ZIMSEC O Level Business Studies Notes: Features of Cooperatives
- A cooperative is defined as an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly owned and democratically controlled enterprise.
- A cooperative may also be defined as a business owned and controlled equally by the people who use its services or who work at it.
- They are governed by the Cooperatives Societies Act of Zimbabwe.
- They have open membership.
- They offer services to members.
- Members enjoy limited liability.
- Sells goods and services to its members at cost or nominal profit.
- Surplus is shared among the members
- Governments often assists cooperatives achieve their goals, assistance often comes in the form of grants.
- Labour is principally provided by the members
- Every member has one vote (primary societies)
- Education and training facilities provided by members.
- Easy to form since there are not that many legal requirements
- No obstruction to membership.
- Offer valuable services to members such as the provision of good and services at a reasonable prices.
- Enjoy economies of scale.
- Are democratically managed since members have equal voting powers.
- There is continuity after the death of each partner.
- Enjoy limited liability
- Limited resources since capital is provided by members only.
- Inefficient management.
- Lack of secrecy since all the financial information is known to all members.
- Disputes can be difficult to solve given the structure of cooperatives.
- Excessive government and political intervention.
- Lack of motivation since there is no profit motive.
To access more topics go to the O Level Business Notes page.