A co-op is an organization that takes the idea of working together and puts it into a business structure. A cooperative is a business voluntarily owned and controlled by the people who use it — its members or owners. It is operated solely for the benefit of its owners, to meet their mutual needs. When groups of people have similar needs — such as the need for lower prices, more affordable housing, or access to telecommunications services — cooperatives offer great potential to meet those needs.
At its core, a co-op is a business. It is subject to the same needs and demands of any business: co-ops require sufficient financing, careful market analysis, strategic and comprehensive planning, well-trained and competent personnel. Co-ops are not immune to the market and economic forces that cause small businesses to struggle and fail. But in several important ways, co-ops are also unique and different. Most distinctly, a cooperative business is owned by the people who use its services — the owners. Co-ops may resemble other businesses outwardly, but the fact that they are owned by the community makes them unique.
Although definitions of co-ops vary, they all contain the following elements:
- Co-ops are owned and controlled by those who use their services (the owners).
- Co-ops are democratically governed.
- Co-ops are businesses, not clubs or associations.
- Co-ops adhere to internationally recognized principles.
A simple definition of a co-op:
A co-op is a member-owned, member-controlled business that operates for the mutual benefit of all members and according to common principles established for cooperatives.
