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Co-operatives grew faster than the economy as a whole in 2011 for the fourth successive year, confirming their resilience in tough times.
The movement posted annual growth of 1.5 per cent, compared with 0.7 per cent for the UK economy.
Co-operatives’ turnover is 19.5 per cent above its 2008 level, while gross domestic product has fallen 1.7 per cent.
“We are outperforming the British economy,” said Ed Mayo, secretary-general of Co-operatives UK. “We are not trying to sell things people do not want to buy. It’s not luxury goods, it’s food, farms, funerals and energy.”
He said while co-ops rarely experienced explosive growth, their democratic structure, closeness to customers who were often members, and reluctance to borrow helped them survive tough times and could prove a model for the future of capitalism.
“The survival rate for co-ops is significantly better than businesses at large,” he added, saying corporate Britain could learn from the mutual movement.
However, the sector failed to create jobs, with the number employed falling from 235,961 in 2010 to 223,840 in 2011.
According to Co-operatives UK’s annual economic report, the sector earned £35.6bn in 2011 with an 8.9 per cent rise in the number of co-operative enterprises to 5,933 and a 5 per cent rise in membership to 13.5m.
Return on capital employed by consumer co-operatives, the bulk of the sector, fell from 12.8 per cent to 10.6 per cent while trading profit margins before depreciation slipped from 9.4 per cent to 7 per cent.
The government has called for an increasing role for member-owned businesses in public service delivery and attempted to boost staff ownership.
Retail (71.7 per cent), agriculture (11.4 per cent) financial services (6.2 per cent) remained the largest sectors they operated in. Areas with the largest growth included renewable energy co-operatives and schools, with 242 now owned by communities, teachers and parents.
But some in the movement say it lacks ambition. The two largest co-ops, the Co-operative Group, the retail and banking business, and the John Lewis Partnership department and food store chain accounted for £23bn, or two-thirds of co-op revenue, and only 484 co-ops had more than £5m turnover.
Jim Pettipher, deputy chief executive of Co-operative Futures, which advises co-ops, said: “The sector is 2 per cent of GDP. As a return on capital over 150 years that is pretty poor. We need more entrepreneurial fire in the belly.”