New 'divi'? Ours never stopped!

THE East of England Co-op said yesterday it was “delighted” after the national Co-operative Group announced plans to return to the traditional dividend scheme for which the organisation was once famous.

THE East of England Co-op said yesterday it was “delighted” after the national Co-operative Group announced plans to return to the traditional dividend scheme for which the organisation was once famous.

The Co-operative Group unveiled a new corporate identity and details of a profits-share scheme covering its 3,000 high street and village outlets

But the East of England Co-operative Society, which has kept faith with the scheme over many years, pointed out that its members would continue to benefit from its own dividends.

Under the measures announced by the Co-operative Group, around two million members will receive a share of profits based on their level of trading with the group's range of businesses, which stretch from food retailing and funerals to banking, insurance and pharmacy services. All the operations will use the same branding, The co-operative.

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The co-op “divi” was a feature of life until the 1960s and 1970s, when a number of societies phased out the initiative because of the cost and time involved.

A spokesman explained that technology now made it easier to introduce a similar profits-share operation in place of a previous loyalty scheme.

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Cardholders will have the opportunity to provide support for local projects by electing to donate all their share of profits to the group's community dividend scheme, which distributes grants to community groups.

The cost of becoming a member of the Co-operative Group is £1. Under the terms of the new scheme, members will earn points on trade with all group businesses, including the Co-operative Bank and Co-operative Insurance (CIS).

The first payment - based on profits for 2005 and the first six months of this year - will be made in December.

The East of England Co-operative, the largest community retailer in East Anglia, has 200 trading outlets in 65 towns and villages, stretching from Burnham-on-Crouch in Essex to Sheringham in Norfolk, and operates independently from the Co-operative Group.

Its head of corporate affairs, James Day, welcomed the news that the national group was returning to the scheme.

“The East of England Co-operative Society is a member-owned organisation, sharing the same values and principles as the Manchester-based Co-operative Group,” he said.

“However, our members have been able to earn a traditional dividend on their purchases for many years, and we are delighted the Co-operative Group has decided to launch its own similar scheme.”

The East of England Co-op's dividend scheme enables members to earn dividend at all its trading outlets where dividends are now given. At the end of the year, the more points members accumulate, the bigger their share of the profits are.

“We have many committed co-op members who shop with us on a regular basis,” said Mr Day.

“Our members tell us that dividend is important to them, and we are sure that it has contributed greatly to our success over the years.

“But dividend is not the only factor. We believe our localness and the quality of our stores together with good service and our community and ethical stance is vital to retailing success.”

Co-operative Group chief executive Martin Beaumont said: “At a time when communities are becoming increasingly dominated by a handful of large and impersonal businesses, we want to show UK consumers that there is a better alternative, one which is ultimately owned and controlled by them.”

The initiative is only applicable to the group and its commercial operations and does not include regional co-operative societies.

The Co-operative has around two million members but hopes this figure will rise to four million by 2010, partly as a result of its approach to ethical trading.

As well as responsible food retailing, the Co-op is known for its stance on ethical shareholding at CIS.

The business made profits of £366 million in 2005, including £98 million from its banking operation, which features the online business smile.

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