Co-operative Enterprise Hub assisted Flowers from the Farm with business planning, incorporation as a co-operative, and advice on marketing and website development.
solent bike hub Solent Bike Hub in Portsmouth is a dynamic workers’ co‑operative with four members, which exists to promote all aspects of cycling; from getting youngsters into the saddle, to recycling bikes that have seen better days. It aims to increase access to cycling, and give more young people the skills and abilities to cycle safely and look after their own bikes.
“ We want to raise the levels of enthusiasm and education. ” The co-operative runs a mobile bike mechanic service called Dr Bike, which offers home visits with no call-out charges for addresses in the Portsmouth area. It promotes roller racing, a 1950s revival social sport, which sees competitors racing it out on static bikes that clock up their virtual distance travelled. After setting up as a co-operative in 2011, Solent Bike Hub continues to look at novel ways of realising their ambitions. A cycle cafe is planned, which would allow people to have their bikes serviced while having a bite to eat and socialising. It is one of only a few enterprises to offer such a wide range November 2011
of cycling activities, according to bike mechanic and member Steven Fletcher: “We offer almost everything to do with cycling. We want to guide people into the right channels and raise the levels of enthusiasm and education about all aspects of cycling.” The Co-operative Enterprise Hub helped Solent Bike Hub with its legal structure, business strategy and financial planning, and assisted with its banking and registration as a co-operative.
Starting Out - New Pioneers
High bridge studios Artists using prestigious new studios and gallery space in Newcastle upon Tyne have set up a co-operative because they believe it will provide them with increased security of tenure and better opportunities for fundraising. High Bridge Studios and Gallery, located in the city centre in two refurbished 19th century warehouses, provides 40 studios for rent and two large galleries. The refurbishment was finished in May 2011, after five years of delays, questions and crises that had worried many local artists. Some of the artists wanting to rent studios felt they would be in a stronger position to negotiate with the landlord, Newcastle City Council, if they formed a co-operative and they contacted The Co-operative Enterprise Hub for advice. “We didn’t know how to go about it, and we got great help and advice,” said Dee Shaw who rents a studio. “Kevin [Marquis, the adviser from the Hub] helped us to choose the right co‑operative for our needs, to organise ourselves and to learn the ropes and legalities required in being a co-op.” The artists set up a co-operative consortium. All the members continue to be self employed but the co-operative gives them a legally-recognised body.
They are very committed to community-based arts projects and Dee believes that, as a co-operative organisation, they “will have more clout” in fundraising or applying for commissions.
The Co-operative Enterprise Hub provided High Bridge Studios with business planning and legal advice, and helped the artists register the business as a co-operative.
librAry co-op Library Co-op in London is a new workers’ co-operative dedicated to helping libraries contend with present pressures and helping people improve their libraries. It offers a one-stop shop for library solutions, aims to provide an ethical approach to library management and increase education on the topic. The co-operative also provides expert consultancy on cataloguing, circulation, archiving and digital collections. A dedicated service is offered to third sector groups to help them get the best from their budgets and deliver a professional level of information services. The four co-op members also work with librarians to help communities maintain and rebuild abandoned public library or information services, using a co‑operative ethos.
“ The Hub’s support has been unbelievable and immeasurably more than we expected. ”
A key part of Library Co-op’s agenda is to promote new open source technologies to libraries. This is free software built voluntarily by open communities and shared freely. Library Co‑op works closely with the Software Co-op to deliver this. The members are self employed and come from different professional backgrounds. Brian Millington, the Hub adviser, said: “The co-op occupies a strong niche within the library sector where there’s been an expansion of technology. The members are highly skilled at answering this particular need, and want to do so in a fair and accessible way.” Andrea Chandler, a member, said: “The Hub’s support has been unbelievable and immeasurably more than we expected. We were overwhelmed by the quality and amount of assistance.” The Co-operative Enterprise Hub supported Library Co-op with the development of its legal structure and business plan, and helped it to identify ways of raising funds.
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Choosing Co‑operation Helping existing enterprises to become co-operatives November 2011
New Pioneers The determination of four home care workers who refused to desert the people they had been looking after for so long led to the creation of Cheviot Care. The co-operative provides domiciliary care in Wooler, a small, rural village in Northumberland. The service includes personal care, housework, companionship and running errands. It aims to provide people in need with care in their homes using carers that they know.
Cheviot Care's members took voluntary redundancy from their employer, Northumberland County Council, following its announcement of budget cuts and radical changes to its provision of care. They decided to start something of their own, where they could be in control of who they cared for, for how long, and under conditions of their own choice. They contacted The Co-operative Enterprise Hub at the end of 2010 and, after receiving advice and training, they set up the co-operative in early 2011. In July Cheviot Care gained registration with the Care Quality Commission and began trading. The care co-operative aims to work hand-in-hand with a range of partners to deliver the best possible outcomes for their clients. It works with a variety of individuals and agencies, including family members, Northumberland County Council, local GP surgeries and nurses, occupational therapists and care managers.
“ The Hub gave us so much support setting up the business, much more than we expected. ” Marie Purvis
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THE STORY OF cheviot care
How we helped • We provided Cheviot Care with business planning and advice on financial management and costing, such as hourly rates. • We advised Cheviot Care on its legal structure and registered it as a co-operative. • We gave support in contract negotiation. Tony Kirsop, the Hub adviser, said: “Without the Hub’s assistance, I don’t think Cheviot Care would have been able to trade as a cohesive group. Although they are experts in care, the members knew little about where to start or how to run a business.”
Marie Purvis, Cheviot Care's company secretary with 25 years experience as a care worker, feels strongly about what they do and how far they've come. “I have learned from this experience that, if you set your mind to something, you can really help,” she said. “We wanted to help the people we knew so well and provide continuity for them; some of our clients are the grandparents of people we grew up with. Wooler is an ageing community and it upset us to imagine new, unfamiliar carers coming into their homes.”
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mica diy Mica DIY is a co-operative of retailers that provides marketing, joint buying, store development and training for its members. The co-operative offers its members a beneficial support structure, while allowing them to maintain their independence. The organisation was previously a 60% member-owned business, called Mica UK Ltd. A victim of the recession, Mica UK went into administration in 2009. Wishing to see the benefits of working together preserved, board members chose to set the organisation up again and, in March 2010, members voted to change the ownership to a 100% member-owned co‑operative. It now has over 60 members, with shops across the UK from Shetland to Portsmouth.
Chief Executive, Steve Ball, said: “When Mica UK went into administration, members quickly decided to set it up again as Mica DIY Ltd. “The members felt that it was the right thing to do, as the organisation was already run with co‑operative values. It was a good decision that it should be entirely member‑run. “The dominance of large national and international DIY chains has had a significant impact on smaller independent retailers. Mica DIY supports these independent retailers. “There is also the problem that many of these retail giants sit in retail parks, outside of city centres. Towns and cities are beginning to suffer because of this. The majority of our members own stores in towns, and this goes towards maintaining the local economy”.
“ The members felt that it was the right thing to do ... It was a good decision that it should be entirely member-run. ”
The Co-operative Enterprise Hub helped Mica DIY to restructure and relaunch and The Co-operative Loan Fund provided a loan for working capital. Dave Hollings, the Hub adviser, said: “Mica DIY needed help with relaunching as a co‑operative as well as advice on refinancing and cash flow.”
Dave Hollings said: “Mica DIY is a great example of how a co‑operative organisation can help small independent businesses in times of trouble. There can be certain limitations for a small business working on its own; however, co‑operation is full of possibilities. Mica can buy in bulk, and pass these savings on to its members.”
THE Fox and hounds The Fox and Hounds, in the picturesque village of Ennerdale Bridge in the western Lake District, is one of several communityowned pubs that have been helped by the Hub.
The parish council was about to conduct a feasibility study to establish a ‘community hub’ when the pub closed in December 2010.
“ People have seen what is possible and started to believe in themselves. ”
The villagers moved very quickly and in just 10 days agreed to establish a co-operative, sell community shares and take on the lease of the pub. The community share issue raised over £83,000 from 182 members and The Fox and Hounds reopened in April 2011.
Small communities across the UK are discovering that co-operative enterprise can make their shops and pubs viable when private enterprise has failed. Over the last few years Ennerdale Bridge, a village of some 200 dwellings, has lost its post office, shop and bus service. November 2011
“The reopening of the pub has revitalised relationships within the village and it has also brought about a massive sense of empowerment,” said Peter Maher, the co-operative’s project manager.
Choosing Co-operation - New Pioneers
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The Fox and Hounds continued
“People have seen what is possible and started to believe in themselves. I have little doubt that the village shop will be the next to reopen.” The Co-operative Enterprise Hub provided advice on the purchase of the lease for The Fox and Hounds and on the community share issue.
The Co-operative Enterprise Hub has also assisted The Butchers Arms in Crosby Ravensworth, Cumbria, which reopened in August 2011 (page 19) and The Foresters Arms in Coverdale, North Yorkshire, which is expected to reopen in December 2011.
Revolver World Revolver World is a rare example of a new co-operative being set up by a private company. Paul Birch, managing director of the successful Wolverhampton-based music company Revolver Records, saw his passion for fair trade taking his business interests in a wholly new direction. He wanted to supply music fans with fair trade T-shirts, but was frustrated by the high prices and lack of variety. He decided to set up a business to source and distribute fair trade goods, and he was convinced that a multi-stakeholder co‑operative would be the fairest structure. © Simon Rawles
After successful marketing of fair trade T-shirts and hoodies, Revolver World soon decided to widen its product range to include coffee sourced directly from co-operatives in Colombia, Tanzania and Uganda.
We feel it is the only fair and equitable way to run global commodities.”
Richard Bickle, one of the directors, explained: “We are keen that everyone along the supply chain - from growers and shippers to outlets and even customers - is treated fairly, so a multi-stakeholder co-operative was created to which everyone will belong.
Revolver World coffee is available at a number of Co-operative stores and it was the coffee served at Co-operative Congress in 2011. Using its music industry experience, Revolver World is targeting the youth market, bringing fair trade to a much wider demographic. A free music download is available with each bag of coffee, and Revolver World is planning to launch fair trade beers in 2012.
The Co-operative Enterprise Hub helped Revolver World with business planning, registering the co-operative and a loan application.
“ We feel it is the only fair and equitable way. ”
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Achieving sustainability
Helping co-operatives to grow and prosper Š Gilmar Ribeiro November 2011
New Pioneers Tees Music Alliance (TMA) is a not-for-profit industrial and provident society that provides a range of services and facilities for the benefit of musicians and their audiences. Based in Stockton-on-Tees in North East England, it runs a recording studio, a live music venue and a music development programme for local bands. Every year it puts on a major outdoor music festival. TMA has been going for 25 years, starting as Middlesbrough Music Collective before it changed its name in 2006. It now employs eight permanent staff and has a number of casual workers it can call on for events.
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THE STORY OF tees music alliance
© Danni Robinson
It has always relied on volunteers and provides them with first class opportunities to develop a wide range of music industry skills, including sound engineering, event management and customer service. The management committee of TMA are also volunteers. Director Paul Burns said: “We’ve grown organically rather than following a set plan. When we started in the late 80s it was a time of unemployment and recession and now we’re here again. We decided to contact the Hub for help with developing a business strategy and financial plan for changing times.” For the first time this year TMA decided to charge entrance for its annual music festival. This had started in 1991 as a fringe event but had grown over the years into a major music festival.
“ Contacting the Hub helped us to refocus our business operation in the light of the economic downturn. ” Paul Burns
How we helped • We provided business planning support and undertook a strategic review in order to determine the best direction for the business. • We helped to develop a funding strategy so TMA could access additional sources of income. • We provided marketing support in order to raise the profile of the enterprise. Mike Berriman, the Hub adviser, said: “Tees Music Alliance has been around over 20 years and has achieved amazing things that a private business or local authority could not. They’ve achieved this because of the buy-in of local people and stakeholders.”
TMA realised that it was no longer financially viable to run a ‘free’ festival and so rebranded it as the Stockton Weekender and sold tickets, although entrance on Sunday was still free. Paul said: “Going from a free event to a paid event was always going to be a hurdle, but we cleared it with room to spare. Numbers were down on previous years but we were expecting that. The people that came in were genuine music fans. It was fantastic given what we had to deal with in terms of the weather, which was horrendous!”
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Greasby PreSchool Playgroup “ The support we received has been invaluable; we needed help with everything and had no knowledge of setting up a business. ” The staff began to step in to serve on the committee and soon realised they were in effect running the preschool. They decided to formalise their management of the group. In 2011 The Co-operative Enterprise Hub helped to transform the playgroup into a workers’ co-operative, with the 10 staff members jointly owning and running the business.
The Co-operative Enterprise Hub has helped one of Merseyside’s longest running child care providers look to a more sustainable future. Originally set up by a few parents who met in the park, Greasby Preschool Playgroup is a well established business; however, its form of governance was proving unstable. It was run by a parent committee, but suffered from revolving door membership, as parents tended to move on when their children started school.
Jean Edwards, a member, said: “We are well regarded in the community and we’ve been here for a long time. Many parents who send their children to us attended Greasby as children themselves, and some members of staff can even remember those parents. The support we received has been invaluable; we needed help with everything and had no knowledge of setting up a business.” The Co-operative Enterprise Hub provided the playgroup with new legal and governance structures, succession and transfer of undertakings, hands-on guidance on accounting systems, in addition to reviewing and advising on contracts of employment and other documents.
CYBERMOOR NETWORKS Cybermoor, the highly successful community co-operative responsible for keeping the remotest town in England in the vanguard of the digital revolution, is embarking on the next stage of its sustainable development with assistance from the Hub. Alston in the North Pennines is the highest town in England and is located in the least populated area of the country. In 2002 a community co-operative was set up to deliver broadband services which the major suppliers were unwilling to provide. Using a high capacity microwave link, Cybermoor now provides a low cost broadband connection for over 350 homes and businesses, many of which could not obtain a connection any other way, either due to their location or their personal finances. In February 2011 it set up a new co‑operative, Cybermoor Networks, to install fibre optic cable so that every home and
November 2010
“ When you look at the wider benefits ... it makes economic sense. ” business in Alston Moor can benefit from super fast broadband. The infrastructure is going to be financed in part by a community share issue. “The main providers won’t do it because they can’t make sufficient profit,” said Daniel Heery, one of the founders of Cybermoor. “But when you look at the wider benefits in terms of local employment, education, enterprise, retention of young people and the reduction in travel, then it makes economic sense to the people of Alston Moor. The Co-operative Enterprise Hub helped with the registration of the new co-operative, provided training for the directors and advised on the share prospectus.
Achieving Sustainability - New Pioneers
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Merthyr Town FC Football came home to Penydarren Park when the fans of Merthyr Town FC joined together to turn around the fortunes of their beloved club. In 2010 the club’s liquidation required it to drop three divisions and forced a move to alternative grounds – some 20 miles away. With advice and guidance from Supporters Direct the fans stepped in to take full ownership of the club and bring it home to Merthyr. Supporters negotiated a return to Penydarren Park for the 2011-12 season and developed a plan to secure a long-term lease on the ground. Following additional support from the Hub the club is working hard to strengthen ties with the local community and establish itself as a centre for social activity.
“ Seeing people come together for a unified cause is very rewarding. ”
John Strand, Secretary of Merthyr Town FC, said: “The main difference now that the supporters own the club is that everyone is working closely with each other, and it’s a very positive atmosphere. Personally, seeing people come together for a unified cause is very rewarding.”
A new business development manager has been appointed with responsibility for increasing the turnover of the business, building links with the community and creating a business plan for the long-term development of the ground.
The Co-operative Enterprise Hub provided Merthyr Town FC with advice on its business plan and marketing strategy, with particular emphasis on increasing its engagement with the local community.
Papay Community Co-op In 2011 a Hub adviser travelled to the far north of Scotland to provide specialist help to one of the UK’s oldest communityowned shops. Since 1980 the Papay Community Co-op has been running the only shop on Papa Westray, one of the most northerly of the Orkney Islands. The co-operative also runs a 20-bed hostel for visitors, a minibus and a community function room, cinema and cafe, which is the main social centre for the 75 residents. Thirty years ago the islanders were very much ‘new pioneers’, with many of them actively involved in the running of the co‑operative. Over the years participation has dwindled, and recently there have only been five people on the management committee. Tim Dodman, the secretary who settled on the island in 2001, said: “We knew that we needed outside help to update our management and administration, so when we heard about the support available from the Hub, we got in touch.” Martin Meteyard, one of the Hub’s advisers, flew up to meet
members at the co-operative’s AGM and also held detailed discussions with the staff and directors on governance and procedures. He said: “They hadn’t really looked at their processes and procedures for a very long time. In a small isolated community where everyone has to get along, it’s more important than ever that correct procedures are followed and that everyone understands the rules.” The Hub adviser drafted amendments to the rules to include an asset lock which should make it easier for the co-operative to apply for grant funding. He also advised on a staff handbook.
accessing finance
helping co-operatives understand and meet their financial needs Š Stuart Walker Photography November 2011
New Pioneers After standing empty for a year, the only pub in the Cumbrian village of Crosby Ravensworth reopened in August 2011 with new owners - a community co‑operative of 300 local people and supporters from elsewhere. With support from the Hub the determined community registered a co‑operative, made an offer to buy the pub and launched a community share issue to raise the money needed to purchase and refurbish the premises. The Co-operative Loan Fund provided a loan to help with working capital. Cameron Smith, treasurer of the new co-operative, said: “This has been an incredible community project to be involved in and this pub will now benefit from having around 300 ‘co-owners’ committed to its future success. We have been overwhelmed with the interest in the project. Around half of our members are local but we have had investors from as far afield as Alaska, America and Australia.”
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THE STORY OF The Butchers Arms The co‑operative’s application to The Co‑operative Loan Fund had been approved early in the process, and this objective appraisal of viability contributed to the success of the community share issue which easily reached its target. Shortly before the pub reopened the co-operative drew down the loan to ease cash flow in the first year.
loan finance with a co-operative face The Co-operative Enterprise Hub works closely with The Co-operative Loan Fund to ensure that co‑operatives receiving training and advice also have access to co-operative loan finance. The Loan Fund is an independent organisation funded by The Co‑operative Group (via The Co-operative Enterprise Hub and Co‑operative Financial Services), Midcounties Co‑operative, East of England Co‑operative Society and Chelmsford Star Co-operative Society. The fund was set up in 2002 to increase the size and scope of the co-operative sector through the provision of ethical, accessible loan finance and to date has lent over £2.3m to co‑operatives. This year the Hub contributed a further £250,000 to the £1.6m fund in response to the increasing demand for loan finance. It lends exclusively to co-operatives, and is entirely funded and run by co‑operatives. So, unlike many conventional lenders, it truly understands and actively supports democratically owned and controlled enterprises. It does not take personal guarantees on loans, and it reinvests its surpluses to ensure the ongoing availability of funds. Co-operatives that have benefited from the services of both the Hub and the Loan Fund include Cafe Kino, a cafe and arts venue in Bristol, and Wild Carrot, a
wholefood shop in Buxton, who both moved premises and greatly increased their sales. Combined advice and loan finance also helped the former local authority project PEARLS in Rochdale to set up as a co‑operative and the nationwide consortium of hardware stores, Mica DIY, to become a co‑operative. Other Hub/Loan Fund beneficiaries include a garage in rural Wales, a child care nursery in Bristol, a grocery store in Manchester and a fair trade wholesaler in Wolverhampton.
HOW WE CAN HELP During the delivery of advice and training, a Hub adviser will discuss finance requirements with the co-operative and explore potential avenues with them, helping with loan applications, where appropriate. The Hub may award small grants, up to £5,000, to co-operatives that secure loan finance. Loans of £5,000 to £75,000 are available from The Co-operative Loan Fund to new and existing co-operatives that are seeking to: • Set up as a new co-operative • Expand their size and scope • Assist an employee buyout or company succession • Purchase a property or business • Purchase capital equipment or create working capital. www.co-operativeloanfund.coop
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supporting co-operatives overseas
promoting co-operative enterprise as a means of alleviating poverty November 2011
New Pioneers The Co-operative Enterprise Hub believes that, by equipping people with the skills and knowledge to build successful co‑operative enterprises, it is helping them to build better lives for themselves and their communities. Our work extends beyond the advice and training provided to co-operatives in the UK, to a number of projects overseas that seek to promote co-operative enterprise as a means of alleviating poverty.
Kibagenge means ‘coming together as one’ in the Kenyan communities where the Hub is supporting smallholder tea farmers to organise into co‑operatives.
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the story of kibagenge
we are also helping ...
A Hub investment of £125,000, match funded by the Department for International Development, is being used to train 11,000 farmers in co‑operation and help them work towards the Fairtrade certification that would guarantee a minimum price for their tea. One co‑operative has already achieved Fairtrade certification.
• Communities in South Africa to develop funeral co-operatives as a way to reduce the costs for poor families. We have allocated £46,000 to the project, and two co-operatives are being developed.
Peter Marks, Chief Executive of The Co-operative Group, visited the Kenyan project to meet the famers and see how the formation of the five new co‑operatives was already having positive outcomes. He said: “By forming into co-operatives, farmers have benefited in many ways, including having a stronger voice in trading negotiations and enjoying improved access to markets. They can also build a business they own and in which they will share the profits. Fairtrade certification will guarantee a minimum price for their tea and enable them to supply into The Co‑operative’s ‘99’ Fairtrade tea blend, as well as to other retailers in the longer term.”
• To strengthen the links between Fairtrade towns and co‑operatives. We have invested £44,500 in the redevelopment and promotion of a Fairtrade Towns pack and website, which encourages local groups and co-operative members to work together for their mutual benefit.
The project is being delivered by the Hub in partnership with The Co‑operative Food and the Co‑operative College in the UK, and the NGO Africa Now and tea supplier, Finlays, in Kenya.
• The co-operative sector in Malawi to identify a programme for sustainability and growth. We are providing £15,500 to fund a study of the co-operative sector.
For more information, please visit: www.co-operative.coop/overseas-co-operatives
“ As well as higher income from our tea, we will also have access to loans, which means we will be able to put our children into education. ” Zeddy Simotwo
Renewable Energy co‑operatives combating climate change at a community level
New Pioneers Energy4All was conceived following the successful creation of Baywind, the UK’s first community wind farm co-operative. The founding members of the Baywind co-operative decided that the skills and experience they had amassed in realising their project could be of use to other communities exploring similar developments. They set up Energy4All with the aim of expanding the number of renewable energy co‑operatives throughout the UK.
The Co-operative Enterprise Hub has supported Energy4All with a grant of £40,000. This has been used to provide financial support to a variety of projects, such as Deeping St Nicholas wind farm, in Cumbria, Westmill wind farm, in Oxfordshire, and Millennium wind farm, in Invergarry. Energy4All also has a long-standing relationship with The Co‑operative Bank.
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the story of Energy4All we are also helping ... Water Power Enterprises (h2oPE) to set-up small-scale hydropower projects that benefit both the environment and local communities. We provided a grant of £45,000 to h2oPE’s maiden project, Torrs Hydro in New Mills, Derbyshire, which was the UK’s first community and co‑operatively owned and run hydropower scheme. Similar projects in Settle and Bainbridge, in North Yorkshire, and two small-scale hydro installations in Stockport, are also benefiting from the Hub’s support.
“ We see the Hub as a real friend and partner in delivering our challenging programme of new co-ops in this fastchanging sector. ”
Sheffield Renewables to improve Sheffield’s environmental sustainability through the development and ownership of renewable energy schemes in and around the city. The Hub’s grant of £25,000 will enable Sheffield Renewables to cover the core costs of their first two micro-hydro projects at Jordan Dam and Kelham Island.
Andrew King, Energy4All
For more information, please visit: www.co-operative.coop/community-renewables
The Co-operative is among the world’s leading businesses when it comes to taking up the challenge of combating climate change. The Co-operative Enterprise Hub is contributing to the business’ wider approach through its support for communityscale renewable energy initiatives. A dedicated fund has been established by the Hub to provide grant assistance to enable community-owned renewables schemes to get off the ground. Communities have a vital role to play in enabling the UK to meet its climate change targets, and the
co‑operative model is one that more and more are considering as they come together to pursue renewable energy solutions in their locality. To date, the Hub has provided grant funding and consultancy to help co‑operatives to set up and launch share offers. Going forward, the Hub’s offering will expand from a simple grants scheme to the provision of bespoke professional consultancy services that help projects overcome some of the hurdles that can arise in the feasibility, planning, and finance-raising stages. This will be complemented by further collaboration with The Co-operative Bank for the provision of project finance and with The Co‑operative Loan Fund on a brand new package to support community share offers.
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looking ahead The Co-operative Enterprise Hub has ambitious plans for the coming year – a year in which co-operation will find itself very much in the international spotlight, as we celebrate the UN International Year of Co-operatives. The Hub will also attain a significant milestone in 2012, as we support our 1,000th co-operative with free advice and training. In line with the commitments set out in The Co-operative’s Ethical Plan, we are about to expand the Hub’s offer to create a unique programme for young people who wish to start up co-operative businesses. Work is underway on the creation of the £20m Global Development Co-operative heralded by the Plan. It will provide loans to co-operatives in the developing world.
November 2011
Our commitment to both business and ecological sustainability is coming together in a new green energy buying offer for Hub clients. From 2012, co-operatives supported by the Hub will be able to benefit from the purchasing might of The Co-operative to buy green energy at discounted rates. This scheme builds on a pilot that was successfully tested with the help of the Plunkett Foundation and Supporters Direct. The Hub’s offer continues to adapt and expand to the changing needs and demands of the co-operative sector – be it the need to ensure the consistent quality of co-operative development advice or the demand of employees who find themselves in buyout situations. This is another exciting chapter for the Hub, for co-operative development in the UK and beyond and for the many new pioneers who are waiting in the wings ready to realise their dreams of running sustainable, socially responsible and inclusive businesses.
If you’ve been inspired by the stories of our New Pioneers and want to join the revolution, The Co-operative Enterprise Hub can support you to develop or grow your co-operative enterprise. Simply get in touch to arrange a visit from one of our professional advisers.
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The Co-operative Enterprise Hub is a working name for Co-operative Action Ltd. Registered Office: Co-operative Action Ltd, New Century House, Corporation Street, Manchester, M60 4ES. Registered in England/Wales. Registered No. 4495012.
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