Cooperative is a term used to describe a business, organization or association that operates for the benefit of its members, who are also the owners. The members pool their resources (usually finances) and share in the risks, benefits and profits. In essence, cooperatives operate on the principle of joint ownership, mutual support, and shared responsibility.
Some features of cooperative businesses may include:
Joint ventures are formed between two or more companies to carry out a specific business project or objective. The companies involved share the costs, risks and profits of the venture. Joint ventures are popular in industries such as real estate development, tech startups or mining.
Partnerships refer to agreements between two or more individuals who come together to start a business. In this case, each partner contributes financial resources equally to the startup capital of the business. Partnerships can be general partnerships (where all partners share equal responsibility and liability) or limited partnerships (where one partner has more control than others).
Cooperative advertising involves two or more businesses sharing advertising costs for a single promotion. In this case, each participating entity shares in the cost of producing promotional materials while promoting their individual products as well.
There are various examples of cooperatives in different industries including:
Cooperatives offer several advantages to their members including:
Cooperatives also have a positive impact on communities by:
Starting a cooperative requires careful planning and consideration of legal and financial requirements. Some steps involved in starting a cooperative include:
