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 Purchasing power is the amount of goods and services that can be purchased with a unit of currency. For example, if one had taken one unit of currency to a store in the 1950s, it would have been possible to buy a greater number of items than would ...

to acquire discounts from

manufacturer Manufacturing is the creation or production of goods with the help of equipment, labor, machines, tools, and chemical or biological processing or formulation. It is the essence of secondary sector of the economy. The term may refer to ...

s 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 A grocery store ( AE), grocery shop ( BE) or simply grocery is a store that primarily retails a general range of food products, which may be fresh or packaged. In everyday U.S. usage, however, "grocery store" is a synonym for supermarket, a ...

hardware stores Hardware stores (in a number of countries, "shops"), sometimes known as DIY stores, sell household hardware for home improvement including: fasteners, building materials, hand tools, power tools, keys, locks, hinges, chains, plumbing supplies, ...

, and

pharmacies Pharmacy is the science and practice of discovering, producing, preparing, dispensing, reviewing and monitoring medications, aiming to ensure the safe, effective, and affordable use of medicines. It is a miscellaneous science as it links healt ...

to participate in retailers' cooperatives. A

consumers' cooperative A consumers' co-operative is an enterprise owned by consumers and managed democratically and that aims at fulfilling the needs and aspirations of its members. Such co-operatives operate within the market system, independently of the state, as a f ...

, 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 Mitre 10 is an Australian retail and trade hardware store chain. Operations are based on a cooperative system, where the store owners are members of the national group and each has voting rights. The chain name references the mitre joint. Th ...

** 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 Federated Co-operatives Limited (FCL), operating as Co-op, is a co-operative federation providing procurement and distribution to member co-operatives in Western Canada. It was established in 1944 after a series of amalgamations of smaller coop ...

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 Ace Hardware Corporation is an American hardware retailers' cooperative based in Oak Brook, Illinois, United States. It is the world's largest hardware retail cooperative, and the largest non-grocery American retail cooperative. Founded in 19 ...

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 In statistics, as opposed to its general use in mathematics, a parameter is any measured quantity of a statistical population that summarises or describes an aspect of the population, such as a mean or a standard deviation. If a population exa ...

''(until 2018, now privately owned)'' **

Best Western Best Western International, Inc. owns the Best Western Hotels & Resorts brand, which it licenses to over 4,700 hotels worldwide. The franchise, with its corporate headquarters in Phoenix, Arizona, includes more than 2,000 hotels in North America. ...

** 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 The Edeka Group is the largest German supermarket corporation , holding a market share of 20.3%. Founded in 1907, it consists today of several co-operatives of independent supermarkets all operating under the umbrella organisation ''Edeka Zentr ...

*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