The REWE Group was formed in 1927, following the merger of 17 purchasing cooperatives, and has been based on the cooperative model since day one. From the very start, independent retailers have played a significant role in shaping REWE’s success. Now, as then, REWE’s guiding principles remain rooted in its cooperative heritage. Independent retail is a mainstay of REWE’s culture.
When it comes to cooperatives, Germany leads the way in Europe, and the REWE Group is not just the oldest but also one of the most successful and largest cooperative groups of them all. This is evidenced by our 1,800 active retailers, who are together organised into five regional REWE cooperatives and operate around 2,300 REWE and nahkauf supermarkets in Germany, with more on the horizon. REWE’s ongoing development is informed by the knowledge and experience of a 300-strong team of specialist retailers (TEK).
The five regional cooperatives, together with FürSie eG, are the shareholders of the parent company, REWE-ZENTRALFIANZ eG. As such, these independent retailers have a say in the essential opinion-forming processes of the REWE Group, either directly or through elected representatives, an essential feature of cooperatives.
Independent retailers are building the heart of our cooperative. They benefit from all that the organisation has to offer while also having the opportunity to have their say in the running of the organisation, be it through governing bodies or through the operational and strategic integration structure that has shaped the cooperation between retailers and the REWE organisation for years. Implemented in this way, the cooperative model is ahead of its time. No other business model enables such a high degree of individual responsibility combined with considerable dynamism and cooperation between everyone involved.
Unlike publicly traded companies, a cooperative has a duty, first and foremost, to itself and its members. This enables a high level of stability and a focus on the essentials in the interests of the cooperative and its members.
A corporate culture that is characterised by trust and where positive, yet challenging cooperation between shareholders and management plays a special role, contributes to a positive, future-oriented development of the organisation. At the same time, however, the cooperative structure is also designed on a fundamental level to afford a high degree of responsibility for each and every individual and the entire organisation.
One of the cooperative movement’s most knowledgeable experts is Thomas Nonn, Executive Board Member for Independent Retail and Cooperative. He represents the interests of independent retailers both within the group and at national and European levels. In this interview, he explains why cooperatives are the best business model and what opportunities the REWE Group offers to business owners.
Thomas Nonn: The cooperative model has always been ahead of its time. Choosing a business model that supports independent entrepreneurship demonstrates a high degree of responsibility. Many of the movement’s ideas have always been and will continue to be relevant. Sustainability, for instance, is in the cooperative movement’s DNA. Independent livelihoods that are maintained from generation to generation.
So there is no need for cooperatives to hide behind capital market-oriented companies?
Thomas Nonn: On the contrary, when compared to capital market-oriented companies, cooperatives are the better option because they fulfil an important social mission. This applies not only to the banking, agriculture and retail sectors, but also particularly to the German housing market. In Germany, around 2.2 million properties are let out by cooperative housing associations on terms that are not available on the open market. A further advantage is that cooperatives are democratically managed and regulated. As owners, the members have their say on all the key matters and harness their expertise to shape to the future development of the business, as aspect that is unique to the cooperative business model.
Thomas Nonn: Our retailers are the heart of our cooperative; they benefit from all that the organisation has to offer while participating actively at the same time. As members of regional cooperatives, the retailers are involved in the key opinion-forming processes, either directly or through elected representatives. Some retailers contribute their experience and expertise as managers in the sales regions and are involved in the decision-making process. This ensures that the retailer perspective is incorporated into each transformation process, resulting in the best outcome for everyone.
Doesn’t this make it difficult to reach strategic decisions?
Thomas Nonn: No. Because, when it comes to strategic decision-making, the management and shareholders are not accountable to anyone else, which allows them to take a stable, long-term approach without the need to respond to every little distraction along the way. That is a definite advantage. Alongside the necessary focus on economic success, the management can also promote other values, such as mutual trust and constructive collaboration. This can be seen in the retailers who share their experience and expertise over many decades as part of the specialist retailers’ team and the strategic committee meetings (SAS), which give retailers and management a platform for regular discussion at the regional and national level.
Thomas Nonn: We receive a lot of applications, but the biggest challenge comes in matching a suitable candidate to a location. We therefore look favourably on those who are able to relocate. The amount of preparation required before becoming one of our independent retailers is an additional obstacle that can be frequently underestimated. We devise a tailored training plan for each applicant which varies in length and focus according to the individual’s prior knowledge and experience. If you would like to find out more, visit the REWE careers site (https://karriere.rewe.de/selbststaendig) for further details and information about the different cooperative models.
Thomas Nonn:
My roles complement each other perfectly because, ultimately, everything I do is about establishing frameworks to ensure that independent retailers are supported by their organisations and can be as successful as possible. As president of Independent Retail Europe, I have the same aims as in my other roles: to do everything I can to establish the frameworks that will enable cooperatives and their members to achieve success in their business. Correcting misguided perceptions in the political and public spheres and promoting a better understanding of the work of cooperative business models in retail are both crucially important aspects of my role.
The REWE Local Partnership is a case in point. This sees our REWE retailers voluntarily committing to abide by guidelines promoting sustainable collaboration with local producers and suppliers. Retailers and producers have cooperated on equal terms for many years. It would have been unnecessary to introduce additional legal regulation against unfair trading practices in this instance because the Local Partnership has long provided farmers with a high degree of certainty and security in respect of order volumes, marketing and pricing.
From the very start, independent retailers have played a significant role in shaping REWE’s success. The REWE Group was formed in 1927 following the merger of 17 purchasing cooperatives and has therefore been based on the cooperative model since day one. Now as then, REWE’s guiding principles are influenced by this heritage. Independent retail is a mainstay of REWE’s culture.
Independent Retail Europe is a European umbrella organisation for groups of independent retailers in the food and non-food sectors. Its members are independent retail groups, independent retail associations and service organisations, including Conad, Edeka, Euronics, Expert, FCA, ICA, Intersport, Markant, REWE, Système U and Spar. In total, Independent Retail Europe represents more than 386,000 retailers.
Executive Board Member for Independent Retail and Cooperative Germany
Executive Board Member Thomas Nonn heads up the REWE Group’s Independent Retail division.
He was one of the architects of the ‘REWEformer’ project, which refocused attention onto REWE’s independent retailers and pushed for their involvement in decision-making processes. At cooperative association level, Nonn is also actively involved in the committee of the Mittelstandsverbund – ZGV e.V.
In addition, he has been the president of Independent Retail Europe since 2019. He is also a member of the council and board of directors of the DGRV (German Cooperative Confederation) and is active on the board of the Centre for Research into the Cooperative Movement at the University of Cologne and the governing body of the ADG (Academy of German Cooperatives) in Montabaur. Nonn is also on the board of the German Friedrich Wilhelm Raiffeisen Society.
The cooperative model has always been ahead of its time. Choosing a business model that supports independent entrepreneurship demonstrates a high degree of responsibility.
