Sarah Deas: Scots businesses should consider advantages of co-ops

Published on 30/03/2012 00:00

UK PARTY leaders are waking up to the attractions of co-operative business models, which offer companies a real alternative to the status quo.

Here the Scottish Government has been ahead of the curve in encouraging companies to band together for their greater good. It’s a strategy that can pay dividends in good and bad economic times.

Back in 2006 Co-operative Development Scotland (CDS) was set up as a subsidiary of Scottish Enterprise to help companies grow. Now, in 2012, we have more than 550 co-operative businesses with a combined turnover of more than £4 billion and employing 28,600 people. But we want to see more.

Last night First Minister Alex Salmond hosted a reception at Edinburgh Castle to mark the launch of the United Nations-led International Year of Co-operatives (IYC) in Scotland and a new £30,000 Collaboration Prize. The prize challenges companies to devise the best idea for a new consortium co-operative business. In his speech, the First Minister called on more Scottish firms to consider pooling their collective expertise. .

So how does this work in practice? Consortium co-operatives are established when groups of companies come together. The consortium is run on an equal basis for its members. It may be set up to buy or sell in scale, market more effectively, share facilities or jointly bid for contracts.

Evidence from across Europe shows this ground-breaking business model boosts innovation and growth.

In Scotland companies are reaping the rewards of this innovative way of doing business. Yellow Brick House is a new media agency born of four leading players from our digital industry. In short, the collective bargaining power of the new consortium co-operative beefs up their market presence, without compromising anyone’s independence. The business goes from strength to strength.

So we echo Mr Salmond’s call to businesses across Scotland to consider the advantages of working together.

• Sarah Deas is chief executive of Co-operative Development Scotland (CDS)