H t E t bli h C ti

H to
How
t Establish
E t bli h a Cooperative
C
ti
3rd Annual USDA Outreach Conference
Virginia State University
Petersburg Virginia
Petersburg,
March 18, 2010
Bill Brockhouse
USDA/Rural Development
Cooperati e Programs
Cooperative
Washington, DC
Purpose
• What Are Cooperatives?
• Advantages and Disadvantage
• Development Steps
2
What Is A Cooperative?
A business
• Owned and democratically controlled by the
people who use its services
q
y to them
• With benefits distributed equitably
based on use
3
What Is A Cooperative?
Purpose
• Obtain market access or broaden market
opportunities
p
product
p
or service qquality
y
• Improve
• Reduce costs (purchasing)
4
What Is A Cooperative?
Extension of grower’s farm
• Cooperative enhances farming operation
• Growers own their cooperative.
• Lack of support for the cooperative means
failure.
5
Advantages of Cooperatives





User members drive business
User-members
Patronage-based benefits
Market access
Capital pooling
Structure - Easy for large numbers of
members to use
Disadvantages of Cooperatives

Members have to give up some independence

Time to develop

Group decision-making

Everyone
y
needs to commit to the cooperative
p

Voting board members have to be producers

B d v. manager responsibilities
Board
ibiliti
Cooperative Development Steps
• Meeting to define economic need/opportunity
• Exploratory meeting
– Potential members
– Steering committee/leadership
– Education
Ed ti about
b t cooperatives
ti
• Survey potential members
8
Cooperative Development Steps
•
•
•
•
•
Feasibility study
Business plan
p
Legal documents
Business startup
Board education
9
Bill Brockhouse
U.S.
U
S Department of Agriculture
Rural Development
Rural Business
Business-Cooperative
Cooperative Service
Cooperative Programs
Washington, DC
bill.brockhouse@wdc.usda.gov
Phone: (202) 720-2021
720 2021
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