CAP

They provide jobs for handicapped people, aiding their integration through direct contact with customers; bring about local regeneration (by providing accessible facilities for people without cars); and counter exclusion by offering services such as home delivery of meals or postal services.

Information/research

GDW Süd helps each new licensee to draw up a business plan. The long retail experience and contacts that GDW Süd possesses mean that it can offer extremely accurate advice to intended licensees. For instance when a new location is under consideration, it can often find out through trade connections what the previous turnover was, thus reducing the risk of opening up.

Once the shop is trading, it gives management support using benchmarking tools it has developed over the years. These enable licensees to compare their own performance with that of comparable shops, discern their strong and weak points, set realistic targets and measure their future performance against them.

A generous financial framework

Germany's social security law provides that firms must employ a certain quota of "severely disabled" people. Those that do not are obliged to pay into a ‘compensation fund’ instead. This fund is used to pay a wage subsidy to integration enterprises (Integrationsbetriebe) that do employ disabled people. This allows higher staffing levels to be maintained, which both compensates for the lower productivity of some workers, and allows an atmosphere to be created in which people have time for each other. This makes the jobs sustainable for disabled people.

The investment required to open a shop is reduced by the fact that a sum of between €10,000 and €15,000 per job created for a disabled person is also available, half of which is loan and half grant. Some private foundations will also make grants of as much as €100,000 towards start-up costs.

An important but often forgotten factor is that it was the relatively generous – in the European context – subsidy regime that applies to sheltered workshops that allowed them to accumulate the working capital needed to develop the business idea in the first place.

A good market segment

The concept also offers many advantages to shoppers:

- the customers have money as well as a mission

- the service is in demand by two stakeholders: local communities as well as unemployed disabled people. This gives access to multiple sources of support

- a culture of friendly and helpful service: staff can take the time to advise and chat with customers, and customer suggestions are welcomed

- a wide range of products – 7,000 lines – which makes it a ‘one stop’ alternative to out-of-town supermarkets. While four-fifths of sales must be from the CAP Market range, the remaining fifth can be sourced elsewhere, to suit local and regional tastes.

- developing new services to gain customer loyalty – for instance delivery

- ecology: going with the trend to energy-saving and against out-of-town shopping

- industry experience: the managing director has a long working history in retail

- the connections and market intelligence that comes with that experience

- fairness: a balanced license agreement that combines local autonomy with central discipline

- solidarity and mutual aid: a structured decisions and information system based on regular meetings

- critical mass: the CAP group has built up sufficient size it has negotiating power with its suppliers, and especially EDEKA, from whom it gets a small discount over the prices that are available to member retailers generally; in return it provides EDEKA with a significant boost to sales, without the headaches of giving detailed support to each customer

Integration philosophy

- Acceptance of disability: the employers know and accept their employees’ health circumstances, and tolerate a certain level of mistakes, which gives the employees a sense of security.

- Time for people: staff are expected to work to the best of their abilities, but are not excessively pressurised.

- People first: the shops do not need to maximise profits; it is sufficient that they break even and make a small surplus.

Business idea

The business idea has the strength of generating benefits for several stakeholders:

- for the licensees, the key benefits of opening a CAP Market are that they are joining well-known and trusted brand. This generates customer loyalty and reduces advertising expense. They receive, in return for a relatively low levy on turnover, a great deal of invaluable help and advice born of long experience in the sector. This covers location, shop design, the product range, recruitment, management systems and much more;

- for local politicians, a CAP Market offers integration for disabled people, urban regeneration, improved local services and environmental sustainability;

- for disabled people, it provides a job under conditions that are close to those in the mainstream labour market, and which are subject to standard employment contracts, but which are humane and which suit vulnerable people. Most jobs are full-time, but there are also some part-time jobs such as collecting trolleys, which are paid on an hourly basis and serve to ease people back into the discipline of working.

Customer loyalty is further rewarded through a loyalty card which, after 20 shopping visits, gives the customer the right to a small gift.