Persons who benefit from the products or services of a cooperative society are the owners of the cooperative enterprise. In the case of a food co-op, the people who shop in the store are owner members. In the case of cooperative housing, the persons living in a particular building are members of the cooperative that owns the building. Cooperatives can be large or small, can exist in a number of industries or sectors, and can take different forms depending on the identity of the cooperative`s members. Here are some examples of cooperative types: Cooperative banking networks that have been nationalized in Eastern Europe now function as true cooperative institutions. In Poland, the SKOK network (Spółdzielcze Kasy Oszczędnościowo-Kredytowe) has more than 13,000 branches and is larger than the country`s largest conventional bank. Many co-ops follow Rochdale`s seven principles: Okay, you have your idea and you`ve found that it has the potential to make money and succeed. What else? It`s time to lay the groundwork for your new business. You need to set up a steering committee and create a business plan.
Of course, every business model has drawbacks. The trick is to determine if the pros outweigh the downsides and/or challenges of your goals. When it comes to cooperatives, there are three main drawbacks: One of the biggest advantages of a cooperative is the equality associated with its leadership and degree of democracy overall. Members can satisfy all their needs without having to submit to a single person. This fair way of organizing makes the cooperative enterprise much more stable than a normal enterprise. Members come and go without necessarily disturbing how things work. In fact, whenever a change is needed, the whole group of members will have to decide on it. Since each member has only one vote, all members of the company are equal, regardless of the number of shares they own. In general, all members are required to use or contribute to their co-op and have a say in the management of the organization. Cooperatives are subject to state and territorial laws, national cooperative law. Loomio is an “open source software developed by an employee-owned cooperative social enterprise” that began in 2011. The team behind the cooperative is based in New Zealand and their app helps people communicate and collaborate more effectively.
Many users report higher productivity and better decision-making once they start using the tool. With your steering committee, you can then create a comprehensive business plan that outlines your co-op`s path to success. Make sure your plan includes information about what your co-op offers, the market it will enter, the products it will sell and how they will be made/acquired, how you plan to promote and grow your new business, and financial data. The cooperative movement dates back to the mid-19th century, but the concept goes back even further, to craft guilds, peasant organizations and mutual insurance companies. Die Genossenschaftsbewegung des 21. Century has distinguished itself by the growing emphasis on equality and concern for people and the planet in addition to profits (these three are sometimes referred to as “the triple bottom line”). The cooperative brings together all the actors in the food chain, from the farm to the consumer, represented by six different categories of members: this is not the case for a cooperative. Since justice and equality are among the basic principles of a cooperative, each member-owner of a cooperative receives one vote. The opinion of one member of the cooperative carries no more weight than the opinion of another member of the cooperative. Producer cooperatives have producers as members and provide services associated with the relocation of a product from the place of production to the place of consumption.
Unlike worker cooperatives, they allow companies with several employees to join. Agricultural cooperatives and fisheries cooperatives are examples of this. Although business cooperatives are inherently democratic and often have a socially conscious business ethic, the main goal of a business cooperative is not to provide a community service, but to make a profit. As a rule, a percentage of the profits is evenly distributed among the owners, while the rest is reinvested in the company. There are cooperative societies in the retail, agriculture, health, manufacturing and other industries. Business cooperatives are registered and act as cooperative societies. Nicky is an economic journalist with nearly two decades of practical and editorial experience. It has been published in several trade publications, including The Employment Times, Web Hosting Sun and WOW! Women about writing. She also studied economics at university.
Cooperatives are based on the philosophy of mutual aid. It is not only about uplifting members economically, but also morally and socially. Membership conveys a spirit of independence, cooperation and tolerance. Almost all cooperatives need money to start and work successfully. How will your co-op get this initial capital injection? For many co-ops, funding comes primarily from their members – at least initially. Other options include start-up grants and business loans. Spolok Gazdovský was founded in 1845 by Samuel Jurkovič and was the first cooperative in Europe.  A “purchasing cooperative” is a type of cooperative, often between companies, in order to agree on aggregate demand in order to obtain lower prices from selected suppliers.
Retail co-operatives are a form of buying co-operative. Draft legal documents: all cooperatives are legal entities and must be established. This is usually done through state laws and involves the development of laws and statutes. Hire a lawyer to do it for you. Be very complete about the scope of the business. Statuses can start fundamentally and then grow with the company. This collective effort was at the origin of many British construction companies, but they developed into “permanent” mutual savings and loan organisations, a term that has persisted in some of their names (such as the former Leeds Permanent). Nowadays, such DIY can be financed by a step-by-step mortgage, which is gradually released when the building is completed.
The term can also refer to worker cooperatives in the construction industry. In Tanzania, the cooperative method has proven useful in water distribution. When people are busy with their own water, they care more because the quality of their work has a direct impact on the quality of their water. A volunteer cooperative is a cooperative managed by and for a network of volunteers for the benefit of a defined member or the general public to achieve a goal. Depending on the structure, it may be a collective or reciprocal organization operated according to the principles of cooperative governance. The most basic form of voluntary cooperative is a voluntary association. On this basis, a lodge or social club can be organized. A volunteer-run cooperative differs from a worker cooperative in that the latter is by definition employee-owned, while a volunteer cooperative is generally a non-public enterprise, a volunteer-run consumer cooperative, or a service organization in which employees and beneficiaries jointly participate in management decisions and receive discounts based on welding capital. In 2012 [Update], the number of cooperative memberships reached one billion and thus the organizational structure and movement penetrated popular culture. Be part of our work to promote the common interests of the co-operative community.
As far as control is concerned, there is still a difference compared to a normal company. In an ordinary company, each share receives a single vote. This means that investors can buy as many shares as they need to gain some degree of control in the company. In a cooperative, things are very different. Each member receives only one vote, which creates equal voting rights. All members then participate in the management of the cooperative enterprise and share the associated responsibilities. In the HBO drama series The Wire, several drug dealers form a Democratic alliance called the New Day Co-Op with an interest in reducing violence and boosting business. Unless a highly qualified manager is also a member of the co-op, the business will likely have to continue without the help of an executive professional. And often, cooperatives fail due to mismanagement, the steering committee: This particular group of people can identify the core values and mission of the cooperative, as well as represent potential members of the cooperative enterprise. You can then develop a plan and do the necessary research to grow the organization. Co-operatives are owned and controlled by members rather than investors, giving members more control and autonomy. This allows them to manage things as they see fit, without always having to bend to the will of the all-powerful dollar.
Note that if you convert an established business to a co-op, this process will be different. In addition to founding a cooperative, drafting articles of association, etc. you also have to buy the original owners/founders and then redistribute this money to the cooperative. Bylaws are a document that makes your co-op an official business. This document contains the name, location, purpose, financial structure of your company and the names of your founding members (founders/founders). Your founders must submit the articles to your state registrar. Members of a construction cooperative (known in the UK as a DIY cooperative) pool their resources to build housing, usually using a high proportion of their own work. .