Presentation 6 - 2013-01-09 Cooperatives

FCM International Partnership Beaumont – Koh Thom COOPERATIVES

A COOPERATIVE IS A FOR-PROFIT CORPORATION It has:

a corporate board of directors, a profit motivation, a service orientation, A cooperative is a user-owned and usercontrolled corporate business in which benefits are received in proportion to use.

User-Owner Principle: • The people who own and finance the cooperative are those who use it.

• The people who use the cooperative are those who control the cooperative. • The cooperative’s sole purpose is to provide and distribute benefits to members on the basis of their use.

• It is a fair together

way for producers to go into business

• It is a locally corporation

owned and controlled

• Its business members

purpose depends on its

History of Cooperatives •

The first modern cooperative was founded in Rochdale, England in 1844.

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Canada's first co-operative businesses were mutual insurance companies, which were established by farmers in what is now Quebec and Ontario as early as the 1830s.

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Between 1860 and 1900, dairy farmers in Quebec, Ontario and Atlantic Canada developed over 1,200 co-operative creameries and cheese factories to process their products.

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In the early 1900s, prairie grain farmers created co-operatives to sell their grain directly to millers and exporters. Other farm groups, such as fruit growers and livestock producers, also organized co-operatives in the years before the First World War.

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In the early 20th century, people worked together to create retail cooperatives in many towns in the four western Canadian provinces (Manitoba, Saskatchewan, Alberta and British Columbia).

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In the 1930s, the movement continued to expand to include the creation of credit unions, fishing and housing co-operatives, and co-operative stores

Cooperatives in the Global Economy •

Worldwide more than 1 billion people are members of cooperatives.

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Cooperatives provide 100 million jobs worldwide, 20% more than multinational enterprises.

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In India and China combined, more than 400 million people are part of cooperatives.

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In Germany and the United States, one in four people are cooperative members while in Canada that number is four in 10!

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Canadian maple sugar cooperatives produce 35% of the world's maple sugar production.

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In Vietnam, cooperatives contribute 8.6% of the Gross Domestic Product (GDP).

7 Cooperative Principles •

Voluntary and Open Membership

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Democratic Member Control

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Members' Economic Participation

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Autonomy and Independence

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Education, Training and Information

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Cooperation among Cooperatives

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Concern for Community

Cooperative Information • Foundation of Cooperatives – – – – – – –

Voluntary / open to everyone Democratic power to the members Economic participation of members Autonomy and independence Education, training and information Cooperation between cooperatives Community engagement

Cooperative Examples • Cooperatives– examples – – – – – – – –

Agriculture Arts and culture Retail Environment Finance Leisure and tourism Child care Research

Cooperative Information • Cooperative Model in Canada – Exist in different sectors • Financial • Construction • Electricity

– – – –

Owned by it’s Members Members have common needs Democratic: 1 Member / 1 vote Members share advantages

Cooperative Information • Importance of cooperatives in Canada – – – –

10 000 cooperative businesses 160 000 jobs 167 Billion in assets 15 Million members

Types of Cooperatives • Producer-owned cooperatives are owned by farmers, producers or small businesses.

• Consumer-owned cooperatives enable consumers to secure a wide array of goods and services.

• Worker-owned cooperatives are businesses owned and controlled by their employees.

What Cooperatives Do • Production – produce commodities • Purchasing – buy and sell inputs • Marketing – buy and sell commodities

• Service - Banking

What Cooperatives Do • Production – produce commodities • Purchasing – buy and sell inputs • Marketing – buy and sell commodities

• Service - Banking

Production Cooperatives Production cooperatives are sharing resources to produce a commodity for sale. • • • • • •

feeding cattle grazing agricultural machinery, animal reproduction, forestry handicraft

There are 603 production cooperatives in Canada

What Cooperatives Do • Production – produce commodities • Purchasing – buy and sell inputs • Marketing – buy and sell commodities

• Service - Banking

Purchasing Cooperatives

• Purchase supplies –operate farm supply store (retail) South Country Co-op UFA

–joint purchasing programs (wholesale) Federated Co-operative

Purchasing Cooperatives • Allow those buying the goods to receive benefit from sales as profits are shared with all the members. • The more you support and buy goods from the cooperative, the more return you receive. • Retail co-ops can sell many different things and are particularly strong in the farm input sales giving producers better prices and more access.

Cooperatives - Retail Sell many different things

Food

Tires

lumber

hardware and tools

petroleum

agricultural inputs

Agricultural Co-ops • farm inputs including fertilizers and chemicals, animal feed, seed, building materials and petroleum products. • The 216 supply co-operatives have nearly $5 billion of all farm supply market share.

What Cooperatives Do • Production – produce commodities • Purchasing – buy and sell inputs • Marketing – buy and sell commodities

• Service - Banking

Marketing Cooperatives • Market products –acquire and sell commodities Gay Lea Foods in dairy Exceldor in poultry slaughtering and processing Grain marketing

–bargain for price, terms of sale –151 marketing cooperatives in Canada

Agricultural Marketing Cooperatives • processing and marketing – – – – – – – –

grains and oilseed, dairy products, poultry, fruits, vegetables, livestock, honey maple products.

What Cooperatives Do • Production – produce commodities • Purchasing – buy and sell inputs • Marketing – buy and sell commodities

• Service - Banking

Service Cooperatives • Largest number of cooperatives are in this area • Provide needed member services Banking – Credit Unions Water supply Insurance Housing Day cares and nurseries Health care Funeral services Management of facilities

Key Organizations

• International Cooperative Alliance (ICA) The International Cooperative Alliance is an independent, non-governmental organisation which unites, represents and serves cooperatives around the world. http://www.ica.coop/al-ica/ • World Council of Credit Unions WOCCU is the global trade association and development agency for credit unions. http://www.woccu.org/

Cooperative Information

• Advantages of Cooperatives – – – – – – –

Economic and social growth in communities Creates more employment opportunities Possibility to change something that’s not working Better access to products and services Strong customer loyalty Access to new markets Bring solutions to problems

Cooperative Information • Process of Cooperatives – – – –

Mobilize people around one project / need Share information and promote the movement Support to start of new cooperatives Work with the community

Steps to Organize • • • • • •

Determine what groups would benefit the most from a co-op in your area. Hold exploratory meeting with potential members Analyze the market Evaluate the feasibility – discussion with other organizations who have experience in such organizations. Prepare a business plan Implement the business plan

Thank You / aw kohn

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