Co-operatives - principles of working together

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The Department of Agriculture and Food and Fruit West delivered a seminar which highlighted grower-owned fruit marketing businesses and their retail success stories. When working together for collective business development, principles such as goals, realistic targets, adequate resources and suitable legal structure should be considered.

Working together – doing business smarter

In May 2012 a seminar titled Routes to Retail Success was organised by The Department of Agriculture and Food and Fruit West which showcased examples of successful local and interstate grower-owned fruit marketing businesses.

If growers of any type of produce are considering working together to improve the critical mass of their products in the marketplace, or for other reasons, some basic factors need to be considered. These principles of working together will assist collective business development to solve common industry problems.

Very clear and shared business goals

Identify your goals. Take time to understand the tasks needed to achieve each goal. Identifying the goals and scoping out the activities to be undertaken will help focus on the achievable.

Realistic targets and timeframes

Capturing small incremental gains will provide the building blocks and confidence to work on delivering bigger outcomes. Bedding down early gains will help the group learning process. Success breeds success and builds confidence.

As skills and leadership emerge, bigger gains will follow and confirm that working together does benefit everyone in the group. Group cohesion can be created by working on common interests as a precursor to establishing a formal business structure.

As an example, Sweeter Banana Association Inc. was formed by growers to sort out grading standards. Based on a positive experience in working together, the same growers had the confidence to create Sweeter Banana Co-operative Ltd to value-add in the areas of packing, logistics and marketing.

Adequately and fairly resource required activities

Working together to do business smarter is about achieving outcomes that an individual can’t achieve, or do as well, on their own. It leverages off the strength of numbers and collective resources. As such there needs to be a group-wide commitment to an equitable basis of contributing to resource needs.

Clear guidelines for sharing benefits

A simple recurring question is posed when working together ‑ i.e. “what’s in it for me?” The group’s leadership team needs to provide an answer that resonates with members, and potential members alike. It is not just about “the now”.

As in a family business, succession is critical. Setting out a succession plan and providing exit strategies will form part of answering the “what’s in it for me” question.

Time spent at the formation stage explaining how and when benefits will flow to members, will be rewarded many times over as the business moves forward and people come and go.

Legal structure

Working together is a business model based on people legally co-operating in an agreed way in return for a share in the collective benefits of their actions. A co-operative business model can operate under various legal structures. Deciding which structure suits a particular venture best will depend on a range of issues.

Most co-operative business models in Western Australia operate as a limited liability legal entity under the user friendly Co-operatives Act 2009 (WA). Other legal structures can be used, but they generally require professional legal advice to draft a special constitution and other documents to comply with the Corporations Act 2001 (Commonwealth).

Contact information

Brad Plunkett
+61 (0)8 9368 3541
Page last updated: Monday, 11 September 2017 - 9:22am