CHAPTER V.. The Branch Controversy.

THE BRANCH CONTROVERSY.

A LENGTHY CONTROVERSY—TO BRANCH OR NOT TO BRANCH?—AN OPTIMISTIC REPORT—LACK OF CAPITAL—STRONG OPPOSITION—BARRHEAD THREATENS WITHDRAWAL—THE QUESTION REOPENED—BARRHEAD DECIDES TO WITHDRAW—SHELVED AGAIN—DISSATISFACTION IN PAISLEY AND JOHNSTONE—BRANCH OPENED IN GLASGOW—THE FINAL DECISION—BARRHEAD, PAISLEY PROVIDENT, AND JOHNSTONE WITHDRAW.

In the preceding chapter we noted that a proposal was made at one of the general meetings of the Society that branch bakeries should be established. It was a proposal which occasioned a great deal of discussion and was the cause of several heated debates during the next few years, and it is therefore important enough to merit a chapter to itself. The idea was first mooted at the quarterly meeting held in December 1871, when Johnstone Society delegates in the course of a general discussion brought forward the suggestion “that the Baking Society should think of the possibility of opening branch establishments as their business extends.” The idea was favourably entertained then; but it was obviously impossible to do anything at the time, and it was not until the quarterly meeting which was held on 30th November 1872, exactly a year later, that anything further was heard of the subject.

At that meeting a general discussion took place “as to the desirability of opening a branch bakery in Paisley or Johnstone.” The matter ultimately dropped for the time being, but it was left with the committees of Johnstone, Paisley Provident, and Paisley Equitable societies “to make inquiries in their respective localities as to a suitable place for the business, which could be rented, leased, or bought, the probable cost, and all other information that may be necessary, and forward the information obtained at as early a date as possible to the committee.” The Johnstone committee were especially enthusiastic about the proposal, and before next quarterly meeting a report was in the hands of the committee. This report was read to the delegates at the next general meeting of the Society, and a general conversation took place in the course of which the opinion was expressed that however desirable it might be that the Society should branch out in the manner indicated, it was inexpedient that it should be done then in view of the state of the Society’s affairs. The committee of Johnstone Society were, therefore, thanked for the trouble they had taken over the business and for the report which they had prepared. It was also agreed that this report be printed and circulated amongst the members of the Federation, and that the subject be brought up at next quarterly meeting.

JOHNSTONE SOCIETY’S REPORT.

The report of the Johnstone Society is so interesting and throws so much light on the affairs of the Federation that it is worthy of being printed in full, as issued in circular form by the Bakery committee.

To the Committee of Management and Delegates representing the United Co-operative Baking Society Limited, Glasgow.

GENTLEMEN,—Having been appointed at your quarterly meeting, held 30th November 1872, to report on the results which would be likely to flow from your Society having a branch bakery in Johnstone, we respectfully beg to offer the following for your consideration.

The advantages which the promoters of your Society saw in having a “united management, a concentration of labour, and a combined purchasing power,” is nearly, if not altogether, neutralised by the high cost of your productive and distributive departments; ten shillings a sack is, we believe, something unknown in Scotland as the cost of baking and distributing common loaf bread, and in your establishment it cannot be set down even at this high rate, as your auditors at last quarterly meeting warned us that the depreciation of your fixed stock was not commensurate to its “tear and wear,” and we believe investigation during the quarter now ended has brought out that your liabilities in direct debts were greater than was accounted for in your balance of October last.

This being the case, it is a duty incumbent on all to examine into and see if anything can be done to remove the obstruction to progress and place the Federation on a sound and stable basis, beneficial alike to individual and to the union of societies.

To do this reforms of more or less consequence may require to be introduced, but the one on which we are commissioned to report, and which appears to us as the most urgent, and the most likely in being effectual in removing the evils complained of, is the setting down of a branch in Johnstone, or some other place, where a great amount of distributive expense could be saved at a small outlay.

The cheapness of carriage of flour in the bulk and its dearness when manufactured into bread, which is at once bulky, fragile, and heavy, suggests readily the idea that it would be well to have branches set down in localities where there is a consumpt of bread large enough to work them successfully; we consider Johnstone a place of this class, and desire to lay before you, in detail, some of the reasons why we think so.

In making Johnstone a district with a branch bakery we would class the following societies together, viz.:—Paisley Provident, Paisley Equitable, Howwood, Elderslie, Kilbarchan, Linwood, and Johnstone. Taking October balance as an average of the bread taken by these different societies, we find in the aggregate that the six societies first named took bread to the value of £892, 10s. 6d., and that Johnstone Society took bread to the amount of £884, 12s. 9d., a total of £1,777, 3s. 3d., or within £100 of being a third of all the purchases made at the Bakery during the quarter. The Johnstone Society’s quantity, £884 a quarter, averages something like sixty-four dozen loaves daily, the outcome of four sacks of flour; say, then, with the other societies named, eight sacks of daily consumpt. The weight of this number of sacks, in the bulk, is one ton (twenty cwt.), and the price of carriage and delivery in Johnstone, from Glasgow, is four shillings. These eight sacks, made into bread in Glasgow, gives a weight, including boards, of over thirty-four cwt.; this is exclusive of vans, which, we believe, are about half as much more, or seventeen cwt. each. In this condition, then, of baked bread it costs your Society thirty shillings or over daily to deliver to the various societies of the named district. Supposing, then, that you had a branch in Johnstone and a more restricted delivery system adopted, we entertain no doubt but one horse and van could overtake the whole three mile radius, give and deliver the required bread to the different societies. The cost of this would be about twelve shillings a day, which would leave a clear profit to the Society of fourteen shillings a day, or £54, 12s. a quarter, nearly £220 a year.

Another View of the Case.

We have had an interview with a practical managing baker, and his estimate of the cost of production is much below your present expense; he considers that the quantity required (eight or nine sacks a day) could be baked into loaves at a cost of three shillings per sack (he laid stress on the fact that the job was loaf baking alone, and said that men were able and really did do more of this kind of work). Buying the flour at the then price of fifty shillings per sack, and adding three shillings for baking, rent, etc., we have a gross cost of fifty-three shillings per sack. The outcome from this quantity of flour should be sixteen dozen small loaves; retailing them at the then price of 4¼d. each, you have the sum of sixty-eight shillings; 10 per cent. less would be sixty-one shillings and twopence, or a profit of eight shillings and twopence on each sack baked and sold; this eight times (a daily output) would give sixty-five shillings and fourpence per day, or £19, 12s. a week, £254, 16s. a quarter. But allowing half this quantity has to be delivered to societies, and say this will cost three shillings per sack, which would give a total cost of about £48, 15s., which sum deducted from the £254, 16s. would still leave the sum of £206 a quarter of a clear profit realised from the business done by the seven societies comprising the proposed district.

Regarding the practical part of the scheme we have nothing to offer in way of a ready-made bakehouse or other suitable premises, and we are afraid that should the business be gone into, as proposed, new premises would require to be got; on this, however, we ask your consideration to the fact that your present premises have not the necessary storage for flour which your large turnover requires. This is attested by the proposal which was made six months ago for alterations, and if it is true, as we believe it is, that properly stored flour is from one to two shillings a bag better in outcome than when used as has hitherto been done at the Bakery, one shilling on each sack baked for a quarter, say 1,800 sacks, and you have a sum of £90.

The alterations which were proposed and were estimated to cost about £200 have never been carried into effect, consequently the Bakery labours under the disadvantage of want of storage at a loss equal to something like £90 a quarter.

We know full well the high cost of distribution, and some are sanguine the productive cost could also be lessened; could not this sum, then, of £200, or say £300, required for storage purposes be laid out on a branch bakery in the Johnstone district, and take away a third of the trade from the centre; you would then have storage to suit your requirements for some time to come, very probably you would be less for productive expenses, and most certainly your cost of distribution would be so much curtailed as to release the Federation from the incubus which at present keeps her down.

Gentlemen, our aim and earnest desire is the prosperity of the Federation and its component parts; we lay these considerations before you and leave the matter in your hands, being confident your united wisdom will be well able to direct the path which will earliest and best lead to better and happier times for the United Co-operative Baking Society.

THE JOHNSTONE SOCIETY’S COMMITTEE.

Johnstone, 21st February 1873.

At that time it would seem that the representatives of all the societies were enamoured with the idea of branching out, especially in view of the very rosy picture which had been presented in the Johnstone Society’s report, but they realised that at the moment branching out was impossible. The Federation’s commitments in capital expenditure were already as much as could be borne; the cost of building a new bakery would add considerably to the burden, and neither delegates nor directors could see how it could be carried; so, when the subject was brought up again at the June quarterly meeting, it was left in the hands of the committee, with the proviso that no extension take place until a general meeting of the members had been called.

The proposal, however, had never been one which was pleasing to Barrhead Society. Immediately after the remit to Johnstone Society and the Paisley societies to collect information, a deputation from Barrhead had waited on the Bakery committee, and, after pointing out that the capital of the Society was far from being what it ought to be, they said they had been instructed by their committee to state that they considered it inexpedient in the meantime to proceed with the proposed branch at either Paisley or Johnstone because of the plant and other necessaries which would be required and which the funds of the Federation were not in a position to meet. It was owing to the determined opposition of the Barrhead and Thornliebank delegates and the strength of their argument that the capital of the Society was insufficient for the enterprise, that the Johnstone scheme was held over.

Nothing further was heard of the proposal until the beginning of 1876. By that time the trade of the Federation was taxing the productive capacity of the bakery to its utmost limits, and on the 29th of April a special meeting of delegates was convened for the purpose of considering the situation, and especially a recommendation by the committee that a small bakery which was to let in Paisley Road should be taken for a period of three years. A lengthy discussion took place. Mr Inglis, Paisley Provident Society, moved “that the committee be empowered to open a branch bakery, either in Paisley or Johnstone, and to lease temporary premises in the locality chosen until the new bakery was ready.” At once Mr Tolmie, of Avonbank, brought forward an amendment “that the committee be empowered to take such action at once as will appear to them to be for the best interests of the Federation.” Mr Paton, Paisley Provident Society, seconded Mr Inglis’s motion, and Mr Johnstone, Barrhead, the amendment of Mr Tolmie; but the motion that a branch be opened in the West was carried by 42 votes to 39 for the amendment. While the amendment did not prohibit in so many words the suggestion contained in the motion, it was believed that it would have that effect, because, although on this question of branching out the committee as a body had always held a neutral position, it was believed that they were not very favourable to the proposal of the Paisley and Johnstone societies.

BARRHEAD OPPOSITION.

It might appear that the question was now settled finally, but that was far from being the case. The Barrhead Society had always been opposed to the suggestion that a branch should be established at either Paisley or Johnstone, and it was suspected that the adoption of this proposal would lead to their withdrawal from the Federation. Whatever influence the decision may have had on the final step taken by Barrhead Society, however, other influences were at work there in favour of the society commencing to bake bread for themselves. At a meeting of the committee of that society, held on 6th March 1876, the propriety of the society erecting a bakery of their own was discussed on the motion of a Mr M‘Quarrie. The committee were not favourable to the idea, but at the monthly meeting, which was held four days later, a more extended discussion took place, and, although no formal motion was made at the time, the minutes of the society record that “the members seemed to be rather in favour of starting a bakery.” At the next monthly meeting, also, held in the beginning of April, the quality of the bread which they were receiving from the Federation was discussed, and a suggestion was made that the society intimate to the Baking Society that it was their intention to erect a bakery of their own. It is apparent, therefore, that the idea of entering into the baking industry for themselves was being considered by the Barrhead people before any definite decision had been come to by the U.C.B.S. on the question of placing a branch in the West. That decision brought the question to a crisis in Barrhead, however, and at the quarterly meeting of the society, which was held on 9th May 1876, the following motion was adopted by the meeting:—

“With a view to mend past and present complaints of the bread received from the wholesale bakery, and of preventing the committee from carrying out the motion passed by the delegates at their last general meeting to plant a branch bakery in Paisley, involving us in more debt, resolved that it is the opinion of this meeting that we withdraw from the Bakery and start a bakery on our own account.”

On 22nd May a committee was appointed by the committee of Barrhead Society to look out for premises which would be suitable for a bakery. This did not settle the question even yet, however. At the meeting of the Baking Society committee, which took place on 17th June, a deputation from Barrhead came to make suggestions, particularly about the delivery of bread in the latter part of the week. From the U.C.B.S. minute we can gather, reading between the lines, that the discussion had been warm. The committee’s account of what took place states that they had “no difficulty in overtaking orders in the beginning of the week, but it was somewhat difficult to overtake them at the latter end; but the committee refused to say that they could not supply the full complement to Barrhead on the Saturday; and that Barrhead be left to conduct their business as they thought best.” It would appear, from what is known of what was taking place in Barrhead, that the deputation had mentioned the likelihood of that society withdrawing from the Federation, and the last clause was the committee’s answer to what they may have interpreted as a threat. One good result of the meeting of representatives of the two boards was that the Barrhead people were induced to reconsider their position, for a special meeting of the members was held on 30th June at which the following resolution was adopted:—

“That the question of withdrawal from the U.C.B.S. and of baking for ourselves be adjourned sine die, and that this meeting declares itself of opinion that the bread supplied, while it is pure and wholesome, has not been up to the standard of quality and appearance required by our members; and that we are unanimously opposed to any extension of the United Bakery beyond the premises that it at present occupies; and that a deputation be appointed from this meeting to place these matters before its committee of management, and to urge upon them the adoption of means to improve the quality of the bread, and the necessity of reconsidering the recent resolution to plant a branch bakery in Paisley or Johnstone, in order to preserve the integrity and harmony of the Federation.”

The result of this deputation’s visit was that a special meeting of the U.C.B.S. committee was held on 29th July, when the committee decided “that we, as a committee, take no action towards the increasing of the productive power of the bakery until such time as we hear the opinion of the forthcoming quarterly meeting on the matter.”

Everything seemed to be going smoothly now, but it was only surface tranquillity, for at the same meeting where the Barrhead Society passed the resolution quoted above they also unanimously adopted another “to grant powers to the acting committee of this society (the committee which had been appointed to look out for premises suitable for a bakery) to rent, lease, purchase, or erect premises suitable for carrying on its own trade.” At the September meeting of the Baking Society, Mr Stark, Barrhead, moved “that in order to preserve the integrity and harmony of the Federation we consider it necessary that the resolution passed at special meeting of the Federation, held on 29th April, ‘to plant a branch bakery at Paisley or Johnstone,’ be rescinded by this meeting, and that no permanent extension of the bakery take place beyond the present premises.” Mr Hall, Thornliebank, seconded.

At once Paisley Provident delegates were on the alert, and Messrs Lauchland and Cumming of that society moved as an amendment: “That this meeting adheres to the resolution agreed to at special meeting on 29th April, in reference to the planting of a branch in Paisley or Johnstone.” The discussion was long and animated, but again the glamour of a branch was on the delegates, and the Paisley amendment was agreed to by 41 votes to 30 for Barrhead motion.

BARRHEAD DECIDES TO WITHDRAW.

This decision at once made its influence felt in Barrhead, and at the monthly meeting of that society which took place on 12th September notice was given of a resolution to the effect that “This Society hold a special meeting on 8th November to consider a motion ‘that this Society withdraw and cease to be a member of the U.C.B.S.’” At this special meeting the resolution to withdraw was agreed to by a very large majority, and on 4th December it was agreed that the Bakery committee be informed officially of the decision to withdraw, and that the letter state that the society would continue to purchase bread until their own bakery was ready. It is probable that this letter was a result of what had taken place at the Bakery quarterly meeting on the preceding Saturday, when the chairman had been questioned about the withdrawal of the society, and had stated that nothing official had yet been received from Barrhead Society with reference to their withdrawal. He was also questioned as to whether any steps had been taken with regard to establishing a branch bakery, and stated that no action had been taken regarding the branch. The subject then dropped.

DISSATISFACTION IN PAISLEY AND JOHNSTONE.

It is easy to understand that the Paisley and Johnstone societies were not satisfied with the delays which were taking place in placing a branch somewhere in their neighbourhood. They had succeeded in carrying their point in 1873, but the financial position of the Federation had prevented anything from being done. Then in April of 1876 they had secured a majority of votes—true, it was only a majority of three—in favour of their proposals, and in September this decision had been confirmed by a much larger majority. Yet, in view of the strenuous opposition of Barrhead Society and the repeated threats of withdrawal made by that society, they must have recognised that it would not do to hurry matters, for with almost 600 dozen loaves taken away from the weekly output of the Federation, the premises would be ample; and, in view of that contingency, the committee of the Bakery were justified in pursuing a cautious policy. Notwithstanding the chairman’s disclaimer of any “official” knowledge of Barrhead Society’s intentions, it was generally known throughout the Federation that they had decided to start baking for themselves, and it was doubtless this knowledge which was responsible for the statement by the chairman that “no action had been taken” to establish a branch being allowed to pass as quietly as it did.

A BRANCH IN GLASGOW.

Whatever might be the result of the withdrawal of Barrhead Society, however, if and when it did take place, there was no doubt but that the capacity of the bakery premises were overtaxed at the moment. The committee had been compelled to refuse offers of trade because of inability to supply the societies, and on discovering that a small bakery, situated in Paisley Road adjacent to their central premises, was to let, they came to the decision to appeal to the members for power to rent it for a year while awaiting developments. A circular was drafted and sent out to the societies, in which were explained the committee’s reasons for not proceeding with the branch bakery, and also the reasons why they considered it advisable that the small bakery in Paisley Road should be rented. The contents of this circular fanned the ire of the Paisley and Johnstone societies, whose delegates turned out in great force to the quarterly meeting, held on 3rd March 1877.

The circular was submitted by Mr Slater, secretary of the Federation, and gave rise to a lengthy discussion. It does not seem to have occurred to anyone that the Paisley and Johnstone societies might follow the example of Barrhead and withdraw, and the idea was largely entertained by the delegates that if a branch was established in that locality, it would relieve the congestion in the Central Bakery for a long time to come. Finally, after a very long discussion, Mr Inglis, Paisley Provident, moved “That the circular lie on the table, and that the committee take their instructions as to how they should meet the extra demand from the resolutions agreed to on the matter at previous meetings.” Mr Paton, Paisley Provident, seconded. Mr Steel, Avonbank, moved, and Mr Stark, Barrhead, seconded, “That the committee be empowered to rent premises temporarily in the vicinity of the present bakehouse.” The vote resulted in the amendment of Mr Steel being carried by 39 votes to 34 for the motion of Mr Inglis. The question was not yet settled, however. Immediately the result of the vote was declared, Mr O’May, Paisley Provident, rose and moved: “That this question be again brought up at the quarterly general meeting six months hence.” It should have been apparent to the delegates that this was a blocking motion and might prevent the committee from doing anything, but it was evidently not so regarded, or else the delegates could not make up their minds on the subject, for it was agreed to without comment. The committee did not allow the motion for reopening the question in six months to hinder them from going on with the new branch, for immediately the meeting was over they gave instructions to the sub-committee to secure temporary premises in the vicinity.

THE END OF THE PROPOSAL.

The subject again arose at the 34th quarterly meeting, held on 1st September, when Paisley Provident was again forward with a motion: “That if a branch be required after Barrhead had left the Federation, it be established at Paisley or Johnstone, and that the present branch in Glasgow be not retaken.” To this it was moved by Mr Gardiner, Cathcart, and seconded by Mr M‘Murran, Glasgow Eastern, as an amendment, “That this question lie over for six months.” After a long discussion the Paisley motion was withdrawn, on condition that the amendment limit the period of lying over to three months, and that, meantime, a special committee, constituted from the delegates present and from the committee, be appointed to investigate the matter and report to the next quarterly meeting. This was agreed to, and Messrs M‘Murran, O’May, Aitchison, Brown, and Slater were appointed the special committee. In less than three months’ time the committee sent out their report to the societies. The report contained details of three plans which the sub-committee had considered. The first of these, that of a branch bakery in Paisley, they considered could not be worked except at a slight loss. With regard to the second one, that of a branch at Johnstone, they considered that the loss would be slightly greater; while, with the branch at Johnstone, the trade would be more difficult to work. The third proposal which had been considered was that of increasing the number of ovens in the present premises, and in the report they stated they were not prepared to recommend any one of the schemes in the meantime, but recommended, instead, that the branch in Paisley Road be taken for another year. The reason they gave for this recommendation was that they considered that an inquiry should be made into the advisability of introducing machinery into the bakehouse, as the whole of their premises would be vacant in eighteen months and could be utilised; if the result of the inquiry was satisfactory, steps should then be taken to have it introduced. This report was accepted by the delegates at the quarterly meeting, and so a subject which had been a fruitful source of controversy at the general meetings of the Federation for nearly two years disappeared. It was again raised at a quarterly meeting some years later, when the question of removing altogether from St James Street was being discussed, but was summarily disposed of by the delegates.

BARRHEAD, JOHNSTONE, AND PAISLEY PROVIDENT WITHDRAW.

Meantime the Barrhead bakery was ready for work and baking was commenced in the last week of the year, but the society, although it had withdrawn a large proportion of the loan capital invested with the Baking Society in order to pay for the erection of its own bakery, retained membership of the Federation until requested by the committee to withdraw as the interest on the share capital was an unnecessary burden on the Federation’s funds. The society was allowed to withdraw without any of its capital being retained, being the first of the withdrawing societies to which this privilege was extended. In 1894, after fancy biscuit baking had been firmly established by the Baking Society, Barrhead Society rejoined again, taking up 1,500 shares.

Another withdrawal which occurred in a comparatively short time, and which was doubtless influenced to some extent by the refusal to establish a branch in the West, was that of Johnstone Society. At a meeting of the committee which took place on 15th February 1879, the minutes record a conversation which took place regarding a decision of that society, come to the previous evening, to start baking for themselves. The effect of the information that they were likely to lose Johnstone Society’s custom so soon after having lost that of Barrhead had a damping effect on the spirits of the committee, and it was decided that in the meantime the erection of the new ovens which they had proposed to build be not proceeded with. With the withdrawal of Paisley Provident Society at the end of 1880, consequent on having a bakery of their own ready for occupation, the controversy with respect to the branch, and also its effects on the welfare of the Federation, may be said to have ended.

The Federation had lost three of its best customers, but it had succeeded in keeping its business centralised. It must always remain a matter of argument whether it would have been better to branch out at an earlier date and do for the societies in Renfrewshire that which in later years it has done for Clydebank and the North of Ireland. The question of branches is still one on which there is considerable controversy, and, at any rate, it is certain that the committee, and latterly the delegates, played for safety, and chose to conserve the strength of the Federation at a time when all its strength was needed rather than weaken it by widening the scope of the society’s energies. The majority of the committee, it is quite evident, were opposed to branching out, for had this not been so, they would have gone ahead when two general meetings of the Society gave them the mandate.

It is difficult to see that any great harm was done by the course which was adopted. The growth of the three societies has been so great that each of them is large enough to maintain a bakery of its own, and although the Federation had one or two temporary setbacks, none of them was serious enough to affect its stability or its efficiency. It is possible, therefore, to argue that either decision would have had equally good results. There we may leave what was undoubtedly a stirring controversy while it lasted, the importance of which at the time forms sufficient justification for the space which has been devoted to it.