re: Take 4 – Ch 4, plus ‘co-ops’

Culturally, co-ops bring local people into a collaborative relationship, and they give them experience in managing their own ‘community affairs’, within the microcosm of the co-op. In these ways co-ops help build a sense of community, and a sense of empowerment, among community residents.

The initial funding for co-ops typically comes at least in part from the members themselves, which minimizes start-up indebtedness, and motivates the owner-members to make a success of the venture. And without non-participating investors, a co-op has the flexibility to operate on a break-even basis if that best serves the interests of the members and the nature of the co-op. In these ways, the co-op form is complementary to the goals of local self-sufficiency and community empowerment.

Consumer co-ops are a means of leveraging buying power, getting goods at wholesale prices, being able to control the quality of the goods, and being able to choose the suppliers. When people shop at a local co-op, wealth isn’t being drained from the community, as it is when they shop at corporate outlets. And the co-op can give preference to local suppliers. Unfortunately, while cheap foreign imports are still so readily available through corporate outlets, consumer co-ops can have a hard time competing in the local marketplace.

Co-ops whose members are enterprises can be leveraging either buying power or marketing budgets, depending on which side of the supply chain the co-op is operating on. These kinds of co-ops can be of considerable benefit to small local businesses, increasing their competitiveness by reducing their costs, while at the same time providing them with broader access to suppliers and markets.

Local worker-owned co-ops can be very beneficial to both the workers and the community, particularly if the members were formerly unemployed or under-employed. In these cases, the worker benefits significantly, and the community economy also gains from the productive contribution of formerly wasted local talent. Local talent is a local resource, and as with all local resources, if it can become more productive, that contributes to both community prosperity and community self-sufficiency.

Mondragon provides not only a successful model of local funding, but also a very successful and highly evolved model for worker co-ops, as described in the documentary video referenced above. They have developed a set of guidelines, and organizational mechanisms, that make for a very healthy enterprise. 

Under their system, the management team is empowered to do its job on a day-to-day basis, while at the same time the owner-workers are effectively represented at every level of the organization, ensuring that the co-op is managed in the best interests of all concerned. Ongoing communication across the levels of the organization is maintained, by means of various councils. 

A participatory spirit of ‘being on the same team’ is very important to the sound functioning of a worker-owned co-op, and at Mondragon they have learned that this spirit becomes difficult to maintain if a co-op grows too large. Rather than adding a new division to an existing co-op, for example, it often makes more sense to spin off a new autonomous co-op. 

A sense of team participation not only makes for productive and efficient operation, but it makes it easier for members to work out an equitable arrangement in bad economic times as well: Mondragón Worker-Cooperatives Decide How to Ride Out a Downturn.