Sharing is Fun
Do you remember your Mother teaching you to share? Sharing in the profits of a coop can help build your bottom line. I like to compare a patronage dividend to a dividend paid from the profits of a commercial business. The owners of a commercial business are not necessarily involved with the business or even the industry. Chances are, they live far away and have only invested money, not blood sweat and tears, into the business and the industry as a whole. When a business owned by folks scattered far and wide has profits and dividends are declared, the dividend dollars go far and wide. It’s very likely that very little stays in the community. The return of profit to the member/customers in a coop that generated the profit keeps dollars in your hands and those of your neighbors. I have heard the comment, “Well, they charge more to start with, so it all nets out in the end.” You’ll find that with most coops, their prices are at market rates, sometimes better. The difference is, the profits stay here instead of hitting an owner who is not involved and doesn’t think about the details of profit and where it came from.
Many Shapes and Sizes
There are many businesses that operate as cooperatives. Examples: home care facilities and services, grocery stores, housing developments, utility companies like telephone companies and electric companies, certain lending and financial associations, farm elevators, chemical dealers, seed dealers, petroleum distributors, and even equipment dealers. Sometimes communities or public institutions form coops to allow for buying in large quantities to keep costs down. Names like Land O’Lakes, Ace Hardware, Ocean Spray, CoBank, Welch’s, True Value, TIP/REC, University of Iowa Credit Union, and The Piggly Wiggly are all coops kicking profits back into the hands of their customers. There are over 30,000 coops in the United States.
Consider working with a Cooperative
I am hoping you can take a couple of these ideas and consider or re-consider going into business with a coop and/or seek out more cooperative businesses. You might be pleasantly surprised to find your costs netting to something lower than they previously were.
Happy Red, White and Blue Day!!
Freedom Don’t Come Free… so… Thank a Veteran or Active Military person when you have a chance!
Susan K. Voss, CPA