Why are consumer cooperative stores considered to be less expensive? What are their relative advantages over other large scale retailers?
Why are consumer cooperative stores considered to be less expensive? What are their relative advantages over other large scale retailers?
A consumer cooperative store is an organisation owned, managed and controlled by consumers themselves. The objective of such stores is to reduce the number of middlemen who increase the cost of the product, and thereby provide service to the members. The cooperative stores generally buy in large quantity, directly from manufacturers or wholesalers and sell them to the consumers at reasonable prices. The profits earned by consumer cooperative stores during a year are utilised for declaring bonus to members and for strengthening the general reserves and general welfare funds or similar funds for social and educational benefits of the members. This is why consumer cooperative stores considered to be less expensive.
Advantages of Consumer cooperative stores over large scale retailers are as below:
- It is easy to form a consumer cooperative society.
- The liability of the members in a cooperative store is limited to the extent of the capital contributed by them. It has democratic management. Each member has one vote, irrespective of the number of shares held by him/her.
- Elimination of middlemen results in lower prices for the consumer goods to the members.
- The consumer cooperative stores normally sell goods on cash basis.
- The consumer cooperative stores are generally opened at convenient public places where the members and others can easily buy the product.
A consumer cooperative store is an organisation owned, managed and controlled by consumers themselves. The objective of such stores is to reduce the number of middlemen who increase the cost of the product, and thereby provide service to the members. The cooperative stores generally buy in large quantity, directly from manufacturers or wholesalers and sell them to the consumers at reasonable prices. The profits earned by consumer cooperative stores during a year are utilised for declaring bonus to members and for strengthening the general reserves and general welfare funds or similar funds for social and educational benefits of the members. This is why consumer cooperative stores considered to be less expensive.
Advantages of Consumer cooperative stores over large scale retailers are as below:
- It is easy to form a consumer cooperative society.
- The liability of the members in a cooperative store is limited to the extent of the capital contributed by them. It has democratic management. Each member has one vote, irrespective of the number of shares held by him/her.
- Elimination of middlemen results in lower prices for the consumer goods to the members.
- The consumer cooperative stores normally sell goods on cash basis.
- The consumer cooperative stores are generally opened at convenient public places where the members and others can easily buy the product.
