The Co-operative reverts to profit-sharing scheme

29-08-2006

The Co-operative group has today announced a significant shake-up of operations, marking a return to the "divi" scheme it championed until the 1970s.

From today onwards customer members will be able to gain a share of the group's profits by a single membership card that allows them to benefit from the entire spectrum of the Co-operative's businesses, from groceries to funeral homes.

Included in today's revamp is the renaming of the group's businesses to a collective 'The Co-operative' brand.

Some 3,000 of Co-operative's high street and village outlets, pharmacies, travel agencies, banking and insurance branches will be remarketed under the single brand, with the group attempting to boost its membership from 600,000 to four million by the end of the decade.

The Co-operative is by far and away Britain's largest consumer-owned retailer, but has suffered in recent years from the aggressive market share-increasing behaviour of the big four supermarket retailers, namely Tesco, Morrisons, Sainsbury's and Asda.

Martin Beaumont, the group's chief executive, 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."

Under the new system, customers will be awarded a lump sum twice a year based on how much money they have spent at Co-operative stores and the resulting profits that were made.

Although the direct translation between the amount of spending and money to be returned cannot yet be established, consumers will earn one point for every £1 spent on food, travel and funerals, while for every £5 that goes through the Co-operative's financial services, they will be credited with one membership point.

"We are already one of the most trusted brands in the UK and this will continue to build on our existing strong corporate image and reputation. We are committed to being the country's first choice community provider," concluded Mr Beaumont.


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