Reports show an increase in the number of co-operatives having been established in 2020/21 as businesses search for recovery solutions.
Faced with cancelled orders, falling sales and a lack of wholesale trade opportunities, hundreds of smaller enterprises were staring down a bleak future when the Covid pandemic took hold in Spring 2020.
Whilst many took advantage of Government support, others such as artisan food producers and craft breweries, needed to find a way to clear through stock that would otherwise have gone to waste, resulting in the loss of thousands of pounds of valuable capital – making recovery difficult if not impossible.
Moving Business Online
Due to the size of their businesses and lack of access to ready capital, not everyone was able to pivot in the same way as larger and more established businesses did, moving their business online overnight, offering drive through or click-and-collect. Many even lacked the additional capital required to convert their websites to ecommerce.
But reports are now emerging around the country of an increasing number of co-operatives having been established in 2020/21 as these smaller businesses turned to their neighbours, grouping together to develop combined sales platforms, generate new brands and establish more resilient and profitable partnerships.
From local and regional food co-operatives to shared retail spaces (both digital and physical) it would appear collaboration has, for many, been the solution that will enable them to keep trading. Having created loose collaborations during lockdown, there is now an increase in the number of co-operatives formally registering as the partners realise the benefit of working together.
Co-operatives: Safety in Numbers
Co-operatives have a long history of helping smaller producers or groups of businesses come together to enjoy the benefits of broader skills and knowledge, shared risk, greater capitalisation, increased purchasing power and in most cases a more attractive proposition for customers. Originally started in the 19th century there are now more than 7,000 registered in the UK alone, out of a Global community of over 3 million like-minded organisations.
And for those establishing a co-operative, there’s good news too as in terms of a business model, they are nearly twice as likely to survive as more traditional new businesses.