A co-operative is where a number of individuals or businesses work together
to achieve a common purpose.

They are normally formed so individuals and small businesses can benefit
from being part of a larger group, meaning they have more power to buy or

There are three main types of co-operatives:

Retail co-operatives
Marketing or trader co-operatives
Worker co-operatives

A retail co-operative is probably the most familiar co-op. The Co-Op shops
are a regular sight in the high street.

Objectives of a co-op

The objectives are normally more focused on the members of the
co-operative, the local community and the world community. Though profits
are required to enable them to reinvest in their business, they will not be the
main objective.

Problems faced by co-operatives

The system of one member one vote in some societies means a long, drawn
out decision-making process

Co-operatives may find it difficult to raise finance since banks are not so
willing to lend them money because their main aim is not to make a profit

Idealistic and ethical aims may not be agreeable with all members, so
creating unrest and disharmony

The aims held by many co-operatives may not lead to profits in the long run
(though many co-op shops will continue to exist at a loss because the
owners feel they are providing an important service to the community.)