Ask any group of consumers to name the UK’s most enduringly successful mutual enterprise and they will probably point to the Co-op or the Nationwide building society. But there’s a cognoscenti who will come up with a different answer: a business that operates from giant sheds beside a railway track at Stevenage. It is the Wine Society, now celebrating its 150th year.

Back in 1874, a quantity of Portuguese wine lay in the cellars of the Royal Albert Hall in Kensington, shipped there for an International Exhibition but overlooked and unsold. After the Portuguese shippers complained, a series of tasting lunches was organised – by Major General Henry Scott, one of the architects of the hall and the secretary to its commissioners, and Brudenell Carter, an ophthalmic surgeon – with a view to shifting the stock. From there grew the idea of the International Exhibition Co-operative Wine Society, founded to import good wines direct from growers and sell them to members at the lowest possible prices.

‘Passion before profit’ was the slogan I recall from a fine lunch at the Stevenage HQ some years ago

A co-operative is an association through which a common economic need is satisfied by a jointly owned enterprise with no third-party shareholders; mutual societies, mostly engaged in lending and insurance, do the same thing. The first great wave of mutuality was the building society movement that sprang up in the late 18th century to house the workers of growing industrial cities. The Rochdale Society of Equitable Pioneers, founded in 1844, was the prototype of grocery co-ops; the Co-operative Wholesale Society followed in Manchester in 1863.

So the model was well established by the time Scott and Carter first pulled a cork – and their society’s objective of satisfying members’ thirst for value has proved fruitful ever since. A single £40 share confers lifetime membership (newcomers can claim £20 of it back on their first order) and there are currently 178,000 ‘active’ members placing regular orders, plus a larger number who hold shares but have got out of the habit. At any time, they can choose from up to 1,700 wines, bought from 800 suppliers and priced between £6 a bottle and £100-plus.

The business is entirely about what pleases the members. ‘Passion before profit’ was the slogan I recall from a fine lunch at the Stevenage HQ some years ago, hosted by the then chief buyer Sebastian Payne MW. The current chief executive, Steve Finlan, who joined in 2018 after senior roles with Marks & Spencer and Clarks shoes – both shareholder-owned companies well known for attention to customer care – says his previous employers were ‘not even close’ to the Wine Society in that regard.

All been plain sailing and sustainable growth since 1874, then? Not quite. Brexit complicated the import process for all wine shippers, though suppliers absorbed much of the extra cost, and was one reason why the Society closed its French outpost at Montreuil-sur-mer. Covid prompted a brief closure of the Stevenage warehouse – followed by a lockdown bonanza as members drank more wine at home than ever before, turning 2020 and 2021 into exceptional years. The relative normality of 2022 saw revenues drop from £160 million to £148 million, but the business is still 50 per cent bigger overall than it was in 2019.

Most recently, a 44p-per-bottle increase in alcohol duty on still wine, effective from last August, caused a temporary fall in market volumes and trouble for discount sellers such as the loss-making Naked Wines. But the Society’s sales stayed ‘broadly flat’ and were up 14 per cent over Christmas compared with 2022.

As to competition, every major wine merchant nowadays offers a slick website and home delivery service –but the Society reckons its free next-day offer is a match even for Amazon. And what of the constraint that affects all co-ops and mutuals, as well as employee-owned businesses such as John Lewis Partnership, which is that their structure prevents them raising new equity capital from outside sources to fund expansion?

Not a problem, says Finlan: if it had to, the Society could borrow against £22 million worth of ‘keeping stock’ wines. But his predecessors had the foresight to acquire a freehold site at Stevenage large enough for successive warehouse expansions, all so far financed from cash flow.

As to members’ changing preferences, the Society’s director of wine, Pierre Mansour, observes a trend towards ‘fewer bottles but better’, with a £12 average that’s double the UK market standard. And there’s increasing willingness to explore: Greek wines now outsell Argentinians. More controversial perhaps will be a move towards ‘bag-in-box’ table wines and even plastic bottles.

But whatever comes next will be a response to what loyal member-customers want. This is an admirable business but also a rare one because, attractive though mutuality may be as a form of alternative capitalism, launching a mutual enterprise and sustaining it at scale is extraordinarily difficult. Just look at the crippled Co-operative Bank, no longer a co-op at all and perpetually searching for deep-pocketed new owners.

But I digress: there’s a big programme for the Society’s 150th anniversary, including exhibitions, masterclasses and the release of ‘generation series’ limited-edition stock reflecting the Society’s history, including a Portuguese Bucelas descended from the first wine bought by the Society in 1874. The last scribbled note of my conversation with Steve Finlan and Pierre Mansour says simply ‘long lunches’. What could be better?