Consumer Co-Operatives

Consumer co-operatives are enterprises owned and controlled by their members and run primarily for the mutually beneficial provision of goods or services. The most common forms of consumer co-operatives are grocery retailers, pharmacies, credit unions and banks, health and welfare co-operatives, housing cooperatives, and utility providers. Co-operatives are distinguished from normal businesses by democratic forms of governance, by equity capital not being listed, and, in the case of consumer co-operatives, by usually distributing profit in proportion to patronage. Membership is usually open and normally one member has one vote. Costs of membership may be nominal or require significant capital investment.

Organizational structures and legal forms vary, even within jurisdictions. Consumer co-operatives are as varied as “community supported agriculture” schemes, where consumers collectively buy direct from farmers; agricultural supply, services, and marketing co-operatives, commonplace in both North America and Europe; Japanese mass membership “joint buying” clubs; and renewable energy cooperatives, such as the significant Danish co-operative wind turbine sector. Innovative examples include Canada's Mountain Equipment Co-op (MEC) and Seattle-based Recreational Equipment Inc. (REI), both producers and chain retailers of outdoor clothing and sporting equipment, with membership in the millions; Co-operative Auto Network in Vancouver, a car-sharing scheme; and the UK's Phone Co-op, which provides telephone and Internet services.

Consumer co-operatives vary in scale from single retail outlets to the United Kingdom's The Co-operative Group, the world's largest consumer co-operative. As well as being the country's fifth biggest grocery retailer, it includes pharmacies, [Page 242]travel agents, funeral services, banking, insurance and investment services, as well as being the United Kingdom's biggest agricultural landowner. Mutual financial institutions have generally dominated the housing finance and life insurance markets in the United States and the United Kingdom, as well as much of the developed world.