Retail Co-ops Overview
In the shopping experience and retail space, cooperatives most commonly take on two models, one in which the customers are the members who own the business together and the other in which the retail location owners are the members who own the bigger company together. What both models have in common is they keep community at the heart of their operations.
Customer-Owned Retail Co-ops
When customers own the retail stores, they are the shareholders that have a say in the business and share the benefits of profitable growth. In a customer-owned co-op, membership is more than a reward program; it is an empowerment program, giving them ownership in the shopping experience. These co-ops not only offer competitive prices and discounts to their customers, but give them a voice in the business. Because member-ownership means the customers are shareholders, co-ops offer actual profit sharing based on participation when the company is successful.
Retailer-Owned, Not Franchised
When independent business owners in the same line of retail come together, their success is multiplied. Commonly known as purchasing and marketing cooperatives, these companies can grow to be retail giants generating annual revenues in the billions of dollars range. But who owns, controls, and benefits in these businesses? Not outside investors. The local store owners running their independent locations collectively own the bigger company, which unites them and allows them to benefit from shared success. Purchasing co-ops will look like any other business, but they are not franchises or chains where the company is controlled from the top down. They are co-ops controlled from the bottom up, where the members who work hard to serve their local communities are at the heart of decision making and are always first to benefit from the company’s growth. These co-ops often offer their individual member storefronts unique brands, marketing and social media tools, and training services.
What Makes Retail Co-ops Unique
Retail co-ops are unique because they offer a competitive alternative to the conventional business that operates on the interests of investors before communities. Whether the customers or the individual store owners are the members, retail co-ops are deeply tied to their local communities; ensuring that the people at the heart of the organization are always more important than the bottom line.
“Co-ops in retail keep local community at the heart of their operations.”
Did You Know?
- The largest consumer-owned retailer in the United States is REI, based in Seattle, Washington.
- Roughly 50,000 independent business owners are member-owners of purchasing cooperatives.
- For every $100 spent locally, $68 stays in your community. This compares to only $43 that stays in your community through a traditional chain firm.