Co-Ops

There are many types of cooperatives out there – models of organization that have been around for centuries upon centuries. Black Coffee is amongst perhaps the rarest variety, the worker cooperative, and is one of only a handful of worker co-ops in Seattle. For urbanites, more commonly known cooperatives are financial co-ops, like credit unions, and consumer co-ops, like community owned grocery stores. Here’s a breakdown of the major types of co-ops:

Worker Cooperative

worker cooperative is a cooperative owned and democratically managed by its worker-owners. This control may be exercised in a number of ways. A cooperative enterprise may mean a firm where every worker-owner participates in decision making in a democratic fashion, or it may refer to one in which managers and administration is elected by every worker-owner, and finally it can refer to a situation in which managers are considered, and treated as, workers of the firm. In traditional forms of worker cooperative, all shares are held by the workforce with no outside or consumer owners, and each member has one voting share. In practice, control by worker-owners may be exercised through individual, collective or majority ownership by the workforce, or the retention of individual, collective or majority voting rights (exercised on a one-member one-vote basis).[1] A worker cooperative, therefore, has the characteristic that the majority of its workforce own shares, and the majority of shares are owned by the workforce.[2]

Housing Cooperative

housing cooperative is a legal mechanism for ownership of housing where residents either own shares (share capital co-op) reflecting their equity in the cooperative’s real estate, or have membership and occupancy rights in a not-for-profit cooperative (non-share capital co-op), and they underwrite their housing through paying subscriptions or rent.

Housing cooperatives come in three basic equity structures:

  • In Market-rate housing cooperatives, members may sell their shares in the cooperative whenever they like for whatever price the market will bear, much like any other residential property. Market-rate co-ops are very common in New York City.
  • Limited equity housing cooperatives, which are often used by affordable housing developers, allow members to own some equity in their home, but limit the sale price of their membership share to that which they paid.
  • Group equity or Zero equity housing cooperatives do not allow members to own equity in their residences and often have rental agreements well below market rates.

Consumer Cooperative

Consumer cooperatives are enterprises owned by consumers and managed democratically which aim at fulfilling the needs and aspirations of their members.[1] They operate within the market system, independently of the state, as a form of mutual aid, oriented toward service rather than pecuniary profit.[2] Consumers’ cooperatives often take the form of retail outlets owned and operated by their consumers, such as food co-ops.[3] However, there are many types of consumers’ cooperatives, operating in areas such as health care, insurance, housingutilities and personal finance (including credit unions).

In some countries, consumers’ cooperatives are known as cooperative retail societies or retail co-ops, though they should not be confused with retailers’ cooperatives, whose members are retailers rather than consumers.

Consumers’ cooperatives may, in turn, form cooperative federations. These may come in the form of cooperative wholesale societies, through which consumers’ cooperatives collectively purchase goods at wholesale prices and, in some cases, own factories. Alternatively, they may be members of cooperative unions.[4]

Consumer cooperation has been a focus of study in the field of cooperative economics.

Financial Cooperative

Cooperative banking is retail and commercial banking organized on a cooperative basis. Cooperative banking institutions take deposits and lend money in most parts of the world. Cooperative banking includes retail banking carried out by credit unionsmutual savings banksbuilding societies and cooperatives, as well as commercial banking services provided by mutual organizations (such as cooperative federations) to cooperative businesses.

Credit unions are cooperative financial institutions that are owned and controlled by their members. Credit unions provide the same financial services as banks but are considered not-for-profit organizations and adhere to cooperative principles.

Agricultural Cooperative

Agricultural cooperatives or farmers’ cooperatives are cooperatives where farmers pool their resources for mutual economic benefit. Agricultural cooperatives are broadly divided into agricultural service cooperatives, which provide various services to their individual farming members, andagricultural production cooperatives, where production resources such as land or machinery are pooled and members farm jointly.[32] Agricultural production cooperatives are relatively rare in the world, and known examples are limited to collective farms in former socialist countries and thekibbutzim in Israel.