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Why Co-ops?

Why Co-ops? LEARN MORE HERE.

What is a Cooperative (Co-op)?

The International Cooperative Alliance officially defines a co-op as an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly owned and democratically controlled enterprise.

Members of a cooperative support it with their patronage, participate in decision-making, and share in the profits generated by the organization’s activities.

History of the Cooperative Movement

Today’s cooperatives trace their origins to England’s Industrial Revolution. In the first half of the nineteenth century, living conditions were extremely harsh for working class people in the textile milling towns of northern England. Mills workers labored long hours under dangerous working conditions for low pay. Plagued by unending poverty, they were forced to buy food on credit from merchants who charged high prices for goods that were poor quality and often adulterated. Owning no property, workers were unable to vote. These conditions gave rise to labor movements, which drew great numbers of followers.

During this period, cooperative initiatives were common, offering their working class members the promise of economic opportunity and democratic control. But until the founding of the Rochdale Equitable Pioneers Society in 1844, none were successful. When the self-described "Rochdale Pioneers" opened their first cooperative food shop, they sold only five products—butter, flour, oatmeal, sugar, and candles—but promised to provide members with "purest provisions, giving full weight and measure." They went on to establish many other member-owned businesses.

Cooperative Values

Cooperatives are based on the values of self-help, self-responsibility, democracy, equality, equity, and solidarity. In the tradition of their founders, cooperative members believe in the ethical values of honesty, openness, social responsibility, and caring for others.

Cooperative Principle

The founders of the Rochdale Society developed a series of operating principles, which ensured their success and the success of hundreds of cooperatives in England and beyond. Today, these basic principles still guide cooperatives around the world.

1st Principle: Voluntary and open membership
Cooperatives are voluntary organizations, open to all persons able to use their services and willing to accept the responsibilities of memberships, without gender, social, racial, political, or religious discrimination.

2nd Principle: Democratic member control
Cooperatives are democratic organizations controlled by their members, who actively participate in setting their policies and making decisions. Men and women serving as elected representatives are accountable to the membership. In primary cooperatives members have equal voting rights (one member, one vote) and cooperatives at other levels are organized in a democratic manner.

3rd Principle: Member economic participation
Members contribute equitably to, and democratically control, the capital of their cooperative. At least part of that capital is usually the common property of the cooperative. They usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any of all of the following purposes: developing the cooperative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the cooperative; and supporting
other activities approved by the membership.

4th Principle: Autonomy and independence
Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.

5th Principle: Education, training and information
Cooperatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their cooperatives. They inform the general public—particularly young people and opinion leaders—about the nature and benefits of cooperation.

6th Principle: Cooperation among cooperatives
Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional, and international structures.

7th Principle: Concern for community
Cooperatives work for the sustainable development of their communities through policies approved by their members.

Twin Pines Emblem of Cooperation

Dr. James Peter Warbasse, who wrote about the implications of cooperation and believed strongly in the co-op movement, created the twin pines emblem for use in the United States. In describing the significance of this symbol, he said: The pine tree is the ancient symbol of endurance and fecundity. More than one pine is used to signify cooperation. The trunks of the trees are continued into roots, which form the circle, the ancient symbol of eternal life, typifying that which has no end. The circle represents the all-embracing cosmos, which depends on cooperation for its existence. The two pines and the circle are dark green, the chlorophyll color of human’s life principle in nature. The background within the circle is gold, typifying the sun, giver of light and life. The twin pines symbol isn’t as common in the United States as it once was, since many co-ops have replaced it with their own logos. However, this symbol is still frequently used by co-ops in other countries, especially throughout Central America, in India, and in other developing regions.

Types of Co-ops

Cooperatives are often formed to provide their members with goods and services or economic benefits not provided by the marketplace. Thus, co-ops operate a wide variety of businesses. All are owned and run by the people they serve. Here are a few examples:

Rural Utility Co-ops have played an important role in serving the needs of rural Americans. Electric co-ops have brought power to over 80% of the land area of the United States, and provide water and sewer services to many rural areas. Telephone cooperatives have brought new communication technologies to many people.

Credit Unions provide banking and credit services to over 71 million members in the United States.

Housing Co-ops are home to students, seniors, city dwellers, mobile home park residents, minorities, the handicapped, single parents, and others. Some for whom home-ownership would be out of reach find it possible through a housing cooperative.

Agricultural Co-ops offer individual farmers greater clout in the marketplace by acting as their buying and selling agents. Agricultural supply co-ops allow farmers to purchase supplies at competitive prices, while agricultural marketing co-ops market farm crops and manufacture value added products. They include such well-known names as Cabot, Sunkist, Ocean Spray, Land of Lakes, and Blue Diamond.

Worker Co-ops are owned and controlled by their employees. Worker cooperatives may be found in almost any industry, from restaurants and bakeries to printers and taxi cab companies.

Consumer Co-ops, like the Keweenaw Co-op, may operate food stores, pharmacies, clothing and sporting goods outlets, book stores, service stations, hardware and agricultural supply stores, and other retail businesses.

Ownership is achieved by purchasing a share in the business and exercised by patronizing the store and voting. The membership elects its board of directors to hire, guide and evaluate the management, which is in charge of running the operation of the business.

Consumer cooperatives are very different from privately owned discount clubs, which charge an annual fee in exchange for a discount on purchases. This is a marketing device that is quite successful at capturing repeat business. However, the club is not owned or governed by the "members" and the benefits of the business go to the investors based on their investments.

The overall goal of the cooperative movement is to create organizations that serve the needs of the people who use them. In this way, cooperative business can serve as an alternative to the excesses of runaway capitalism, provide goods and services that private industry doesn’t perceive a market for (such was the beginning of the natural food cooperatives), and use our collective resources for the good of the whole community.

 
 

 

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Hancock, MI 49930

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