Do you have a project with an economic and social vocation? The cooperative model marries democracy and efficiency, equity and competitiveness. As such, the consumer cooperative can be a beneficial legal framework for a network of customers who want a say in the services or products they buy.
A consumer cooperative can be defined as a business whose main purpose is to provide goods and services to its members for their personal use. This type of cooperative is also a solution for revitalizing communities that want to make services available locally. These co-ops can be found in a variety of sectors, including food, housing, school goods and services, cable TV and funeral services.
Today, there are more than 1,500 consumer cooperatives in operation in Quebec. They act as a shield against inflation, since their commitment not to pursue profit at any cost means they guarantee competitive prices. Found across the province, these cooperatives are especially successful outside major cities to maintain essential local services. Let’s take the example of a village grocery or hardware store. Have you heard of Ici Coop? This network is a federation of over 75 consumer cooperatives that operate grocery stores under various banners or as independent businesses.
A well-known consumer cooperative is the COOPSCO network of school-based cooperatives. They mainly sell school supplies, books, IT equipment and other products for students. COOPSCO members are generally the students enrolled in participating educational institutions, such as CEGEPs and universities. Not only do these cooperatives offer school products and services at competitive prices, they also play an active role in student life by organizing events and activities. In short, COOPSCO is an example of a consumer cooperative that meets the needs of a specific demographic group while implementing the cooperative principles of democratic participation and collective benefits.
In Quebec, housing cooperatives are an interesting example of consumer cooperatives. These co-ops are crucial to protecting significant real estate assets from speculation, which is particularly important in the current housing shortage. Since the 1970s, over 1,000 housing cooperatives have been launched in Quebec, mainly in the form of continuing, non-ownership cooperatives. This structure fosters access to quality housing while also allowing members to be decision-makers in regard to their living environment.
The members of this type of co-op are users who come together to acquire products or services at a lower cost or better quality. They share needs and interests. Since they are collective owners of the organization, they must have access to the services the cooperative offers. It should be noted that the legislation on cooperatives stipulates that a minimum of five people is required to form this type of collective enterprise.
The consumer cooperative is also characterized by threefold member participation:
So, what really distinguishes consumer cooperatives from private companies in the same business sector? Most important is the value received by the owners. A private business owner generally seeks to maximize the return on their capital investment. Members of a consumer co-op, however, contribute capital to benefit from goods and services that meet their needs at a better price-quality ratio.
Consumer cooperatives offer their members many advantages:
By pooling purchases, consumer cooperatives allow their members to benefit from economies of scale. Through these bulk buys, they can obtain reduced prices on products and services, and that translates into savings for members.
Consumer cooperatives offer their members a choice and a quality of products or services that is centred on members’ needs and preferences.
Each member of a consumer cooperative has an equal voice in decision-making. Members also take part in general meetings and have the right to vote on important cooperative matters.
Consumer cooperatives redistribute surpluses to their members in the form of discounts, dividends or other economic benefits. This fair redistribution of profits strengthens the member–cooperative bond.
The liability of members is limited to the amount of their investment in the co-op. In other words, members are not personally liable for the cooperative’s debts or obligations beyond this amount.
Consumer cooperatives often have a strong social impact in their communities by promoting the local economy, creating sustainable jobs and supporting ethical business practices.
In short, consumer cooperatives offer an economic and social alternative focused on meeting members’ needs, democratic participation, financial responsibility and positive impact on the community.
In conclusion, this post is part of a series exploring the five types of cooperatives. Our aim is to explain the specific features and advantages of each cooperative model, be it consumer cooperatives or
In exploring this series, you’ll discover the many facets of these organizations as well as their positive impact on communities and the economy as a whole. If you’d like to learn more about the other types of cooperatives, check out the corresponding posts!