What is a co-operative?
All profits are given back to the co-operative's members. These are paid to each member annually according to the proportion of business each does with the cooperative for that year.
There are several different types of co-operative, including:
Worker co-operatives are businesses which are owned and run by all the people who work there.
Employee owned businesses have many advantages for workers, especially for a relatively small business serving a local market.
The Wales Co-operative Centre can help businesses survive by supporting an employee buy-out – this means transferring business ownership to the workers.
A consumer co-operative is owned by its customers. Employees can generally also become members. Credit unions are consumer co-operatives.
The world’s largest consumers’ co-operative is The Co-operative Group in the UK; well known for its high street supermarkets, money, travel and funeral services. The Co-operative Group is also a social enterprise.
Co-operative consortia are formed when a group of businesses join together as a co-operative. They remain independent businesses, but by working together gain a competitive advantage.
They are also known as marketing or secondary co-operatives.
- Added profitability, competitiveness and sustainability
- Winning contracts through procurement
- Joint marketing of the businesses
- Sharing business resources
- Greater negotiating strength
- Adding value to products
- More control over how products are produced and sold
The Wales Co-operative Centre can help with all stages of setting up a co-operative business consortium, see working with other businesses.
A retailers’ co-operative (also known as a marketing co-operative) is a group of businesses which work together to get discounts from manufacturers and to pool marketing.
The hotel chain Best Western is a very large retailer co-operative. It operates as a non-profit membership association, with each franchisee acting and voting as a member of the association.
Co-operative social enterprises
A co-operative social enterprise is a business set up by a group of people to deliver a product or service for their community. Starting a co-operative social enterprise gives communities ownership and control over how their services are run.
These businesses use principles such as openness, honesty, social responsibility, self-help, equality and solidarity to guide the way they are set up and what they do.
The International Co-operative Alliance has described the seven co-operative principles (external website) by which co-operatives put their values into practice.
How we can help
The Wales Co-operative Centre can help with all stages of setting up a co-operative including sorting out a legal structure and registering the co-operative as a company limited by guarantee, industrial and provident society or community interest company.
We can also help with writing a business plan and provide training for people involved. For more information and to get in touch, see How we can help.
The Centre has supported farmers and food producers, retailers, scientific researchers, tourism businesses, recycling businesses and more, who have taken a co-operative approach and started working together to increase their profitability.
Examples of different types of co-operatives in the UK (external website)
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