Co-ops add billions to economy
New Zealand’s top 30 co-operatives contribute more than $42.3 billion per annum to the economy in revenue, a report has found.
The report, by industry body Cooperative Business NZ and researchers from Massey University and Auckland University, shows the top co-operatives and mutuals have a revenue-to-gross domestic product ratio of 17.5 per cent.
The data “confirms the importance of the co-operative business model to New Zealand as a country”, said Cooperative Business chief executive Craig Presland. A total of 1.4 million New Zealanders are co-op members.
Led by dairy giant Fonterra, the agri-food sector generates 65.2 per cent of that revenue, holds 67.6 per cent of assets and employs 82.8 per cent of the 48,500 people employed by co-ops. Fonterra alone has revenue of $18.8b. It is followed by the two regional Foodstuffs co-ops and Silver Fern Farms.
The next largest sector by revenue is retail and wholesale, accounting for 30.3 per cent of the revenue.
When the authors of the report compared New Zealand to other countries they found the agri-food and retail and wholesale sector account for twice as much of NZ’s cooperative economy compared to the top 300 in the world and three times that of Australia’s top 100 cooperatives.
“We expected the agri-foods sector would be important but we were surprised to find it is twice as much as the global situation,” said lead researcher Elena Garnevska of Massey University.
The reverse was true for the insurance, banking and finance sectors. Globally, the sector accounts for 45 per cent of revenue in the co-op economy but in New Zealand, it is only 3.4 per cent.
Given the importance of co-ops to the economy, the authors are calling for more research to look at the sustainability of the model and map long-term trends.