History of Co-ops

Today's Co-ops trace roots to 19th Century England.

More than 150 years ago, a small group of English workers launched an economic experiment that later would spread throughout the world. The annual observance of October as Co-op Month commemorates the implementation of that concept in the United States.

Today, millions of Americans are members of organizations established on a cooperative basis and millions of others come in contact with cooperatives more often than they may realize. Credit unions, mutual insurance companies, some day care facilities, the Associated Press news wire service and a number of retail firms are among the 48,000 U.S. businesses operating as cooperatives.

In agriculture and rural America generally, cooperatives are especially prominent, providing a wide range farm supplies, energy, telecommunications, and marketing, processing, financial and other services.

The growth, development and scope of cooperatives in this nation and elsewhere are a marked contrast to the organization officially incorporated on Oct. 24, 1844, in Rochdale, England. In that community, east of Manchester in the heart of northern England's textile manufacturing area, 28 people--most of them weavers--banded together to form the Rochdale Equitable Pioneers Society.

The Society did not originate the cooperative idea, which had been around for many years. Among the cooperatives that predated it were the Pilgrims' Mayflower Compact and the mutual fire insurance companies that Benjamin Franklin started in colonial years. So, the significance of the Rochdale Pioneers was not in what they did but how they did it.

The foundation on which they built their organization was a set of organizational practices and descriptions now known as the Rochdale Principles. None of these ideas were totally new, but together they produced a system that was unique. Included were:

• Democratic control.
• Open membership.
• Fixed or limited return on capital subscribed.
• Dividends on purchases.
• Trading strictly on a cash basis.
• Selling only pure and unadulterated goods.
• Provision for the education of members.
• Political and religious neutrality.

The primary goal of the Rochdale group was modest. They simply wanted to stretch their meager earnings by purchasing needed supplies in larger volumes at lower prices.

The new organization began its operations in a small, rented, first-floor store. Although the group outgrew that facility and later moved to another location, the original site, at 31 Toad Lane, is considered the birthplace of the modern era of cooperative business.

What happened at Rochdale was devoid of glitz and fanfare. Toad Lane itself was dark, grimy and lined with warehouses. In those early years of the Industrial Revolution, most of the founding group led lives filled with little else but hard work at low wages. Their working conditions would be seen as intolerable today. Unable to earn enough to support themselves and their families, they grasped at a straw they hoped would lower their cost of living.

It's unlikely these desperate workers with little formal education cared much about the concept of cooperation per se or contemplated the idea that they were establishing a long-term, worldwide movement. Nonetheless, while modern-day business practices have brought some change to the original set of principles, the essence of cooperation embodied in them continues today.