Wednesday, March 6, 2019

Why haven’t consumer food buying cooperatives been as successful as farmer cooperatives?

Consumer cooperatives are organized by consumers that want to achieve better prices or quality in the goods or services they purchase. Opposite to the traditional retail stores or service providers, a consumer cooperative exists to deliver goods or services rather than to maximize profit.
Nationally, the most widely used co-op form is the credit union, with some 90 million members. Credit union assets have grown a hundred-fold in three decades.  Credit unions are essentially cooperatives of people that use banking services.
Other common types of consumer cooperatives include grocery stores (food coops), energy-buying cooperatives, schools, health care cooperatives, insurance cooperatives, and housing cooperatives.
Farmer cooperatives are businesses owned and controlled by farmers, ranchers or growers. By their cooperatives, farmers are empowered, as elected board members, to make decisions. When a farmer joins a cooperative, they benefit through earnings returned on a patronage basis.

For example, a farmer-member who accounts for 10 percent of the volume of milk delivered to the cooperative would receive 10 percent of the net earnings derived from the handling, processing, marketing and sale of that milk or related products. Such patronage dividends help boost the income of farmers directly.

Through their cooperatives, farmers are able to:

       Improve their income from the marketplace
       Strengthen their bargaining power
       Maintain access to competitive credit sources
       Compete effectively in the global economy
       Capitalize on new marketplace opportunities, including value-added processing
       Manage risk
       Access technical assistance and other services
There are more than 3,000 farmer cooperatives throughout the United States, whose members include a majority of our nation’s 2 million farmers.



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