Developing a Co-op

Developing a co-op, by Russ Christianson.

Excerpt:

Introduction

Co-operatives are a well-proven model for doing business and providing for people’s needs.  They have a very successful track record in Canada, with nearly fifteen million members of co-ops, credit unions and caisses populaires.

Why Form a Co-op?

This, of course, is the key question.  What are the reasons people form co-ops instead of regular corporations?  In many ways, co-ops are similar to any business corporation:

  • Like corporate shareholders, members of co-ops enjoy limited liability.
  • Co-ops can and do operate in every sector of the economy.
  • Like any business, co-operatives have to meet the needs of their customers (members) to survive and prosper.
  • Co-ops and corporations are viewed as “natural persons” under the law, and are therefore able to enter into contractual arrangements.
  • Like any business, co-ops need to generate more cash than they spend.
  • Co-op’s day-to-day business operations are professionally managed like any other business.
  • Every province and the Canadian government have legislation that regulate co-operatives and corporations.
  • Co-ops can be either for profit or non-profit organizations.

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Developing a Co-op