Platform co-ops – your route to an ethical digital business

Ludovica Rogers

In our latest blog, we are pleased to welcome Ludovica Rogers, Programme Manager, New Co-op Ventures at Co-operatives UK who shares her insight on how co-ops can provide a more ethical, values lead approach to digital business.

The rise of digital platforms such as Uber and Deliveroo may have provided consumers with greater choice and convenience, but it’s come at a cost – to the riders, drivers and others on the frontline of those services. The gig economy that’s emerged through these digital innovations has exploited regulations, increased precarious working and created the conditions for tech giants to dominate markets.   

There is a fairer alternative though: platform co-ops. These are democratically owned and controlled businesses that use an online platform or app to trade. A platform co-op is built on co-operative principles and values that ensure the business truly responds to the needs of its community and embeds equity from day one. The co-op model also keeps control away from external profit driven investors. 

Platform co-ops put the power, profits and control in the hands of the people providing the service and, in some cases, the service users too. BSL interpreting service Signalise is a perfect example. Based in Merseyside, Signalise uses a digital platform that brings together Deaf people, British Sign Language interpreters and health staff, doing away with the profit-led corporations that have traditionally been the connection between these groups. 

Both service providers and users have a stake in the co-op and they’re the ones in control. Interpreters and deaf members come together to collaborate, discuss and drive the business, for their mutual benefit. 

Wings delivery service in North London is a platform co-op created in direct response to the gig economy in which riders’ earnings are unpredictable and often below the minimum wage. Launched in July 2021, Wings pays riders a guaranteed London Living Wage. It also provides them with job security, sick pay and benefits. 

Wings operates with 100% zero-carbon vehicles and is committed to prioritising local, independent businesses over big chains. It was set up with the support of the UnFound Accelerator – a 10-week development programme for start-up businesses that use mobile apps or online platforms to provide services and solutions.  

Delivered by Co-operatives UK and Stir to Action, supported by The Co-operative Bank, the UnFound Accelerator draws on an extensive network of experts to help platform co-ops plan their businesses and develop their products, strategy, branding and marketing. The next Unfound Accelerator will be running in spring 2022 and applications will be open from 6 December 2021. Find out more here.

Open Food Network UK is another platform pioneer. It’s a co-op that brings together many different organisations whose members collectively own and control an innovative software platform they use to trade the food they produce.   

The co-op’s membership comprises food hubs, farmers, growers, community food enterprises, shoppers and buyers. The software allows them to connect with everybody else in the country using the platform, and to create their own online shop fronts. 

Trading this way creates short supply chains – where the distance between food and fork is as short as possible, which reduces costs, waste and environmental impact. 

An English language school, wine merchant, taxi app and social care provider – these are other examples from the burgeoning platform co-op movement. It’s not just about creating better conditions for workers– it’s about using technology innovatively and ethically to find solutions that meet a need while benefiting everyone involved. 

If you have an idea for how a platform co-op could form the basis of an ethical business – or you’re keen to find out more – join me and other speakers at 1pm on Tuesday 25 January 2022 for a short introductory webinar delivered in partnership with Co-operative Development Scotland, part of Scottish Enterprise. Book your place here. See you there! 

Can co-ops drive climate action?

With COP-26 underway, messages about the climate emergency will dominate all media outlets over the next few weeks and well into the future as we try to grapple with what is by far the most important issue globally. As the delegates arrive in Glasgow, we thought it was timely to catch up with Darah Zahran, team leader at Co-operative Development Scotland (part of Scottish Enterprise) on how Co-ops can play a part in supporting the climate agenda.

During the COP-26 summit, we will all look to world leaders to drive significant and long-lasting change. It is sometimes easier to look for answers from others and with the significant challenges our planet faces, there is no doubt that strong leadership is of vital importance, but we can all play a part by considering what we buy, our transport methods, how we spend our time and importantly how we do business.

Increasingly our team has been making connections between co-ops and more sustainable ways of doing businesses. We work with many community co-ops where care for the environment is a critical part of their ethos. A great example is the Isle of Eigg Brewery, Scotland’s first co-operative brewery. They are a people-centred, values-based business who also strive to be as low carbon as possible.  We also work with many community shops who prioritise local suppliers, adopting a business approach which, by its very nature, produces less carbon than sourcing from those further away. Energy is another critical sector where we see a lot of interest as communities meet consumers’ needs in a much less harmful way, while generating income to reinvest in the community. Our recent guest blog from Community Shares Scotland is a great source for more information about these businesses.

In time for COP-26, our partners at Co-ops UK published a significant report titled The race to net zero: The role of co-ops in driving climate action post-COP26. The report shows what we were already sure of, that co-ops are taking the issues of climate seriously. 66% of the co-ops surveyed are taking action to reduce carbon emissions. 23% have gone as far as publishing a strategy to achieve net zero and 61% are taking action to reduce the amount of greenhouse gases they produce. Those are significant stats when you compare them to the UK’s FTSE 100 companies where only 30% have pledged to eliminate their carbon emissions by 2050. However, there is more to be done and the scale of change across the co-op sector, as with wider business, is significant. The survey identifies where further support is required: 41% of participants wish for more grant funding to be made available to implement net zero strategies and 40% wish to access expert advice and guidance on developing low carbon or net zero strategies.

The co-op sector is an exciting place to work and provides hope for a better way of doing business that puts people and planet before profit. As the sector grows and with good access to support, we believe values-led, inclusive business models will play a key role in balancing our environmental, economic and social responsibilities through fairer business practices. Find out about the support available to set up a Co-op on the Scottish Enterprise Website: https://www.scottish-enterprise.com/our-organisation/about-us/who-we-work-with/co-operative-development-scotland

The role of community business in shaping our future

This month we are pleased to feature a guest blog from Katie Little from Community Shares Scotland. Read on to find out more about Katie’s thoughts on the role of community enterprise in the race to zero .

With the COP26 conference starting next week and an increasing focus on a community wealth building agenda, the role that community enterprise can play in shaping the future of our just transition to net zero is becoming increasingly evident. Recent conferences from the Scottish Government’s Community and Renewable Energy Scheme and the Development Trusts Association Scotland have reinforced this, focusing on community-led climate action and featuring case studies highlighting the breadth of action that is going on on the ground in communities across Scotland.

Since Community Shares Scotland was launched 7 years ago, we have supported dozens of successful community share offers. In that time, no sector has seen more investment than community owned hydro, driven by schemes such as Harlow Hydro and Cumhacd Shlèite, who want to support sustainable economic, environmental and social development in their communities. By generating clean, green energy these renewable energy projects have been able to use the income generated through electricity sales for community benefit, in addition to raising awareness of environmental issues and community ownership. Due to a lack of accessible land and the current limited profitability of such schemes (as a result of the Feed in Tariffs coming to an end) these kinds of community enterprises aren’t possible for every community. So what are other Scottish community businesses doing?

During Climate Fringe Week, Community Shares Scotland highlighted some of the other enterprises that are playing their part in the just transition.

Isle of Eigg Brewery is the first brewery in Scotland to be wholly owned as a community benefit society, and their ethos is to be as low carbon as possible. They hope to achieve this through a variety of methods including installing solar panels and battery technology to harness renewable energy; creating self-sufficiency throughout the brewing and fermenting processes with heat generated from brewing fed back into the system as well as creating local jobs in the process.

Loch Ness hub, a community owned tourism hub which provides information, tours and baggage transfers for tourists visiting Glen Urquhart and Loch Ness are championing a greener, slower tourism approach. They are developing active travel paths in the area; introducing bike and e-bike hire, expanding the EV charging network as well as introducing car sharing schemes.

So what might be the next trend for community enterprise? A recent community share offer was launched by Manchester based People Powered Retrofit, a not-for-profit, community energy co-operative designed to help households source reliable retrofit services, creating greener, more energy efficient homes in Greater Manchester. With an estimated 50,000 non-domestic buildings and up to 1 million domestic homes in Scotland needing to be decarbonised as we transition to net zero, there could be an opportunity for communities to take advantage of this bottom up approach to meeting the carbon neutral challenge.

People Powered Retrofit demonstrates the possibilities for community enterprise on a bigger scale, but there are other opportunities for community groups looking to establish a profitable community business and using the community shares model is just one method to do so. It could be a community EV charge point, or peer to peer car sharing scheme. Or if an asset is already owned by the community, upgrading to become more carbon-friendly could create long-term sustainability. A recent webinar by the Community Ownership Support Service provides examples of how to do just that.

If you have an idea for a business that will benefit your community and maybe even the environment, Community Shares Scotland, together with our partners the Plunkett Foundation and Co-operative Development Scotland will be hosting an inspirational webinar event on the 24th November. We will have presentations from successful community enterprises as well as a Q&A with our staff so why not register for a ticket and see how community businesses can create fairer, more sustainable and more interesting places to live.

Employee-owned Aquascot accelerates their ambition to become a smart factory

Despite the challenges of Covid-19, Scotland’s largest employee-owned headquartered company, Alness-based sustainable seafood company, Aquascot, succeeded in digitalising production and quality assurance over the last 12 months. In our newest blog we catch up with John Housego, managing director to find out more about the significance of the project and what it will do for the business.

Aquascot’s IT estate of legacy systems had evolved to include lots of manual workarounds, paper-based processes, and difficulty in getting visibility of data. The business was at a crossroads, whether to keep investing in the current systems or look to buy new ones.

“By the end of this year the whole of our IT infrastructure will have completely changed. This offers up a wealth of new opportunities for us, not only with our customers but our business tracking and awareness, and product positioning. In a highly competitive market, we will have the data to be able to focus on improvements and then meet the need.”

Working with partners, FluidIT, the benefits the project will bring include:

  • Production areas are paper-free, and Quality Assurance is fully digitalised with a new quality assurance management system, Q-Pulse. This technology enables Aquascot to continue improving their throughput, quality and consistency.
  • The commercial data dashboards with PowerBI show actual-versus-forecast sales / orders in real time. As a result, time spent on manually processing and reporting is significantly reduced.
  • Aquascot has also selected a new ERP/ MES system from software provider SI (Systems Integration), which will be implemented within the next three months, and will make the capture of shop-floor data easier. Another benefit from the new system is traceability – knowing exactly where each product was farmed, when it was processed and how long for. This information needs to be readily accessible, as food safety governing bodies can carry out spot checks at random.
  • Microsoft 365 is fully implemented across the organisation, including a communication portal using SharePoint, which partners have christened ‘AquaSpace’. IT champions were chosen within each department to receive training on the portal – so they can take ownership to post news articles, events and opportunities on behalf of their colleagues, while all partners have the capacity to interact on the SharePoint through a Yammer social media feed.

The business now has a digital roadmap, setting out a step-by-step process to achieve full digital transformation, over the next three to five years. This innovative approach will ensure Aquascot remains one of the UK’s major seafood processors and pushes them further towards their goal of becoming carbon neutral by 2030.

To find out more about Aquascot and their story please visit their website: https://aquascot.com/latest-news

Are you thinking of selling your business?

Employee ownership specialist adviser Glen Dott shares why succession planning should be dealt with sooner rather than later and shares details on a series on upcoming succession masterclasses. 

Planning for succession is one of the biggest challenges a business owner will face. When you’ve worked hard to build up your business, what do you do when it comes time to stop? Whether you’re looking to hand over the reins of your business soon or simply planning for the long-term, make sure you explore all the available options in advance to allow time for plans to be properly drawn up. Giving the topic early consideration can mean better results for the employer, the employees and the business. 

Succession options to consider include: 

  • Sale to another shareholder 
  • Company buy-back 
  • Ownership transfer within the family 
  • Employee buyout 
  • Management buyout 
  • Trade sale 
  • Flotation 

Employee buyouts are becoming an increasingly popular succession option in Scotland. Being employee-owned gives staff a meaningful stake in the business, boosting productivity and performance, whilst ensuring the company is anchored in the local area, retaining jobs and skills. For business owners, employee ownership offers a tax efficient exit route that protects a company’s legacy while providing a competitive price for the business.   

To help you decide whether an employee buyout could work for you, Co-operative Development Scotland will be hosting a series of five ‘Selling your Business’ online masterclasses over the coming months, exploring succession options including employee ownership.  

If you are a business owner considering an exit from your company, these masterclasses are an excellent opportunity to hear from succession and employee ownership specialists, as well as employee-owned companies themselves. View the full here

Community Business: Making it easy- New video guide available

The community business sector in Scotland is growing and, to support this, Co-operative Development Scotland (CDS) is working in partnership with Community Shares Scotland (CSS) and the Plunkett Foundation to raise awareness and improve access to support.  The partnership has just launched a new video guide which introduces the subject of community business – so we caught up with our co-ops specialist, Jaye Martin, to find out more about the sector, the support available and why now is a key moment for community business in Scotland.

CDS has always supported community businesses and we have consistently seen interest from clients in this area but there has been a change of pace most noticeably in the last 12 months. Two key reasons for this are firstly, the ecosystem in Scotland has evolved with organisations like CDS, CSS and the Plunkett Foundation raising awareness of the benefits and providing support and advice.   Secondly, the pandemic has shone a light on how we do businesses and created a desire for change.  Everyone, particularly those in rural communities, has been very dependent on their local services and now, more than ever, there may be a desire to preserve and develop the resources that are important to those communities.  Community businesses, especially community co-operatives, place democracy and concern for community at the heart of what they do and can provide an alternative way of working that has captured the interest of individuals, communities and businesses.

To improve access to support, CDS, CSS and the Plunkett Foundation offer a collaborative support package to help anyone considering setting up a community business in Scotland. A wide range of advice and practical support is available, including:

  • Choosing the best business model
  • Selecting a suitable legal structure
  • Accessing funding
  • Developing a community share offer
  • Community engagement, including promoting a community share offer
  • Company governance and managing the daily running of your business
  • Specialist support for community business in rural communities

Our new video guide is a great introduction to the subject and the available support.

To find out more about Community Business Making it Easy visit:  https://communitysharesscotland.org.uk/making-it-easy/

Leveraging Ownership event follow up

Last month Scottish Enterprise held a webinar on Leveraging Ownership at which participants gained valuable insights into the evidence underpinning employee ownership and its impact on business performance and employee engagement.

Drawing on practical lessons and experiences from Sheffield-based Gripple and the Basque Country’s Mondragon Corporation, the webinar demonstrated how employee ownership in its different forms can support a pervasive culture of accountability, self-management and employee-driven innovation.

Following on from the event, we asked Dr Peter Totterdill, Director of Workplace Innovation Europe, to write a blog based on the findings from the event including a Q&A with Ed Stubbs, MD of Gripple and James Sallows, Chair of GLIDE, the Employee Ownership Trust that holds shares on behalf of workers at Gripple, about their model of employee ownership.

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Aberdeen IT firm marks tenth birthday with employee ownership transition

North East IT provider ITWORX has announced its transition to employee ownership, with 17 staff given a stake in the business.

Established in 2010 by Philip Mowatt and Jill Ross, ITWORX provides tailored IT and communications services and solutions to a range of clients. The firm is headquartered in Aberdeen and has recently expanded into Dundee and Angus, however many of its clients have a global footprint. With 50 years of combined experience, a host of prestigious awards, and a customer retention rate of 98%, ITWORX prides itself on providing an exceptional quality of service. Last year, the firm turned over £2.6m.

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Reset and Rebuild video

As part of our Reset and Rebuild campaign, we have created a video featuring a wide range of experts on inclusive business models, including Darah Zahran, Sarah Deas, Jaye Martin and Carole Leslie, as well as the businesses themselves such as The Community Carrot, Merlin ERD and the John Lewis Partnership, discussing why they think the models can help rebuild the economy post-Covid-19 and help create a stronger, fairer and more democratic economy.

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Can inclusive business models help us achieve a stronger and fairer economy in a post-pandemic world?

Head of Co-operative Development Scotland Clare Alexander explores further.

Along with the Scottish Government, we want to help create a more progressive Scottish economy that contributes to increased prosperity and equity, creating better opportunities for everyone and spreading the benefits of economic success more evenly. COVID-19, with its proven ability to target and highlight inequality, has made this a more urgent task.

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Employee Ownership Explained – Making Employee Ownership Work

The final webinar in the Employee Ownership Explained series took place on Wednesday 18 November. This month, the focus was on ‘Making Employee Ownership Work’. Having worked in the employee ownership sector for 16 years and supported over 60 companies move into an employee ownership structure, Carole Leslie of Ownership Associates, talked through the process of moving to an employee-owned structure, and how to achieve the best outcome for the sellers, the employees and the business.

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Tangram becomes employee-owned

Edinburgh-based contemporary furniture and interior design company Tangram Furnishers Limited has announced its transition to employee ownership.

The company, which operates from a showroom and office in Edinburgh city centre, specialises in the premium end of the market and works with clients, designers and architects to specify and supply contemporary furniture, lighting, blinds and rugs.  Its wide variety of projects includes work for both private individuals and commercial sites such as restaurants, offices and museums.

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Employee Ownership Explained – The Role of the Legal Adviser in the EOT Transaction

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The latest webinar in the Employee Ownership Explained series took place on Wednesday 21 September. This month, the focus was on the role of the legal adviser in employee ownership transactions. Having worked on a number of these transactions himself, Bruce Farquhar of Anderson Strathern gave an insightful overview of the process from a legal adviser’s perspective.

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New campaign to showcase the role inclusive business models can play in the recovery of the economy launched

CDS Inclusive Model Businesses

We’ve launched a new campaign to showcase the role inclusive business models can play in supporting the Scottish Government with its aim to create a fairer, stronger and more democratic economy, particularly following the COVID-19 pandemic.

To launch the campaign we commissioned a new survey which revealed that half of Scots (48%) agree the pandemic has provided an opportunity to make Scotland’s economy stronger and fairer, with under 35 year olds more even more likely to agree (59%).  64% also said that the pandemic has already made their business more socially responsible.

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Shore becomes employee-owned

Scotland’s largest product design company Shore has become employee-owned, with over 30 members of staff given a stake in the business.

The company, which operates from Leith in Edinburgh, designs, engineers and develops class-leading drug delivery products, diagnostic devices and medical training products. It has a huge global customer base with over 80% of its customers in the USA, EU, Switzerland and Japan.  Its clients include some of the world’s biggest medical and pharmaceutical companies such as Johnson & Johnson, Amgen, Smith & Nephew, Eli Lilly and Ypsomed.

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Community Owned Businesses – The Journey

There is growing recognition of the value of community businesses, preserving community assets and generating economic value for their communities. COVID-19 has clearly demonstrated the importance of supporting communities to be innovative and take the step towards generating wealth locally, avoiding the return to normal economics.

Community imageIn partnership with the Plunkett Foundation, and Community Shares Scotland, Co-operative Development Scotland ran their second Community Business: Making it Easy event this month providing key insight to the realities of establishing a community business and information about the support available.

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Employee Ownership is the way forward for civil engineering consultancy MHB

Civil engineering firm MHB Consultants has become employee-owned, with 40 members of staff given a stake in the business.

Founded by managing director Hendrie Barbour in 2006, MHB Consultants is an engineering design consultancy specialising in bridge design, civil and geotechnical engineering, temporary works and land surveying. Together with fellow directors Fergus Aitchison and Alistair Gray, Hendrie has grown the firm organically to 40 staff, with headquarters in Glasgow and regional offices in Edinburgh and York. Clients include construction firms, transport agencies, local authorities, engineering consultants and private clients throughout the UK.

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