"WHAT IS A CO-OP?"
WHAT IS A CO-OP?
Let’s dig a little deeper…
For starters, the term “co-op” is short for co-operative.
OKAY, SO WHAT IS A COOPERATIVE?
Definition: A co-operative is an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs through a jointly-owned and democratically-controlled enterprise.
HOW ARE CO-OPS DIFFERENT AND WHY DO THEY MATTER?
The term cooperative or co-op may seem like a modern movement, but the co-op business model has been in existence for more than one hundred and fifty years, dating back to English tradesmen who banded together to open their own store of food items they could not otherwise afford. From the outside, a co-op, may look like other conventional businesses, but its business practices and governance structure are what makes it so different.
A cooperative is developed to serve its members and fill a needed service. And because the organization is democratically owned, the members (also owners) have control over the organization by electing the Board of Directors, or running for the board themselves, who guide the mission of the co-op. Unlike large, conventional groceries, whose goals are to produce large revenue, line the pockets of heavy investors and expand their corporate footprint, any profits at a co-op, beyond what is needed to sustain the business, are returned back to the membership, based on their use of its services (how much they shopped). The overall goal of the co-op is to provide needed goods and services to a community and the democratic business approach fuels a powerful, rewarding, and genuine experience for its member-owners and public customers alike.
CO-OPS MAKE A DIFFERENCE.
Because the word co-operative is derived from cooperation, it’s understandable why the overall purpose is to come together to fill a need. We’ve all heard the adage 1+1=3, right? That is the foundational value that co-ops are built on. As members of the community come together, there is increased value in the product produced, and in this case, a community grocery store. This format allows individuals to have a voice and partner with other co-op member-owners to accomplish the greater task of creating a sustainable community grocery, together.
Membership in the co-op is obtained through the purchase of a share in the business. Unlike a publicly traded corporation, the value of a “share” does not change and the ownership of a share grants equal voting rights. Additional memberships may be purchased, but households are only granted one equally valued share.
CO-OPS ALSO HELP BUILD STRONG COMMUNITIES.
Since co-ops are owned and governed by the community they serve, they become a natural gathering place for family, friends, neighbors and colleagues. The members and leadership of the organization have a vested interest in making the community stronger and doing what is right. This foundation provides store patrons with a sense of security and they can feel confident in the quality of the food they buy here, and know the money they spend here is strengthening their community.
We will be reviewing and exploring the seven cooperative principles over the next few weeks. Stay tuned for more information and education on co-ops.
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