After all this fanfare about the car-coop, the question is… what exactly is a cooperative? The International Cooperative Alliance (ICA) defines a coop as “an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.” Did you feel that heart warming sensation too? And just wait, it gets better. A cooperative is based upon 7 principles:
1) Voluntary and Open Membership
2) Democratic Member Control
3) Member Economic Participation
4) Autonomy and Independence
5) Education, Training and Information
6) Co-operation among Co-operatives
7) Concern for Community.
This list is all well and good. But what really differentiates a coop from a membership based retailer?
Costco Vs. Coop
Until recently, I was sure Costco was a co-op. But what separates membership based corporations from say a cooperative Car-Coop are the 7 principles. When you buy a $400 membership at the Car-Coop, you’re buying shares. Yes, your money not only goes directly into getting what you want—convenient and affordable transportation— but also gives you the opportunity to vote on how the Car-Coop is run. Your membership to Costco does not buy you shares in Costco.
Another big difference: A Costco shareholder’s number of votes depends on the number of shares they hold. Everyone who is a part of a coop usually has only one share and only one vote. Also, while Costco is a publicly traded company and their shares depend on the market, the Car-Coop’s shares are bought through membership and prices are set by the coop. Already we see principle 2 and 3 at work.
"Coop"-eration
How about the principle of cooperation. While a store like Costco is a business competing with other like businesses, the Car-Coop forges alliances with other cooperatives. Case and point: the alliance between the Vancouver, Revelstoke, and other car-shares with the Victoria Car-Share. Rather than competing for business, they are working together to provide more accessible and convenient services for its members. This does not mean that a cooperative is not a competitive business model. It does make a profit in order to sustain the services it provides. However, a cooperative model seems to recognize that sustainable and productive growth that benefits its members can come from a combination of marketing and cooperation.
A Cooperative by definition also engages in community education and community support. The nature of the coop itself is that of community. It brings people together, gives people an equal voice in the running of the coop and strives to make connections with other cooperatives. The car-coop, by its very nature, teaches people about conservation, resource use reduction, cooperation, and community. Often cooperatives will also engage in other community activities outside of the cooperative, much like responsible businesses do as well.
A Couple Of Coop Options
As a viable business model, the cooperative seems to work. The Car Coop is constantly expanding, making new connections, increasing its fleet of cars and its membership base. Another case and point— just look at the Mountain Equipment Coop. You purchase a $5 membership (one share in the company) and you have one vote in how the coop is run and you know that your purchases (of the membership and products) go towards providing you continuous access to quality products at a reduced price. And at the end of the day, you can be rest assured that the Mountain Equipment Coop is a strong business and here to stay. What makes me so sure? Their huge base of members, constant revenue, and their smart and ethical business practices (but that's a whole separate post in and of itself).
Other co-operatives have been formed by people not quite satisfied by the services they receive from private business models. For example, there are health cooperatives popping up here and there. The Victoria Community Health Cooperative seeks “to offer integrative, primary health care education and services that are accessible to all Victorians through membership with, and participation in” the cooperative. The cooperative takes the approach that individuals should have a say in the management of the organizations providing health assistance and should have affordable access to integrative and holistic health options if they choose to use them. Ownership over how your health care system is run… maybe it’s not such a bad idea on a certain scale...
What do you think about the cooperative model? What does or does not make it a good business model? And for you Americans, what do you think about this idea of health cooperatives? These marmots don’t know a whole lot about them yet, but they can do some digging for sure.
Thanks for reading! Happy Greening!
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In the United States Health Coops have been promoted by conservatives as an alternative to a single payer system. Unfortunatly they have been promoting coops because they are doomed to failure due to the high cost of health care. For example some treatments may cost one millions dollars which would drive a small coop out of business. This is a sly strategy by conservatives to retain the for-profit system which enriches their campaign war chests. Insurance per say spreads the risk from an individual to a large group of people. That group must be large enough to withstand a major catastrophic illness to an individual. Coops will have difficulty getting large enough to compete with the United Health Care's of the world.
ReplyDeleteUnlike the United States, Canada has universal primary health care coverage. A health coop for elective plastic surgery for Kitty Hotpants might make sense, and might work in Canada. Coops for primary health care do not have a good track record of succeeding.
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