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What are Cooperatives?

Cooperatives are Businesses

Cooperatives are businesses that—

  • are owned and democratically controlled by their members—the people who use the co-op’s services or buy its goods—not by investors.
  • return surplus revenues (income over expenses and investment) to members proportionate to their use of the cooperative, not proportionate to their ownership share.
  • are motivated by service to their members, not by profit.

Types of Co-ops

Cooperatives fall into four categories: consumer, producer, worker and purchasing/shared services.

Consumer-owned Co-ops

Consumer cooperatives are owned by the people who buy the goods or use the services of the cooperative. Consumer co-ops include credit unions, child care cooperatives, electric and telecommunications cooperatives, food co-ops, health care co-ops, housing cooperatives, and many more. Some examples include:

Amalgamated Houses, New York, N.Y.—a consumer-owned co-op providing affordable housing for 1,500 families in 11 buildings in Manhattan.

Sumter Electric Cooperative, Inc., Sumter, Fla.—one of the nation’s leading electric distribution cooperatives, which serves 125,000 consumer-owners at homes and businesses in central Florida. www.secoenergy.com

Group Health Cooperative of Puget Sound, Seattle, Wash.— a consumer-owned HMO with more than 560,000 members. www.ghc.org

Hanover Consumers Cooperative, Hanover, N.H.— a consumer-owned grocery co-op, with two stores in the Hanover area. www.coopfoodstore.coop.

Navy Federal Credit Union, Merrifield, Va. — with more than 2.4 million members, Navy FCU is the nation’s largest credit union. www.navyfcu.org

PCC Natural Markets, Seattle, Wash., — a consumer-owned grocery co-op with seven locations in the Seattle area. www.pccnaturalmarkets.coop


Producer-owned Cooperatives

Producer cooperatives are owned by producers of farm commodities or crafts that band together to process and/or market their products. Examples:

Land O’Lakes, Inc., Arden Hills, Minn.— a food and agricultural cooperative owned by 7,000 farmer-members and 1,300 local community cooperatives. www.landolakesinc.coop

Florida’s Natural Growers, New Wales, Fla. —a grower-owned cooperative that has built a nationally recognized, leading juice brand. www.floridasnatural.coop

Other well-known farmer-owned cooperatives include SunKist, SunMaid, Blue Diamond, Ocean Spray, and Riceland.


Worker-owned Cooperatives

Worker co-ops are owned and democratically governed by their employees. Examples:

Cooperative Home Care Associates, Bronx, N.Y.—a worker-owned home health care agency that provides home care providers with livable wages and benefits.

Equal Exchange, Boston, Mass.—a worker-owned, fair trade products buying and distribution cooperative that pioneered fair trade in the U.S. www.equalexchange.com


Purchasing Co-ops

Purchasing cooperatives are owned by small, independent businesses, municipalities or other like organizations that band together to enhance their purchasing power. Examples:

ACE Hardware and TruServ, Chicago, Ill.—national buying cooperatives of independent hardware store owners that use a national co-op brand.

Carpet One, St. Louis, Mo.—a national cooperative of 1,000 independent floor covering retailers that is the largest floor covering retailer in the world.

 
 

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