Suma (co-operative) - Cluster Strategy

Cluster Strategy

Suma became the hub of a cluster of spin-off co-operatives in the food sector including Beano Wholefoods (a retailer in Leeds), Hebden Water Milling Collective (which mixed and packaged food and produced nut butters) and Cena (a research co-op). It was a major customer of the Wharf Street Café and collaborated with Leeds Beer Co-operative (the Ale House). It became a significant motor of co-operative creations, and established a co-operative development loan fund. For a period of several years in the 1980s, each time members decided to increase the pay rate, the same amount was put into the co-operative development fund.

Suma was in a leading position in the very fast-growing market for health food in the mid to late 1990s, and was conscious of immense growth opportunities. However the preferred method of expansion was based on the creation of independent co-operative businesses, rather than a more co-ordinated strategy. Suma therefore deliberately devolved several of its regional markets, such as Scotland and the Midlands, to other newly founded co-operative wholesalers (Green City Wholefoods and Ouroboros respectively). In 1989 a study was carried out on the creation of a nationwide co-operative wholefood group, including the above along with the sizeable Nova in Bristol, under the provisional name of NOW - Network of Wholefoods. However Suma, with roughly half the sales of the putative combined group, felt it had more to lose than to gain, and preferred to continue alone. The cluster of businesses grew more slowly than the market as a whole, and the movement steadily lost market share. Suma has partially redressed this by launching its own branded goods.