ICOF – The Borrowers Point of View

Through this, our fiftieth year, we’re delighted to be talking to some of the incredible people who have worked with us along the way – borrowers, supporters, investors, partners, Trustees, and staff.

Here we share The Borrower’s Point of View, in this piece written twenty five years ago by Martin Meteyard, who was a member of GreenCity Wholefoods co-operative from January 1983 till November 1997, when he left to become Chief Administration Officer of CWS Scottish Co-op.

‘GreenCity Wholefoods was registered as a common ownership worker co-operative almost twenty years ago: on 6 June 1978, to be precise. The actual name registered was a real mouthful – Scottish Wholefoods Collective Warehouse (Grassroots) Limited – but has never been used apart from the legal requirement for it to appear on letterheads. Somehow it doesn’t have quite the same ring about it as GreenCity!

GreenCity and ICOF have been more or less inseparable from the start. Although the co-operative operated out of the initial members’ front room for the first few weeks, suitable premises of 5,000 sq ft were soon located on the Hillington Industrial Estate to the west of Glasgow. A business was being born. It needed money. And while the co-operative members and the bank glared at each other in mutual incomprehension, ICOF stepped in and provided the necessary funds.

Things looked rosy in 1978. Less so a couple of years later. It’s one thing to run a shop (Grassroots, from whence the original GreenCity members came), quite another to manage a burgeoning wholesale business. Energy, hard work and long hours couldn’t quite compensate for a lack of skills. The gross margin slumped, and small profit became large loss. Was the game up already?

Somehow the ICOF Trustees, rather than pulling the plug, had faith that the co-op members would learn from their mistakes. A repayment holiday was declared, and the loan topped back up to its original level. Slowly but steadily,

GreenCity crawled back into surplus once more. But business is nothing if not a series of ups and downs. The wholefood business was booming by the early 1980s, and so was GreenCity’s turnover – on a tiny capital base. The Hillington warehouse, which initially seemed so huge, was now overflowing into rented containers with jury-rigged lighting. By 1983, it was time to move; another step into the unknown.

Huge new premises (a former Pickford’s furniture depository) were found in the east end of Glasgow. The rent was the same whether we took part of it or all of it – so we took all of it! While most of us carried on selling wholefoods, a small crew became expert in bricklaying, joinery, painting and decorating over at Fleming Street. We finally moved in over a weekend in October 1983; and just a week or two later, were abandoned by two of the four founder members (including the one who’d always fronted for the co-op in negotiating loans, etc.). Time for a quick learning curve – not least on the part of yours truly.

1984 lived up to its associations. It was a nightmare. Money became tighter and tighter (not helped by the fact that we had a 20-year lease on our old premises, and it took nine months to persuade the landlords – the Scottish Development Agency – that making us pay two lots of rent wasn’t a contribution to supporting small business). The excuses for not having stock of basic items became thinner and thinner. Most businesses would have called it a day.

But we were a co-op; we had energy, plans, a vision. Slowly we put together a business plan which showed that we could climb out of this mess if only we could borrow £30,000 from somewhere. Somehow we acquired the negotiating skills (with a little help from some friends) to interest our bank, the local council – and ICOF. No-one wanted to commit first, of course, but guess who did in the end?

ICOF only got one thing wrong. It was a condition of their loan that we stay out of what we saw as a potential growth area in herbs and spices; but we went ahead anyway and have always made a tidy profit from these lines. Even ICOF can’t win ‘em all!

With the aid of this funding, things went very well for a while – until we faced the challenge of information technology. For a while we coped with the help of two Amstrad PCWs (I’m still proud of the spreadsheet I developed for pricing and valuing stock!). But we knew we needed something bigger and better, and we knew it was going to cost us a lot of money.

Time for another business plan, time for another approach to ICOF to help with the funding package. After all, we’d almost paid off the previous loan by 1990 – and where would ICOF be without a loan to GreenCity? The package slowly came together, apart from £5,000 from one lender who imposed a series of conditions and then turned out not to have the money to lend anyway. So who put in an extra £5,000 on top of their previous commitment? You guessed!

So we bought the new computer system; and it nearly did for us. It was the same old co-op problem: loads of enthusiasm, but a distinct lack of skills. Fortunately a self-taught genius came along in the nick of time, and we slowly started to reap the benefits of computerisation – but that’s another story. Meanwhile the recession wasn’t doing us any favours, either, but we struggled on. We even managed to keep up our ICOF loan repayments, so it can’t have been all bad.

Then our major competitor in Scotland went bust, and things suddenly started to look up. Another long running saga (which began in 1988) entered its final chapter as we finally got the opportunity to purchase our premises after years of litigation. It’s 1996; and, oh no, suddenly we’ve paid off ICOF in full. What on earth will we do now?

It was obvious, really. We went back to ICOF for another loan. We needed money to buy the premises, to upgrade the computer system (which had suddenly become terribly slow), and the ICOF contribution was as usual a key part of the package. And because GreenCity and ICOF have become so close over the years, it was actually pretty painless as well.

Congratulations on reaching your 25th anniversary, ICOF. GreenCity is proud to have been in your debt for most of that time!’

We are pleased to say that since this piece was written, our relationship with GreenCity Wholefoods has continued. In 2001, they took a loan to convert one of two unoccupied floors of their existing building into studio spaces to rent. Then, in 2006 another loan enabled them to convert the second of the two floors to artist and office studio space allowing them to further diversify their income. At the time there appeared to be no shortage of demand for this kind of space in Glasgow.

GreenCity Wholefoods have been model borrowers, repaying to schedule, supplying regular management information and networking with other ICOF borrowers. And they provided this great photo of the whole Green City Team. Always happy to work with you, Green City!