Workers’ co-operative unites world’s vegetarians
When Stephen Newton tells clients of the food wholesaler he works for that he is “sales director”, strictly speaking, he is inventing a job title for himself.
But Mr Newton is not being disingenuous. Instead, the designation is an attempt to help customers on the other side of the world understand his role at Suma, where he has worked for 12 years. The business is a workers’ co-operative, which is owned and run by its members, who are all paid the same. There are no managers.
“I use the title so they know that I am able to make business decisions and take responsibility for our business connections,” he says, speaking from Suma’s offices in Elland, in West Yorkshire.
The unusual structure has not put the brakes on international expansion for Suma, which has been awarded a Queen’s Award for international trade.
The products it sells, which are always vegetarian, organic and ethically produced, include items such as Green & Black’s chocolate, Duchy Originals biscuits, Yeo Valley yoghurt and Ecover cleaning products, and are now available in 40 countries, including as far away as Asia.
Suma also sells own brand goods, from baked beans and cereals to beer and soap.
It started out in 1975 as a supplier of wholefoods such as cereals, dried fruit and rice. The move into exporting began two decades ago in response to demand from British expatriates who were living in countries such as France, Spain or Cyprus and missed the vegetarian or vegan foods they were used to at home. In addition, Britain’s very high standard of food regulation means that consumers trust it for quality and authenticity, which helps when it comes to exporting.
The initial quantities shipped were small but then requests from customers further afield began to increase dramatically. Mr Newton attributes this to the internet making it easier for consumers and the importers to find out about the company and to make contact.
Exports, which account for about 13 per cent of revenue, are now the fastest growing part of the business. Overall sales are expected to top £50m in the year to September.
The co-operative movement in Britain is usually said to have begun with the Rochdale Pioneers in 1844, 20km from Elland. There were 6,797 co-operatives in the UK last year employing more than 222,000 people, according to Co-operatives UK, a lobby group.
However, the movement has been tarnished in recent years because of long-running problems at the Co-operative Group, the UK’s biggest mutual, which almost collapsed in 2013 because of a hole in its bank’s balance sheet. The Manchester-based group has since sold or scaled back several businesses to shore up capital.
After 42 years, Suma remains independent. With all workers earning a little less than £16 per hour, the only variation in salary is down to the hours that an employee chooses to work.
They are also encouraged to perform more than one role. Mr Newton focuses on the export side of the business, but he also cooks — vegetarian — lunch for employees and until recently his duties included driving a delivery van.
Newcomers to the business might imagine that the requirement to turn a hand to more than one role, the flat wages and the management structure, or lack of it, would impede the notoriously fraught process of entering new, competitive markets.
In fact, the process for deciding whether to start supplying a particular market is straightforward, says Mr Newton. The six workers who focus on the export side of the business have a weekly meeting during which they discuss feedback from customers and gossip from events such as trade fairs, and decide whether it is worth exploring a new area.
They also seek outside advice: in the case of Suma’s recent expansion to Japan, it consulted the British embassy there as well as Export To Japan, a body promoting trade between the two countries. The next step is to make a presentation at one of Suma’s quarterly meetings, where all 160 staff members can vote.
“It’s immediate, you can crack on the next day,” says Mr Newton. “When a decision is made, it is quite swift.”
Although extensive groundwork goes into preparing the case for a new project before its presentation to members, there is a risk that the three months between meetings might be a drag on decision-making.
However, there is a small group of members, who represent all other workers, that he can approach at their weekly meeting for approval for smaller projects such as a foreign trip.
Far from having to extol the virtues of vegetarian or ethically produced products to potential new customers, Suma has found that interest in such goods is already high.
Jennifer Zegler, global food and drink analyst at Mintel, says there is generally more interest in a varied and healthy diet. “While there are some consumers who are more interested in adhering to vegetarian or vegan diets, what has changed in the past decade is that vegetarian and vegan food and drink has gained more mainstream appeal.”
Last year, almost 11 per cent of new food and drink launches tracked by Mintel across the world made a vegetarian claim, up from 3 per cent a decade earlier.
If anything, says Mr Newton, foreign demand for certain products has helped Suma to expand its range in the UK, with east Asian demand for gluten-free products being an example.
Suma is now eyeing opportunities in fast-growing south-east Asian economies such as Thailand, Indonesia and Vietnam. Moving into the US and Canada is off the table for now because of the legal complexities of entering those markets, he says.
The benefit of the co-operative system, Mr Newton says, is that it forces him to think extremely hard about where the business deploys its resources.
“That money is my peers’ money,” he says. “It means that I have to really focus on what I’m doing — I have to justify everything.”
A list of this year’s winners and a guide to applying for a Queen’s Award are available at www.gov.uk/queens-awards-for-enterprise