What is a Co-op?
by Bonnie Schellinger, Former MEC Trustee
How many of these products sit on the shelves in your kitchen? Welch's Grace Juice, Blue Diamond Almonds, Sunsweet Prunes, Ocean Spray Cranberries, Sunkist Citrus Fruits, Donald Duck Juices, Long Island Duck, C&H Sugar, Land O'Lakes Butter and Cheese, Norbest Turkey, Tree Top Juices or Sun-Maid Raisins. If so, the food products you are serving are brands owned by farmer cooperatives.
The tastiness of Welch's Grape Juice is well known, but have you ever heard of the National Grape Association of Westfield, N.Y.? National is a cooperative which was formed by grape growers to process and market their products. The popular grape juice and soft drinks are one way cooperatives get the job done. There are about 100 farm cooperatives that own more than 300 brand names for processed drinks, meat, vegetables, fruits, bread, desserts and canned, boxed and frozen foods.
Land O'Lakes is a farm cooperative which has several hundred dairy and poultry products carrying its brand name. Other cooperative products are the small packages of Blue Diamond Almonds, Sun-Maid Raisins or Sun Sweet Prunes which are served as snacks aboard many commercial airlines. Not only do cooperatives provide food, electrical and phone services, but also health and legal services, savings and lending services and housing complexes. The Washington, D.C. Watergate complex is a well known example of a housing cooperative. There are many other such complexes in New York City.
The famous Glen Gray Casa Loma orchestra is another example of a co-op. In addition, there are tennis cooperatives, baby-sitting cooperatives and purchasing cooperatives. The Associated Press is an example of a news gathering cooperative. It was founded by the owners of the biggest daily paper in the country to organize their own news. The common thread among all of these examples is that the members are shareholders who participate in control of earnings.
In 1884 a group of disgruntled weavers gathered together in Rochdale, England because they were tired of high prices they were paying for poor quality food. Each contribute a small amount of money to a fund, rented a building, bought supplies and began a business. This cooperative was a tremendous success because the people in Rochdale were able to consistently buy the goods they needed at a fair price.
Students learn about the democratic form of government in school. However, students fail to learn about cooperatives as a democratic form of business. A cooperative is set up by a business or a group of people needing goods or services. It serves its members or consumers at cost and is financed by those who benefit from it. The control of the cooperative is by each member having one vote. By giving each member one vote in the operation of the business there is more popular control than most economic institutions. The members also maintain control of the business by being able to elect their own Board of Directors. These board members, who must also be cooperative members, determine policy.
Cooperatives differ from other businesses in that they are owned by their workers or user-members. The profits are returned to members according to use. The similarities between cooperatives and businesses are that they both produce and provide service as well as pay taxes. There are producer cooperatives where the workers are the member owners; there are consumer cooperatives where the users are the member owners, like Missoula Electric Cooperative, Inc. In an investor-owned corporation, the people who have the most investments have the most votes. Therefore, those with the most investments have the most to say about what the business does and what happens with its money. The people with less money have fewer shares and votes and thus less power.
Most businesses or organizations have a symbol to convey the ideas of their movement. According to the Michigan Alliance for Cooperatives there are two symbols widely recognized and used by cooperatives in the United States and around the globe. The symbol of the United States cooperative movement is two green pine trees within a circle against a gold background. The pine tree is an ancient symbol of endurance and productivity; more than one pine signifies cooperation. On this emblem, the trunks of the trees continue into the roots forming a circle which symbolizes the universal interconnectedness of us all. The seven colors of the rainbow flag represents "Unity in Diversity." The flag was adopted by the International Cooperative Alliance in 1921 to show that although each nation is different, cooperatives are united around the globe because they work for social and economic equality, justice and world peace.
Today more than 60 million Americans are members of 40,000 cooperatives. They belong to these cooperative for a variety of reasons but mainly for mutual gain. The cooperatives are found in urban, suburban and rural areas, all over the country. The earnings are returned only to the members. A member of the cooperative expects to receive products or services that best meet his or her need at the lowest possible cost. Members own and control the business. The course of the business is set by members through election of the Board of Directors. Members have the right to serve on a committee or seek election to the board.
Through time, cooperatives have emerged wherever there is a common need to be met through group effort. They traditionally delivered services that no other private enterprise is willing to provide. Cooperatives must have leaders who can look into the future and gain the support and trust of others.