Causes of Failure of Cooperative Societies in a Country
Cooperative society means the assistance of a society where a few people create a democratic institution voluntarily. Earning profit is not the main goal of cooperative society, rather prosperity of the members, ensuring the rights and dignity, develop, the worse situation, change the fate, believes, honesty, economic as well as increase the aides are the main goals of this society.
An undeveloped and developing country has a great possibility to succeed in the movement of a cooperative society. But it is not successful for some causes which are as follows:
- Inefficiency in management
An undeveloped and developing country suffers greatly with lack of efficient and experienced manager who is able to conduct the business. As a result, cooperative can get expected success. Having incentives and clearly communicating them helps co-ops avoid this potential difficulty. Clear, ongoing member and shareholder engagement help co-ops navigate this challenge.
- Insufficient sacrifice
The cause of failure of a cooperative society is the insufficient sacrifice in the members of a cooperative society the people of service mentality are not enough to succeed in an undeveloped and developing country. There are barriers to establish a cooperative society is our country.
- Lack of interest and inspiration
Inspiration and interest are very much crucial to establish a cooperative society. An undeveloped and developing country has lacked inspired and interested people to conduct this business. So this is also causing to failure of the cooperative business in an undeveloped and developing country.
- Inadequate capital
The cooperative business can’t be successful in an undeveloped and developing country because of a shortage of capital. For this reason, investment is not possible immediately because of the financial limitation of the members.
- Improper training facilities
Strong training is needed for the betterment of a cooperative society in an undeveloped and developing country. But the cooperative society of undeveloped and developing countries have not provided enough training facilities that members can’t grow efficiently.
- Lack of unity and cooperation
Cooperative is established through unity and cooperation with each other’s by following the principle unity is a strength. But it is not maintained in all activities which create a lack of unity and cooperation, consequently, it fails again.
- Lack of public trust
The people of an undeveloped and developing country have minimum trust towards the cooperative society. They become victims also by the different cheater. So they are not interested to attend in a cooperative society.
- Corruption and nepotism
Corruption and nepotism enter the ins and outs of an undeveloped and developing country; Cooperative society is not free form this curse. Various levels of directors involve corruption and nepotism which are very harmful to the cooperative business.
- Shortage of government facilities
Govt. support is very much essential to ahead of the cooperative organization. But govt. support of an undeveloped and developing country is very rare even various rules of government mate harriers in the development of cooperative society in Bangladesh.
- Legal complexity
The lack of direction has been noticed in the Cooperative Act of an undeveloped and developing country. So cooperative society falls into various legal complexities to conduct and establish a cooperative society in an undeveloped and developing country.
- Lack of market or community support
When a co-op is imposed by a group outside the community or market, this sense of ownership does not emerge organically. In these cases, the community may be mistrustful of the co-operative or have mixed expectations of their role in its operation.
From the above discussion, we can say that a cooperative society has a great potentiality to forward in an undeveloped and developing country. But the above-mentioned problems are the harriers to the advancement of cooperative society. So it needs to come forward to everyone to remove these problems and try to develop with the help of a cooperative society.