What you might not realize about co-ops
By Kipp Sienna Hopkins
Co-ops are all around us, from your local food co-op to the credit union down the street, or the worker-owned farm that produced the carrots on your table. But what exactly is a co-op? There are some things that you might find surprising about this resilient and increasingly popular business model.
Co-ops, or cooperatives, are businesses where a group of people pool their money and resources together to create a venture that will benefit all. Co-ops are democratically run, so members of the co-op have an equal vote on matters of governance and electing the Board of Directors. One member, one vote. In this way, the people using the co-op have a say in the direction of the business and benefit in its success, rather than decisions being made by an owner or shareholders who might be removed from the customers and workers.
Because of this, co-ops are more invested in their community, keeping money and jobs local. For example, there are more than 35 food co-ops and startups in New England providing more than 2,300 local jobs in their communities. On average, 60% of co-op employees are also members. New England food co-ops generate about $340 million in shared annual revenue. And, according to Neighboring Food Co-op Association, about $93 million of that is in local products.
Co-ops, because of their collaborative nature, are more resilient to hard times. Members share in the profits of their cooperatives and limit the losses, pulling together during tough periods so the businesses can survive. Co-ops are often more successful in impoverished communities than traditional businesses.
Many cooperatively-run organizations help support and promote co-ops around the country. These co-ops’ members are other cooperatives. For example, the Blue Hill Co-op and many other Maine food co-ops are members of National Coop Grocers (NCG), a business services cooperative for retail food co-ops located throughout the United States. NCG represents 148 food co-ops operating more than 200 stores across the country.
Cooperatives don’t run solely for profit. The first commercially successful co-op was founded in Rochdale, England in 1844. The Rochdale Society of Equitable Pioneers was founded by a group of factory workers who pooled their resources to open a store that would allow their members to purchase necessities such as grain and candles for reasonable prices. They set down the principles to which almost all modern co-ops still adhere today: Those seven principles are as follows: voluntary and open membership; democratic member control; member economic participation; autonomy and independence; education, training and information; cooperation among cooperatives; and concern for community.
The business model blossomed from there, and today one out of every three Americans is a member of a co-op or credit union. There are more than 40,000 cooperatively-owned businesses in the United States and 169 (and counting) in Maine. Nationwide, cooperatives create 2.1 million jobs and generate more than $650 billion in sales and other revenue annually, according to the Neighboring Food Co-ops Association. A co-op can have thousands of members or just a few. There’s no right way to be a cooperative. They are flexible enough to fit different needs.
Maine Co-ops
According to the Cooperative Maine Directory, Maine is home to 169 cooperative- and employee-owned enterprises. They represent food producers and distributors, housing, professional and home services and much more. Find a directory of Maine co-ops and learn more at maine.coop.
Kipp Sienna Hopkins is the Marketing Manager of the Blue Hill Co-op, which was incorporated as a co-op in 1979 and has over 2,000 members.
This article appeared in the 2020 Green & Healthy Maine Winter Guide. Subscribe today!