What is a Cooperative?

Cooperatives are businesses owned and controlled by the people who use them. Cooperatives differ from other businesses because they are member-owned and operate for the benefit of members, rather than earn profits for investors. Like other businesses, most cooperatives are incorporated under State law.

In the United States there are more than 40,000 cooperatives that serve one out of every four citizens. The cooperative business structure provides farm products and supplies, insurance, credit, health care, housing, telephone, electrical, transportation, child care, and utility services. Members use cooperatives to buy food, consumer goods, and business and production supplies. Farmers use cooperatives to market and process crops and livestock, purchase supplies and services, and to provide credit for their operations.

Cooperatives Are Organized To:

  1. Improve bargaining power
  2. Reduce costs
  3. Obtain products or services otherwise unavailable
  4. Expand new and existing market opportunities
  5. Improve product or service quality
  6. Increase income