The cooperative model works well in many situations, but it always starts with a group of people who decide to provide certain goods or services for themselves. Often, this is after concluding that they cannot get the quality, quantity, or price they desire from somewhere else. Key to the cooperative model is an identifiable need which participants recognize and are willing to support financially. Underlying any cooperative is the shared recognition of a common need. Cooperatives can meet that need if their members are willing to participate, utilize the services of the cooperative, and provide financial support to the cooperative.
In addition, cooperatives provide broader benefits to the communities they serve by:
Establishing Local Control
Because they are owned by people who live here, cooperatives are a powerful way for our communities to have control over economic, social, and cultural activities that affect the lives of community members.
Creating Jobs and Opportunity
People who couldn’t start a business on their own may be able to build a cooperative business with others, because costs as well as the benefits are shared. Communities may also invest directly in locally-owned cooperative businesses, and support cooperatives by buying from them.
Keeping Money in the Local Community
Local cooperatives use and create local wealth, since cooperative owners spend money in the community. Every dollar invested in a local cooperative has a significant multiplier effect for the community.
Meeting Community Needs
Cooperatives can help meet needs in the community that would be difficult for people to attain on their own, by pooling purchasing power or investing as a community in cooperatives which provide needed goods and services.
Building a Stable Local Economy
Cooperatives tend to be loyal to their communities, because they are owned and controlled by local people. They are less vulnerable to closures, because the owners of the business live here and benefit from the cooperative. In many communities, cooperatives have stayed to serve their members, or taken the place of other businesses that left for more profitable places.
Supporting Local Business Sustainability
Cooperative businesses also have a higher survival rate than private businesses, and tend to weather economic crises better. In the first five years, cooperatives have a 64% survival rate compared to 36% for private businesses. Over ten years, the figures are 46% survival rate for cooperatives, compared to 20% for private businesses.
Helping Other Cooperatives
Cooperatives tend to make donations to community causes and are committed to helping other cooperatives, so over time individual cooperative business can become a thriving cooperative economy, controlled and employing local people and meeting local needs.
Promoting Community Health
In places that have a high number of cooperatives, people trust each other more and feel they can call on more people when they are in trouble, wealth is shared more equally, and people even live longer, perhaps due to lower stress and confidence in mutual support.