BUSINESS/COMMUNITY
It’s 5.30am on a cold winter Saturday and Paddy’s Markets at Flemington, a fruit and vegetable market in western Sydney, has been buzzing for hours. Trolleys weave through shoppers bargaining with cash in hand and traders shouting their prices. Josh Blythe and his son Chris have arrived with a mammoth task. “We are here to feed 12 families for the next week with a bunch of fruit and veggies,” the co-founder of Killarney Heights Fruit Co-op tells the ABC’s The Business.
Blythe’s co-op is a voluntary bulking buying community group. Each household devotes three to four hours of their time once every three months to do the shopping. The budget is $20 per household for a box of fresh produce that lasts for a week. “We generally get higher volume, lower costs and better quality than some of the major supermarkets,” he says.
They take the food home and divide it up before it’s collected by the other households.
The goal is to save money on groceries. “If we had to do that in the [major] supermarkets, it would probably be about $60 a week,” Blythe says. “We’re probably saving two-thirds on our weekly grocery bill just for the fruit and veggies.”
Market vendor Frankie Schipirra, whose family has been in the fruit and vegetable business for decades, said he’s seen an influx of small informal co-ops at Paddy’s due to cost-of-living pressures over the past six to 12 months. “A lot more families getting together, and neighbours getting together to buy a box of this and a box of that and share it,” he says. “You come down to Paddy’s and you cut out the middleman, you can get stuff that comes direct from the wholesaler or the grower at a reasonable price.”
While Blythe’s co-op is informal, some have set up as profit-sharing enterprises or non-profit organisations offering membership to the public.
“When we think of companies, we often think of shareholder companies,” says Melina Morrison, CEO of the Business Council of Cooperatives and Mutuals. “When we think of cooperatives, we need to think of a different type of owner, the owner is the user of the business.”
Morrison notes these cooperative structures allow people to pool their purchasing power in the face of cost-of-living pressures. “It makes absolute sense to cooperate when you’re trying to solve a need you all share and that’s what co-ops are formed to do.” She adds that the purpose of a co-op is to deliver benefits to members, rather than maximising profits and returns to investors.
In Australia, there are a broad range of co-ops, including banking, insurance, agriculture, motoring and retail. According to the Business Council of Cooperatives and Mutuals, 8 in 10 Australians are members of at least one co-operatively owned business. Cooperatives, including member-owned super funds, account for about 8.3 per cent of GDP.
A co-op supermarket is different to the major supermarkets. For instance, in the Barossa Valley in South Australia, 90% of the local population shops at Barossa Co-op; there’s no Coles or Woolworths in the area. It’s Australia’s largest and longest-standing retail co-op, established back in 1944 as a general store. It now runs a supermarket and services for 23,000 members.
CEO Cathy Main says the way they handle their profits differentiates the co-op from major supermarkets because their profits are returned to the community through sponsorships and price discounts. “It feeds into the cooperative ethos of working together, cooperation, collaboration, to be a self-reliant community in controlling its economic and lifestyle future,” she says. “Last year, we provided just under $500,000 worth of discounts in Barossa Fresh supermarket alone, with fuel discounts included.” She adds members enjoy cheaper prices but also retain a say in how the co-op is run through voting rights.
Australia’s supermarket sector is highly concentrated, with Woolworths and Coles controlling two-thirds of the market; less than 1% of the sector are co-op supermarkets. However, in countries such as Switzerland (70%), Germany (46.5%) and France (35.8%), co-op supermarkets account for a big chunk of the market.
ABOVE Josh and Chris Blythe say shopping at the markets
PHOTO ABC News/John Gunn
If we had to do that [shop] in the [major] supermarkets, it would probably be about $60* a week. We’re probably saving two-thirds on our weekly grocery bill just for the fruit and veggies.
*They spend just $20 a week!
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