26 May 2009

Member Visit: Suma

Last week I visited Suma Wholefoods, to talk about measuring and reporting business performance within worker co-operatives. Suma is largest worker co-operatives in the UK. wholesale and distribution business with 120 employees and turnover of £24.7 million. They have grown year on year and operate a successful business in a very competitive industry.

How do they do it?
Suma has grown and therefore needed to evolve over they years but some of the core features setting it apart seem to be: democratic management structure, flexible multi-skilled workforce, equal pay and profit distribution, common ownership and a clear set of principles guiding their business.

Democratic Management Structure
Major strategy and policy decision are decided at general meetings of the full membership, roughly 6 a year. Members once a year elect representatives to sit on a management committee (MC), which is given authority to implement the plans and make recommendations to the general membership. Suma is organised into functional areas (Drivers, Warehouse, Buyers etc) and representatives from the these areas meet weekly to manage operational issues and work in partnership with the MC to organise Suma business operations .

Multi-skilled workforce
Suma members are actively encouraged to rotate jobs and skill up in different areas of the business. This helps to smooth over personnel demands in peak periods and also means decision making can be more informed with members knowing the impact of decision in different areas of the business. It does however have issues, with the need for more complicated staff scheduling systems and individual performance measuring.

Equal pay and profit distribution
All Suma members are paid the same net daily rate irrespective of role, full time member this amounts to £18,500 a year in hand plus bonuses. As a member owned business Suma does not have outside shareholders to satisfy and therefore distributes any surplus between members on an equal basis pro rate for the days they work for the co-op (in line with co-operative principles).

Commonly Owned Co-operative
Suma is common ownership business which means the business is safe from hostile take over or members selling the business for individual gain. Current members can use the assets built up by past members and hold them in trust for future members. This has secured Suma's independence and frees them to invest in the business for the long term.

Actively Managed business
25 years ago Suma members decided to run the business to deliver the wages they wanted. Suma's annual business planning is aggressively managed to ensure this and to deliver a Christmas bonus each year. Bob says " It took us a while to work out how to actively manage the business but our performance is pretty consistent these days and we can adapt to changing market conditions pretty well."