Retailer launches major investment drive as households continue to struggle with cost of living

The Co-op has pledged to inject £1 billion into the UK economy over the next 12 months, unveiling a wide-ranging plan to “Back Britain” in the wake of the Autumn Budget.

The move, announced this week, will channel investment into lower prices, British farming, skills and high street regeneration, as the retailer says responsible business “must play its part” in supporting communities through continued economic pressure.

The commitment follows the Government’s decision to finally implement long promised business rates reform – a change the Co-op said would give smaller retailers greater certainty to invest.

Cost of living still the top concern for members

Fresh insight from the Co-op’s membership research shows 58 per cent of respondents now place the cost of living among their top three worries, up from 51 per cent last year. Concern is highest among younger members, with 72 per cent of those aged 18 to 34 citing it as a major issue.

Shirine Khoury-Haq, Co-op Group chief executive, said the Budget offered long awaited clarity for local shops and communities.

“The Government’s decision on business rates is a welcome and important step that will help protect jobs, strengthen local economies and support high streets across the country,” she said.

“Co-op is stepping up alongside this commitment, facilitating over £1 billion of spend into the UK economy over the next year. This includes our biggest ever number of price reductions to help with the cost of living, continued investment in British farmers and suppliers, and a focus on keeping high streets vibrant and safe.”

Major price cuts planned across 1,000 products

The retailer is preparing one of the largest rounds of price reductions in its history, cutting the cost of more than 1,000 products across its 2,300 stores and online next year.

The investment will focus heavily on British produce, dairy and protein, and will extend beyond members to the 15 million weekly transactions in Co-op shops. The business says cost of living concerns consistently top feedback from its seven million members.

Strong backing for British farmers and suppliers

The Co-op will continue to spend over £700 million a year with British farmers and agriculture suppliers, maintaining its commitments to 100 per cent British fresh and frozen meat, eggs, milk, potatoes and carrots.

It is also investing in the next generation of UK food producers and manufacturers, and has urged the Government to ensure domestic agriculture is properly supported as the sector faces climate and environmental pressures.

Beyond food, more than £580 million will be spent with UK based goods-not-for-resale suppliers, while the Co-op’s energy-buying arm will deliver £6.4 million in UK energy procurement over the next year.

The Group is also reviewing its pension investment strategy to channel more of its defined-contribution fund into UK companies and markets.

Investment for high streets, safety and communities

The Co-op welcomed the Budget’s business-rates reform, saying it provides “much needed certainty” for smaller retailers and underpins future high street investment.

Over the next year, the business will invest in around 100 stores – including new openings, relocations, redevelopments and refits – alongside rolling out new sustainable “showcase stores” designed to trial low-carbon technologies.

The retailer will also continue its significant £38 million annual spend on retail crime prevention, which includes security technology and police partnerships aimed at curbing theft and violence against staff.

Community funding remains a core part of the plan. Over the past five years, the Co-op has shared £63 million with 22,500 local causes through its Local Community Fund, with new support reaching thousands more. Its £7 million partnership with Barnardo’s continues, as does £2 million of investment through the Co-op Foundation to strengthen grassroots youth organisations.

Boosting opportunity through apprenticeships and education

The Group aims to create 7,000 matched apprenticeships by 2030, having already transferred £40 million of unspent levy funds from large employers to smaller organisations since 2021. An additional £6 million is expected to be shared in the next year.

It also provides £1 million annually to its 38 Co-op Academies, supporting disadvantaged pupils with enrichment activities, essential items and discretionary headteacher funds.