How do Co-ops differ from other
Cooperatives, like any other business, start with the recognition
of a need or an opportunity. Cooperatives also operate very
much like other businesses. They must serve a market efficiently
and effectively, they must be well managed, and they must
However, there are some distinctions that make co-ops unique:
- Members own their co-ops. As owners, they provide the
capital necessary for start-up and growth of the business.
- Members control their co-ops. Each member usually gets
one vote, regardless of the amount of equity they have invested
or their use of the co-op. The board of directors is elected
by the membership.
- Members benefit from their co-ops. Profits are distributed
to the members based on their use of the co-op. They also
have access to better prices and/or services.
But how are they different from other businesses?
In most cases, especially in an Investor-Owned Firm (IOF),
each investor (or shareholder) has control over the firm only
to the extent to which s/he has invested capital in it, that
is, one vote per share of stock. S/He also has no direct control
over the selection of the firm’s management/ Board of