Co-Operation and Some of its Beneficial Results

How the system has worked in a leading Canadian departmental store — Employees taught to save and acquire financial interest in the business — Some practical lessons attained — How those employed view the plan.

April 1 1908

Co-Operation and Some of its Beneficial Results

How the system has worked in a leading Canadian departmental store — Employees taught to save and acquire financial interest in the business — Some practical lessons attained — How those employed view the plan.

April 1 1908

Co-Operation and Some of its Beneficial Results

How the system has worked in a leading Canadian departmental store — Employees taught to save and acquire financial interest in the business — Some practical lessons attained —How those employed view the plan.

FOR the amelioration of the condition of those who toil, several projects have been devised, many plans undertaken and numerous reforms suggested. Some have partially accomplished the object sought; others have proved a complete disappointment.

The study of economical problems is always interesting ; sociological questions will always be an absorbing subject. As the world progresses, as civilization advances, new theories present themselves and are frequently put into practice. Once the experimental stage has been successfully passed, they generally become part and parcel of our social fabric.

The relations of the employer and employe in the great world of labor are often strained. Perhaps in the past there has been too much suspicion, too much luke-warmness, jealousy or prejudice on either side. But that day is passing, and greater confidence, more of the spirit of co-operation and unity of purpose are being manifested. Where radical moves have been tried, and apparently revolutionary plans put into execution, from these there is no turning back if the ventures meet with reasonable success. On all sides to-day the truth of the maxim, “Unity is Strength,” is recognized—equally as much as the Biblical reference that “A house divided against itself cannot stand.” Within the last decade the hours of toil have been shortened, wages materially augmented, and the conditions that contribute to human comfort and happiness greatly improved. The weekly half-holiday is an institution

that has come to stay. It has become wide in its popularity, beneficial in its results, up-lifting in its influence, and general in its observance. With all these changes—shorter hours, weekly half-holiday, higher wages—what has been the result? The amount of work, the output of raw material and finished product, has increased. In large industrial or mercantile establishments employes, under the altered and better state of affairs, are generally conceded to accomplish as much or more as when the old order of things prevailed.

To trace the process of the evolution would be most interesting, but so many phases are involved that only one can be considered at a time, if adequate justice is to be done within ordinary limits on the subject. Welfare work, savings departments and co-operative plans have evidently worked well, where tried in the land across the border, and in Canada, too, the results have proved satisfactory, although such movements as yet are comparatively few. In the City of Hamilton, often termed the “Birmingham of Canada,” by reason of its great industrial activity, and the varied character of its manufactures, a large departmental store has for five years carried on a Co-operative Plan, and Employes’ Savings Department. It is interesting and instructive to view the results and allow them to speak for themselves. The firm in question is that of Stanley Mills & Co., Limited. They have been in business for a score of years. About fifteen years ago they took up the departmental store idea and added many new lines of merchandise. Five years ago fire wiped out their building, which was re-erected on a much larger scale. A limited liability company was formed with a capital stock of $100,000, of which $25,000 was preference stock, and $75,000 common stock. The former was retained by the old company, and the latter all assumed by the new company, of which Stanley Mills is president, Robert Mills, secretary-treasurer, and Edwin Mills, managing director.

It was then resolved to allow the employes of Stanley Mills '& Co., Limited, the new firm, to take a financial interest in the business, and acest per annum. This departure was guaranteed to bear 8 per cent, interest per annum. The departure was decided upon—not from any financial pressure—but solely in order to. give employes an opportunity to obtain an interest in the business and to inaugurate a co-operative plan, which, it was believed by the promoters, would be mutually advantageous. One thousand shares were set apart, each share representing $25 par value. An eight per cent, dividend was guaranteed by the firm ; the accrued interest thereon being payable in quarterly instalments.

In 1903 this plan was introduced, and at the annual meeting of the company,. held the other day, the benefits to be had from co-operation in business were strikingly illustrated. The old directors were re-elected, and it was decided to increase the stock of the company from $100,000 to $500,000, which, in itself, is a concrete argument of a very convincing character of the growth and prosperity of the firm. Mr. Mills strongly advised employes to take up more of this preferred stock, saying it was an absolutely safe investment, and that he would like to sec more of the employes interested in the scheme if only to the extent of one share.


In 1903, the co-operative plan was introduced. At first the number of shares taken by the employes of the firm was small, but the following year an Employes’ Saving Department was started, where sums of 10 cents per week and upwards were received, and interest at the rate of six per cent, per annum allowed on all deposits. The practice of regular systematic saving was encouraged and the jingling rhythm, “every little bit added to what you got makes just a little bit more,” became a principle practised in daily life. As soon as the sum saved amounts to $25, it has to remain at this figure, drawing interest at six per cent., or else it can be exchanged for one share of preferred stock of the company, bearing eight per cent, interest. Thus were the employes afforded a safe and profitable investment for any portion of their money or earnings that they might see fit to lay aside from week to week. Other simple conditions governing this feature of the co-operative plan were :

When a deposit is exchanged for a preferred share, the employe may then open up a new account in the savings department. Deposits in the savings department may be withdrawn at any time, and interest will be paid to the date of the withdrawal. The savings department is open every day (except Saturdays) from 8.30 to 11.00 a.m. Employes severing their connection with the firm, and having deposits in the savings department, will be paid such deposits with accrued interest on the day of their leaving.

The success or failure of any move after it has passed the probationary period, has to be gauged by results. Although not yet five years in operation, out of the 1,000 shares of preferred stock—each share being $25— 496 shares, or practically one-half, have been taken up by the employes, and the number is constantly growing, so favorably do those in the service of the firm regard the co-operative plan and the savings bank department. Fully one-third of the employes are now shareholders in the firm and the number has never fallen below one-quarter. Of course, it varies in number in much the same manner as do savings deposits in chartered banks. In times of prosperity and abundance of employment, deposits in the country’s monetary institutions naturally grow, but, when a wave of depression comes and there is a stringency, the savings are withdrawn in a greater or less extent to meet pressing conditions or tide the depositors over a period of uncertainty.

The same order of things holds true in connection with the shares and savings bank accounts in Stanley Mills & Co.’s establishment. Sickness at home, some member of the family out of work or totally unforeseen demands result at times in an employe converting his or her share, or shares of preferred stock into cash or withdrawing a portion or all of his or her savings. It might here be mentioned that the preferred stockholders have not only received the eight per cent, guaranteed interest on their holdings, payable in four equal quarterly instalments since the system was begun, but during the past two years the stock has carried a bonus of two per cent., so satisfactory has been the outcome. The stock can be held only by an employe, no outsiders being allowed to participate. Many of those in the service of the company have, by systematic saving, increased their holdings in five years from one or two shares, to ten, fifteen and twenty shares. Some lay up ten cents a week, others twenty-five or fifty cents, while older employes and heads of departments, who are in receipt of good salaries, set aside one, two or three dollars or even more.


In four years there have been 89 depositors whose savings have aggregated $2,600. On June 30th, 1903, there were 296 shares held by employes ; to-day, as previously stated, 496 shares are held. Since the system was started only one shareholder has attempted any dishonest act, and only one employe who was a shareholder, has left the firm to take another position. A number of lady shareholders have resigned and have been paid the amount of their savings, as well as selling their holdings in stock to the firm, but the positions they have secured have been as queens of households, or, in other words, they have become happy, contented life companions of honorable, industrious husbands.

When interviewed, several clerks, representative of every department, unhesitatingly expressed approval and appreciation of the co-operative plan. They all remarked that it had been helpful, beneficial and useful in every particular. One prepossessing head of a department observed: “Before

the system here was begun I was in the habit of spending all my spare money on ice cream, candy and trolley car jaunts. To-day as a result of this easy, simple and practical method of saving something every week, I have nineteen shares of preferred stock. I consider the co-operative plan a grand one, indeed.”

Another clerk, who occupies a subordinate position, said : “I have been

saving thirty cents a week out of my salary. It seemed like a mere pittance —so I thought at first—but with the interest added it is now quite a tidy sum. I feel as if I had a personal interest in the firm, and I hope the system will continue. I have been here two years now, and during that time I have not heard one word of unfavorable criticism or any fault finding with the plan or its administration.”

A manager of another department —the head of a household and a large family—said that he had recently received two advances in salary, and that he drew only the old figure. “I leave the raises,” he remarked, “to be put in the savings department, and if there was not such a department to encourage saving, I do not know what I would do. I feel certain I would have been but little better off. Now, I have something tangible to show—these stock certificates.”

One of the apprentices in the dress goods branch modestly observed that he was getting $5 a week, yet he was depositing 40 cents out of this sum in the savings bank each pay day, and he confidently added : “I will soon have enough there to own a share in the business.”

And thus the story ran varied somewhat in manner of expression, but the voice of one was evidently the voice of all—a chorus in unison and harmony in praise of co-operation.

There are two sides to every story, and the promoters of the proposition —the members of Stanley Mills & Co., Limited, declined to discuss at any length their version of the economic problem. “We are, never have and do not intend to, seek publicity over what we have seen fit to carry out,” declared one of the proprietors. “We simply feel that we are getting a little more in direct touch and contact with our employes than the average business establishment. It has brought our employes nearer to us and has increased their interest in the business so that not only they, but we have benefited by it.”

“What about results ?” was asked of another member of the firm. “We are perfectly satisfied. Our trade in five years—since this plan was undertaken—has nearly doubled in volume. We have no grievance or misgivings whatever. We have simply tried to do by others as we would like to be done by in the e^ent of our positions being reversed.”

One or two more points and the story is told. There is neither red tapeism nor technicality about the co-operative plan or savings bank department. Everything relating to their management, control or operation is simple, direct and plain. Only the good and welfare—individual as well as collective—of the employes is the animating motive or underlying principle of the enterprising departmental establishment in the Ambitious City.

Lest it might be pointed out by some one, that favoritism or partiality might be exercised by the promoters of the co-operative plan, in dismissing, promoting, or giving increases to employes, and some discrimination practised in favor of those who are not shareholders, one fact may be plainly stated. The person who engages, advances or dismisses the employes, has nothing whatever to do with the savings bank or preferred stock features of the business. He is not even aware who are or who are not stockholders, and, consequently, all increases in salary or elevations in position are based solely on efficiency, qualification and faithfulness in the discharge of duty—and on no other ground.

The Busy Man’s Magazine in future issues hopes to present in a strictly fair and impartial manner other features along industrial and sociological lines, such as Welfare Work, Employes’ Mutual Benefit Associations, etc., believing a dispassionate discussion of such matters and the presentation of concrete facts—exemplification of the practical working out of plans—are far more forceful and impressive than all the theses or theorizing that may be offered.

Be thou not held in thrall of Yesterday. Fling off his rusting chain of tyrannies. Then up! Draw breath in freedom; and away To rule thy servant,—the strong Hour That Is !