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Last Updated: Tuesday, 29 August 2006, 10:17 GMT 11:17 UK
The return of the 'divi'
By Sean Coughlan
BBC News Magazine

In the Co-op's heyday there were 13 million members

Long before the supermarket loyalty card, there was the profit-sharing Co-op "divi". Now it's back.

A piece of shopping folklore is being revived by the Co-operative Group with the return of the "divi" - the slice of annual profits paid out to members. It is a return to radical roots for a group whose history is bound up with that of the labour movement.

If the divi had an old-fashioned flat-cap image, this revived scheme will be targeting the fashionable ethical shopping market. And the sales pitch will be about "values and principles" rather than bargain hunting.

The re-launched dividend will see the group - which has annual sales worth 8bn from its shops, travel agencies, chemists, insurance and banking - offering membership for 1. The new-look divi will be paid out on mortgages as well as goods from the meat counter.

As well as receiving a dividend, the members will be able to vote and take part in the organisation - which has increasingly emphasised its ethical policies and radical roots.

This hasn't just been an exercise in altruism. The Co-operative bank says much of its new business is driven by its ethical stance, such as refusing to invest in the arms industry or tobacco firms.

No-one is going to get spectacularly rich from the dividend. It will vary according to profits, but the Co-op sketches out a scenario where members might expect to receive 10 for every 1,000 spent, with payments made twice a year.

Consumer politics

But it highlights the growing cross-over between consumerism and campaigning, which has seen retailers filling their aisles with products aimed at satisfying consciences as well as pockets.

Free-range eggs and fair trade coffee are now mainstream products. And ethical spending has exceeded 25bn per year, the New Economics Foundation has calculated.

Membership card
Membership will give voting rights

With the current profit-sharing plan and its ethical trading policy, the group has a target of gaining four million members by the end of the decade.

Nonetheless, even if this is achieved it will be a long way from the power that the Co-op once wielded in the high street. In the 1950s, the Co-op accounted for a fifth of all food spending, with 13 million members and 30,000 shops.

These shoppers regularly queued up to collect their "divi" - in a system of profit-sharing devised by the Co-op's founders in 19th Century Lancashire.

Long before the current fashion for green products and fair trade, this linked shopping with social reform - and was part of the developing labour movement. And the political offspring, the Co-operative Party, still has 29 MPs on the Labour benches.

The previous version of the dividend faded out in the 1970s, to be replaced by stamps, which too disappeared. And although there have been local co-ops continuing with loyalty-card type schemes, this marks a partial return to a very long tradition.

Add your comments on this story, using the form below.

Locally, the Co-op sold its store to Asda/Walmart. Far from returning profits to members, the store now returns profits to America. Very ethical.
Carina Stevens, Peterhead

I worked at a Co-op store on and off during uni. My Mum still manages one. From an insiders view this will only annoy staff who often feel under-trained, misled, and are expected to do far more such as paint the outside of the shop then is written in their job description.

The money focused on this project should have been focused on improving the physical aspects of stores and staff training to provide a better customer experience
Kieranties, Bristol

I'm nearly 60 and can still remember my parents divi number - will I still be able to use it?
Tony, Horsham

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