Co-ops 1-2-3: Three Things You Should Know About Co-ops

coop_emgrA co-op, or a co-operatively-owned enterprise, is probably the least well known form of business in the United States. We think that’s a shame because co-ops really have a lot to offer when it comes to a community getting the services they need. They’re already a substantial part of the US economy: 30,000 co-ops provide more than 2 million jobs in US, according to National Co-operative Business Association.

As part of our ongoing celebration of National Co-op Month, here are three great things about co-ops:

1: Profit takes a back seat.

A co-op’s first priority is not to turn a profit–it’s to meet the needs of their membership. Those members typically are the people who live right in the community where the co-op is located. Most importantly, co-ops seek to provide their services in a socially-responsible manner. At Abundance, for example, we aim to source food from farms and food producers that do not engage in exploitative labor practices because our membership wants to support an ethical market.

2: There are (many, many) different kinds of co-ops.

There’s no one way to do a co-op, and that’s another great thing about them. The versatility of the co-operative model allows a rich diversity of enterprises that help people around the world in all sorts of ways.

Hardware stores, funeral homes, farms, schools, and manufacturing plants are just a few examples of organizations that can be co-operatively owned. Some co-ops are for-profit and others are nonprofit–what a co-op looks like and how it works all depends on the needs of the people who set them up.

Below is an excellent list of the types of co-ops that exist put together by Co-operatives and Mutuals Canada, a Canadian advocate for co-operatives.

Worker co-ops: The purpose of these co-operatives is to provide their members with work by operating an enterprise. The co-operatives are owned by their employee members. Examples: forestry, leisure, production and manufacturing, tourism, communications and marketing, etc.
Producer co-ops: Some co-operatives process and market their members’ products and services directly while others may also sell the input necessary to their members’ economic activities. Examples: agriculture co-ops, pooling of equipment, advisory services, etc.
Multi-stakeholder co-ops: The membership of these co-operatives is made of different categories of members who share a common interest in the organization. Examples: home care services, health services, community services, etc.
Worker-shareholder co-ops: These are incorporated co-operatives that hold partial ownership of the business in which the co-op’s members are employed. Because of its share capital, the co-operative may participate in the management of the business and the workers may influence work organization. Examples: production and manufacturing, technology, etc.
Consumer co-ops: These co-operatives are set up to provide members access to a specific type and/or quality of product or service at a reasonable cost. Examples: food co-ops, retail stores, etc.

3: Anyone, anywhere can set up a co-op.

All co-ops begin with a group of people coming together and realizing they can achieve a common goal by working co-operatively. The initial capital needed to get going is shared by members. Likewise, once the co-op is operating, each member shares in its success. A co-op starts off with something similar to crowd-sourced funding, but then it goes so much further. There are many resources available around the world to help people who are setting up a co-op. Plus, it’s part of the co-operative mission to help other co-ops thrive, so other co-ops are always willing to help when they can.

Co-ops can be found anywhere and everywhere. Rural areas. Cities. All over the world, cold and hot.

Since the purpose of a co-op isn’t to make investors rich, co-ops are less interested in competing with one another. The Seven Co-operative Principles, which contains the internationally agreed guidelines of how co-ops work, reads: “Cooperation among cooperatives.” Not bad, right? (Read “The Seven Co-operative Principles” here.)

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