Difference between Producers’ and Consumers’ Cooperative Society

Difference between Producers’ and Consumers’ Cooperative Society

Difference between Producers’ Cooperative Society and Consumers’ Cooperative Society

A few small industrialist, labor, or producers establish a cooperative society to gather their limited capability in order to get huge production facilities and this kind of organization is called producers’ 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. A consumer can get its products from a manufacturer and the producer can make its own product. In simplest terms, producers generate something and consumers consume something. For example, supermarkets obtain its goods from a factory and the factory makes its products to sell

There are great differences between both of the business organizations though both are established with a view to prospering the financial condition of the producers as well as consumers. These distinctions are given below:

Producers’ Cooperative Society – Producers or industrial cooperatives are voluntary associations of little producers and artisans who join hands to face opposition and augment production.

  • Nature of Business: It is built by the collection of same products producers.
  • Objective: To protect the producer’s right in the way of producing the products regularly with the proper distribution.
  • Fields: Generally their activities are surrounded in the field of small and cottage industries.
  • Functions: It’s restated to the productions activities.
  • Advantages: It ensures large scale productions.
  • Nature of products: Raw materials and other components are collected to produce the products.
  • Capital: Huge capitals are essential in case of this business.
  • Certainty: The products sold in the competitive market, so the market has not certain.
  • Production of profit: Profit is distributed according to the payment of capital to the members.
  • Nature of Influences: Small producers’ interest is protected to eliminate merchant industrialist.

Consumers’ Cooperative Society – Consumers’ cooperatives are created by the consumers to get there on daily basis requirements at evenhanded prices. Such a society buys goods directly from manufacturers and wholesalers to get rid of the profits of middlemen.

  • Nature of Business: Purchasers or consumers of the different products establish these organizations.
  • Objective: To supply the necessary goods at a reasonable price is the main objective.
  • Fields: It’s very much suitable to provide daily necessary goods to the huge consumers who live the same locality.
  • Functions: Products distribution is the main function among the members.
  • Advantages: It ensures large scale of purchases.
  • Nature of products: Daily necessary commodities collect and sell to a large scale of consumers.
  • Capital: Comparatively less capital maintains this business.
  • Certainty: The market is great certain because all members are the purchaser even outside purchaser can also collect the products.
  • Production of profit: Profit is distributed according to the total purchase of the members.
  • Nature of Influences: Consider the consumption at a reasonable price to eliminate middlemen.

At last, we can comment considering above mentioned distinction that both cooperative societies are operated for the betterment of the members. However, producers’ cooperative society has a great role in the contribution of society.