Why did co-ops develop?
The popular image of 'the Co-op' as a single, national organisation is far from the reality. The Co-op - or the Co-operative Movement - is in fact international and made up of millions of separate, independent societies but they all have a common heritage, and exist to serve their members.
The world-wide Movement has its roots in the early part of the nineteenth century when the industrial revolution resulted in exploitation and misery for many working people. The development of shops failed to keep pace with the growth of the new industrial communities and often people had no choice but to buy goods from unscrupulous local shopkeepers who had a monopoly of trade. These private traders adulterated products, for example putting chalk in flour, and reaped large profits.
At this time, nonconformist churches and the development of political movements such as the chartists, gave ordinary people who were all suffering the same injustices, the chance to join together. This, coupled with the fact that the ideas of social reformers such as Robert Owen and Dr William King, were attracting attention, led to people recognising that collective action was a way they could meet their shared needs.
They formed trade unions to overcome exploitation at work and set up co-ops to overcome exploitation as consumers.
The co-op shop that is acknowledged as the place where the Movement began, was opened by 28 workers on Toad Lane in Rochdale, Lancashire in 1844. The founders are known as the Rochdale Pioneers.
The Rochdale Pioneers
The Rochdale Pioneers are recognised throughout the world as the founders of the Co-operative Movement.
In 1844 28 working men gathered together to set up the Rochdale Equitable Pioneers Society and opened a co-op shop on Toad Lane in Rochdale. They sold basic items such as flour, butter, tea and candles, but it was how they ran the business that made them different.
They had decided it was time shoppers were treated with honesty, openness and respect, that they should be able to share in the profits that their custom contributed to and that they should have a democratic right to have a say in the business. Every customer of the shop became a member and so had a true stake in the business.
This way of doing business was revolutionary. These businessmen didn't adulterate products, putting leaves in tea or chalk in flour. They didn't simply see customers as the way to make a profit at the expense of others. They believed that pooling resources and ensuring everyone benefited, was the way to do business. Unsurprisingly, and to the annoyance of other traders, the reputation of the co-op shop was soon established and customers flocked to it, certain that they would be served quality products at affordable prices.
The Rochdale Pioneers made no secret of the principles that underpinned their business. They were what set them apart from all the other traders - they were the key to their success. The principles were -
- Open and voluntary membership
- Democratic control (one member, one vote)
- Fixed and limited interest on share capital
- A surplus allocated in proportion to members' purchases (the dividend)
- Provision for education
- Co-operation amongst co-operatives
- Political and religious neutrality
- No credit
- Quality goods and services
Very soon, co-op shops were appearing everywhere and the Rochdale Pioneers began to gain international attention. Although co-ops had been set up before the Toad Lane shop, it was this one that was a real success and therefore the one that became the example that other co-operators followed.
The principles are still accepted today as the foundations upon which all co-ops are based. However, to ensure they are still relevant, they have been examined and revised.
Biographical details of the original Rochdale Pioneers.
To find out more, go to the Values and Principles section.
Find out more about our Rules of Conduct.
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