Published every Thursday at Palmer, "laska, for the katanuska Valley Farmers'
Cooperating .association for the purpose;of giving news of the Associations Work,
Problems and Accomplishments,
SUBSCRIPTION BY MkIL $1.75 BOX $1.00 SINGLE COPY 10
MEMBERSHIP IN A. COOPERATIVE
If you are a member of a Cooperative Association, you are in business for yourself*
If your business is to be operated successfully, you must understand it thoroughly.
There are nine principles of Cooperatives listed under the Rochdale Cooperative plan,
but there ore three fundamental principles which distinguish a Cooperative organiza
tion fr®m a private business or Corporation. They ore listed by the Farm Credit Ad
ministration as —
1. Democratic Control by the Members,
2. Payment far Capital limited to a Conservative rate.
3. Sharing the benefits end savings of Cooperation in Direct Proportion to the
Fotronage of the Individual Members.
First: Democratic control is a universally recognized principle of Agricultural Co
operation. Those who ore intended to benefit from the organizetion(the members) must
hold the reins. If they do not oontrol, their benefits may disappear. Democratic'
control in a Cooperative is usually accomplished by voting on the basis of "one mem*
ber—one vote". This is the general accepted voting method of cooperatives. Under
this plan, it is difficult for the concentration of power to got into the hands of a
few. In about three-fourths of the States Cooperative lews provide that no member ot
holder of Common Stock shall be entitlod to more than one vote regardless of the
amount of patronage furnished. Of course, each member cannot directly take part in
formulating all the operating methods nnd policies for the Association. Only the
broad policies are determined by the members, while the business policies and opera
ting practices are determined by th” Hoard of Directors who are the representatives
nnd the Trustees of those who elect them.
Second: Capital is as necessary in the operation of a Cooperative as it is in any
other type of business to provide buildings, equipment, and to furnish funds for
operation. However, since a Co-op is non-profit in its set-up, the earnings are
really the savings of the members and it cannot disperse those earnings as profit t®
capital. Therefore, capital is employed 'just as a manager or other workers are em
ployed. This also means that it must limit the interost it pays for capital t® tho
"going rate". In a Cooperative, after l^bor, land, management and all expenses are
paid for, the remainder belongs to the members. If operations hav<-- not been success
ful, the members lose. It is therefore the members who gain or lose end not capital.
Third: Volume of business, or "patronage", is the most important contribution a
membor can make to his c#-op. In order to buy end sell effectively it takes volume
to bring about savings to tho membor.
A Cooperative does one or both of two things to accomplish its purpose.
1. It furnishes essential services or goods at a lower cost then otherwise possible
or
2. It furnishes better services or goods than otherwise available.
Benefits to members should show up in any number of ways
1, Lower handling costs may refloat in a higher net return,
2, Better services mny odd up to a better prieo,
3, Usually part or all of his economic gain through his Co-op will come to him in
the form of patronage dividends or refunds at the end of some definite period.
Sometimes these are not paid in cash, but are issued in the form of evidences of
ownership--o certificate which shows that the member has a certain amount of accumu
lated savings credited to his name. Later these are redeemed in cash as sufficient
capital is built up.
It is up to the members to see that their cooperative associations observe the fore
going principles. This is the first step in securing and maintaining efficient
management and sound operating practices,
’’Any group of ha.rd working men con build a small commission firm, but it takes an
honest, hard working, experienced personnel-to-gether with an active, interested
membership and a capable board of directors, to build a successful Cooperative,"
P.0, Wilson, Seoret3ry-Ma.nager--Nntional Livestock Producers Association.