For the most part, the staple diet of the working classes and much of the lower middle classes in the mid nineteenth-century consisted of bread or potatoes, a little bit of butter, cheese or bacon, tea with sugar, and a bit of salt. The eighteenth century had shown forward-looking retailers that profits could be made by selling in quantity to the mass market at a small mark-up. The improvements to transport and the consequent development of wholesalers and distribution centres, and the concentration of population in urban centres, soon made the idea of selling a small range of stock items—bought in bulk, for low prices—both practical and astonishingly profitable.
In the early 1790s, before the French wars, wheat had cost between 48s. and 58s. a quarter; by 1795 it was 90s.; and in 1800 it was a shocking 113s.—an increase of 135 per cent in less than a decade. There was an endless succession of food riots: more than twenty between 1756 and 1818, and a dozen of those in the last two decades. There were also attempts throughout this period to find more peaceful ways of dealing with the price escalation. One solution was to turn to the social group that was so familiar—the club. Groups of consumers joined together in flour or bread societies to gain the financial clout to buy these necessities at reduced prices. Many of the societies failed, mostly from inadequate investment or size. But one of the more successful was the Birmingham Flour and Bread Company, set up in 1796 with capital of £6,000 from its members, because ‘unless some proper and effectual means are taken, the evil attending the high price of grain and the shameful adulteration of flour will continue’. By 1800 it had 1,360 shareholders (including Matthew Boulton). Others groups followed suit, using what became the standard methods: large-scale orders, paid for in cash, with discounts for bulk.4 And in the early decades of the nineteenth century there were still other groups, more idealistic in origin, set up in emulation of the principles of the socialist reformer Robert Owen. In 1827 the Brighton Co-operative Benevolent Association and the Co-operative Trading Association were formed, to collect weekly subscriptions which were to be used both to educate people in the values of cooperation, and to ‘engage in retail trade with the object of accumulating capital from its profits to eventually establish a community’ based on cooperative principles.5 William King, a doctor, was the prime mover, having already set up a Mechanics’ Institute in Brighton; he also published The Cooperator, a paper with a good circulation in the north and the Midlands, which strongly influenced the later Co-op movement.
An early Co-operative Congress met in Manchester in 1831, to establish the North-West of England United Co-operative Co., to supply a wholesale warehouse in Liverpool for the various societies’. This did not take off, but these early cooperative ventures set an example, and in the 1850s and 1860s a new generation of workers attempted to create similar societies. The town of Rochdale, in Lancashire, was the location. Rochdale had had a thriving flannel industry for centuries, but with the coming of power looms the economic life of the town was no longer so stable. The new industries of coal mining, cotton mills and machine-making were developing, but the ‘hungry forties’ and reliance in the new factories on hiring ‘outsiders’ combined to create extreme hardship locally. In 1837, 180 animals a week had been slaughtered for sale in the local market; in 1841 the number was less than 70. So in 1844 the Rochdale Pioneers was formed, a club with thirty members, set up with the intention, in the short term, of selling food and clothing at prices workers could afford; then, when it became possible, the group hoped to move on to building workers’ housing, creating their own workshops, and setting up a temperance hotel. The main difference between the Pioneers and other clubs was that profits would no longer simply be divided among the members. Now interest would be paid to each shareholder, and what remained of the profits would be distributed to members in proportion to the amount of money they had spent at the store that year: a dividend on purchases. With capital of £28, the Pioneers began trading with a stock valued at £16 11s. 11d.: 28 pounds of butter, 56 pounds of sugar, 6 hundredweight of flour, 1 sack of oatmeal, and some candles. At the end of its first year, the club’s membership had risen to seventy-four, it had increased its working capital to £181, and had made a profit of £22. The trade depression of 1847 only brought in more members: by 1848 there were 140; two years later it was 600.
In 1850 another group of men in Rochdale attempted to start a cooperative corn mill, in imitation of the Pioneers. When they failed to raise the necessary capital, they approached the Pioneers themselves, who invested some of their profits in the mill, creating the Corn Mill Society. By 1852 twenty-two different societies were dealing with the Corn Mill Society, a consumer-initiated, consumer-owned and consumer-controlled group. By 1851 there were perhaps as many as 130 societies working on the principles the Rochdale Pioneers had established, and many realized that cooperation between them was the way forward. In 1862 a conference in Oldham agreed to set up the North of England Co-operative Wholesale Agency and Depot Society; the following year it was formally registered as the North of England Cooperative Wholesale Industrial Provident Society (later thankfully shortened to the Co-operative Wholesale Society, known as the CWS), with forty-three societies owning shares. This was the start of the national cooperative movement: in 1862, branches of the Co-op were opened in Newcastle; in 1874 in London; in 1875 in Liverpool, in 1882 in Leeds, then over the next decade in Birmingham, Blackburn, Bristol, Huddersfield, Longton, Northampton, Nottingham and Cardiff. Furthermore, buying depots were set up across the country, and also outside England: six were opened in Ireland in eight years; then one in New York; followed by, in Europe, Rouen, Dénia, Copenhagen, Aarhus, Odense, Esbjerg, Gothenburg and Hamburg, and, further afield, Montreal and Sydney. As if this unstoppable march were not enough, the Co-op opened its own production sources where necessary: a dairy in Ireland from 1889; pig farms and bacon-curing in Denmark from 1900 and Ireland from 1901; even tea estates in Ceylon from 1913.6
By the 1860s the idea of cooperative trading had travelled far from its origins, and various middle-class groups were setting up their own versions. The first was in 1864, when some Post Office clerks in London clubbed together to buy a chest of tea at a wholesale price. They moved on to bulk purchases of coffee and sugar, and in 1865 the Post Office Supply Association was formalized; within six months, it had 700 members, and it had changed its name to the Civil Service Supply Association, whose intention was to supply ‘Officers of the Civil Service and their Friends…at the lowest possible prices’.7 In 1866 came the Civil Service Co-operative Society, and in 1872 the Army and Navy Cooperative Society, open to ‘officers, their widows, non-commissioned officers, petty officers, secretaries of service clubs, canteen and mess reps’, and any friends that they chose to introduce.8