Co-operative shares £50m with members

THE Co-operative group – which includes food and travel stores, funeral directors, chemists and the Britannia building society – is paying out a record £50 million dividend to members in the next few days.

Britain's largest mutual retailer, which was the first UK company to use Bob Dylan's Blowin' in the Wind for a commercial, made a profit of 402m last year.

About 7m will be shared between the group's 350,000 Scottish members, who will earn 2p a point based on the amount of money spent in the various businesses across the group.

Patrick Allen, director of marketing at the Co-operative Group, said: "It is only right that our members, who ultimately own and control the business, get to share in our success.

"Last year was particularly successful for us. The trading group acquired Somerfield, CFS (Co-operative Financial Services) merged with Britannia and we launched the new Co- operative brand with a high-profile advertising campaign.

"As a member, the points quickly add up. Someone spending 20 a week in our food stores takes a 1,500 holiday with our travel business and buys a funeral plan would earn 85.80 in the course of a year."

The Co-operative Group currently owns 378 Scottish stores, including 78 which used to be Somerfield stores but which are being rebranded.

However, the acquisition was not completely straightforward – and the group was forced to sell 133 former Somerfield stores after intervention from the Office of Fair Trading, which objected to a single retailer owning more than 25 per cent of the market share in any particular area.

Ed Garner, a retail analyst for Kantar Worldpanel, said: "The Co-operative is certainly growing as a fascia and it has established a reputation for things like ethical trading and fair trade.

"But there are still challenges in rebranding Somerfield stores, because they are taking over a group of customers who are older and more conservative and who might be put off by the rebranding."

Businesses previously known under various names, including the Co-op, are being brought together under the Co-operative brand, which was relaunched last February in a multimillion pound rebranding exercise which was given rare permission to use Bob Dylan's classic protest song.

Some operations from the Britannia Building Society, which was headquartered in Leek in Staffordshire, and the Somerfield chain, based in Bristol, are being relocated to Manchester, which is the home of the group.

All customers are entitled to apply for a single share in the Co-operative with which they can accumulate points based on the amount they spend at any of the group's businesses.