A retailers' cooperative is a type of

cooperative A cooperative (also known as co-operative, co-op, or coop) is "an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democratically-contro ...

which employs

economies of scale In microeconomics, economies of scale are the cost advantages that enterprises obtain due to their scale of operation, and are typically measured by the amount of output produced per unit of time. A decrease in cost per unit of output enables ...

on behalf of its

retailer Retail is the sale of goods and services to consumers, in contrast to wholesaling, which is sale to business or institutional customers. A retailer purchases goods in large quantities from manufacturers, directly or through a wholesaler, and ...

members. Retailers' cooperatives use their purchasing power to acquire discounts from manufacturers and often share

marketing Marketing is the process of exploring, creating, and delivering value to meet the needs of a target market in terms of goods and services; potentially including selection of a target audience; selection of certain attributes or themes to emph ...

expenses. A retailers' cooperative is essentially a group of independently owned businesses that pool their resources to purchase in bulk, usually by establishing a central buying organization, and engage in joint promotion efforts. It is common for locally owned grocery stores, hardware stores, and pharmacies to participate in retailers' cooperatives. A consumers' cooperative, sometimes referred to as a retail cooperative, should be distinguished from a retailers' cooperative.

Governance and operation

Retailers' cooperatives are governed by democratic member control, which generally means one vote per member. Some firms, such as E. Leclerc, are able to make decisions in this fashion, with each member business only receiving one vote. For many retailer co-ops, however, it is difficult to achieve a democratic standard. Since the members are businesses rather than individuals, offering one vote per member will leave the larger member businesses underrepresented. If the number of votes is based on the size of the business, there is a risk of all smaller businesses within the cooperative being outvoted by a larger business. A democratic solution that many retailers' cooperatives employ is an increase in votes based on business size, up to a certain point, say 5 or 10 votes. This way, there is a varying degree of representation for member businesses, but no one member can gain too much control.

Financing and economic goals

In order to lower costs, retailers' cooperatives establish central buying locations, providing them with the opportunity to purchase in bulk. Retailers' cooperatives also engage in group advertising and promotion, uniform stock merchandising, and private branding. This leads to consumer recognition of brands such as ACE Hardware, giving the stores the benefits of being a franchise, with the autonomy and freedom of an independent store. The aim of the cooperative is to improve buying conditions for its members, which are retail businesses in this case. The incentive to remain in the cooperative is largely due to the profits that members gain. Generally, any surpluses are shared by the members in accordance with their original input.

Examples

Examples of retailer's cooperatives include the following: *Australia and New Zealand ** Mitre 10 ** Foodstuffs *Canada **

Carpet One A carpet is a textile floor covering typically consisting of an upper layer of pile attached to a backing. The pile was traditionally made from wool, but since the 20th century synthetic fibers such as polypropylene, nylon, or polyester ...

** Federated Co-operatives **

Home Hardware Home Hardware Stores Ltd. is a privately held Canadian home improvement, construction materials, and furniture retailer. Co-founded in 1964 by Walter Hachborn and headquartered in St. Jacobs, Ontario, the chain is co-operatively owned by ov ...

*United States **

** Ace Hardware **

Chez Hotels Chez may refer to: * Anthony Chez (1872-1937), American football, basketball, and baseball coach and college athletics administrator * Chez Reavie (born 1981), American golfer * Chez Hotels, an American chain of franchised hotels * CHEZ-FM ...

Do It Best Do It Best Corp., formerly known as Hardware Wholesalers, Inc. (HWI), is a member-owned hardware, lumber, and building materials cooperative based in Fort Wayne, Indiana. Do it Best Corp. is the second-largest co-op in the industry approaching $ ...

** True Value ''(until 2018, now privately owned)'' ** Best Western ** ShopRite **

National Automotive Parts Association The National Automotive Parts Association (NAPA), also known as NAPA Auto Parts, founded in 1925, is an American retailers' cooperative distributing automotive replacement parts, accessories and service items throughout North America. Opera ...

(NAPA) *France ** E.Leclerc **

Les Mousquetaires Les Mousquetaires, known as in Portugal, is a privately owned retailing symbol group based in France and operating internationally. Its head office is in Bondoufle Bondoufle () is a commune in the Essonne department in Île-de-France in north ...

** Systeme U *Germany ** Edeka *Italy **

Conad Conad ('), stylized CONAD, is an Italian retail store brand which operates one of the largest supermarket chains in Italy. Created in 1962, Conad is a cooperative A cooperative (also known as co-operative, co-op, or coop) is "an autono ...

*United Kingdom ** Nisa ** Edinburgh Bicycle Cooperative

Governance and operation

Financing and economic goals

Examples

References

See also