Features of Consumers’ Cooperative Society
Whenever the consumers of a particular area collectively establish a cooperative society with a view to purchasing daily necessary commodities at the optimum price this cooperative society is called Consumers’ Cooperative Society. It is a voluntary association of persons and is registered under the Co-operative Societies Act. A consumer cooperative is a cooperative business owned by its customers for their mutual benefit. It is a form of free enterprise that is oriented toward service rather than pecuniary profit.
Consumers’ Cooperative societies have various kinds of dynamic features. These are as follows:
- Supply of goods:
It is the main task to provide daily necessary commodities to the members of the consumer cooperative society. Cooperative members purchase commodities directly from the producers or importers and purchase their commodities at a cheaper rate to the members to ensure the supply of goods. The purchases are made in bulk, thus enjoying economies of large scale purchasing.
- Product price:
Consumers’ cooperative society purchases the products from the producers or importers. That’s why an organization sells these products at a cheaper rate as well. Very less amount is spent on advertising. This is because the goods are mainly purchased for the members.
- Quality of goods:
As consumers of cooperative society purchase the goods from the original producers and collect authentic goods. That’s why the members get original goods also. The profit earned by society is distributed among the members and also spent on general welfare measures.
- Supply of capital:
Members collect the capital of the organization from the members. The capital of these societies is raised by issuing shares to the members. Capital is divided into particular number shares and each share has a face value on the basis members can purchase. The shares are usually of smaller denomination so that persons having limited income could also contribute and become members of the societies. Members can purchase shares to pay a particular amount.
Managing director and operators are selected among the members of a cooperative society. The Managing Board is build-up from the members of the organization. The Managing board operates the operative as well as managerial activities. There are a democratic control and management of the affairs of these societies.
- Distribution of dividend:
Profits are distributed among the members at the end of the year. The dividend is distributed against each share. The dividend is also provided on the total purchase amount of the shares. More purchase takes more divided. Goods are sold to members or non-members on a cash basis.
- The dignity of members:
Each member has equal dignity though the share amount is different. Rights and responsibilities are equal to each member. There is no discrimination among the members of the cooperative society. The membership of these stores is open to all the adults. The liability of members is limited to the extent of their contribution.
- Elimination of middlemen:
Consumers’ cooperative society purchases the goods from the original producers and that is enough to eliminate the middlemen. Every member is allowed to cast one vote irrespective of the number of shares purchased by him. The societies operate on the principle of ‘one member one vote’.
After considering above mentioned features we can say that consumers’ cooperative society has huge positive features which are enough for success in the country.