A co-op is an organization that is owned and democratically controlled by its members and is designed to meet its members' needs, by providing goods or services to its members. In a co-operative, people work together for a common goal or purpose. The members of co-ops use the services or products of the co-op and control what the co-op does. All co-operatives also embody the 7 international co-operative principles.
There are many different kinds of co-ops, and there are about 1,200 co-ops and credit unions in Saskatchewan.
What is a Credit Union?
A credit union is a financial co-operative owned and controlled by its members. Credit unions provide financial services similar to banks and trust companies (such as savings and chequing accounts, term deposits, mutual funds and loans). A credit union is composed of people who have a “bond of association” that provides the basic criteria for membership. Many credit unions exist because the members share a common interest as a community, employee group, church or cultural association.
Why Do People Form Co-ops?
- Because people feel no power in the marketplace. Private businesses are mostly concerned with their own profit, so they sometimes ignore the needs and wants of the customer. The customer has very little power to change or improve things. In a co-operative, members are the owners. They control the co-op. They have the power.
- Because no one is providing a service they all need. By getting together to form a co-operative, they can provide themselves with that service.
- Because their jobs or their communities would disappear if they did not join together to save them. Often a business will close down for good “business reasons,” but not for good “people reasons.” In a co-operative, people are the business. The people involved in the co-operative work for the benefit of the co-operative, and their community.
- Because they want to keep the control and profits of a business in the community. Often a business is owned by people who never use its services. They may never even see the business, but they benefit from it. A co-operative is locally owned and controlled, and the profits stay in the community.
Co-ops are formed to serve different types of needs:
A co-op can provide goods to its members – like a food store, or farm equipment supply store. A co-op can provide a service to its members – like a community health clinic, or a childcare co-op. Co-ops can serve other needs – like credit unions, where members do banking, or a worker co-op, where the workers own the business.
Where do the 'profits' go?
In for-profit co-operatives, part of the profits are given back to the members, based on how much they have used the co-op. Because co-ops are owned by their members and part of the profits are given back to them, more money comes back to the members of co-ops (and the communities they live in). Also, when something is bought at the co-op, members sometimes pay less than non-members.
In not-for-profit and community service co-operatives, surpluses are reinvested back into the organization and when/if the co-operative dissolves, the assets are given to another community services co-operative or not-for-profit.
"Introduction to Co-operatives" is a pre-recorded webinar which defines co-operatives, gives an overview of the types of co-operatives, introduces the core principles of co-operatives and discusses the difference between co-operatives and other types of businesses. Perfect for the general public interested in learning more about co-operatives and people newly involved in co-ops, the webinar is only $15 and can be viewed any time. Visit our webinar page to register.