Types of Cooperatives

Cooperatives are defined as any form of grouping that is carried out autonomously by two or more people who, associated voluntarily, seek to form a company with specific characteristics as established by the commercial laws themselves. The result of this association is a cooperative company.

Among its functions, its main element is to carry out activities of its commercial activity in a mutual manner and thus obtain the benefits for which the business company was established.

Among the benefits that a cooperative association can provide is that of offering a particular service to which the associates have decided to dedicate themselves and thereby be able to obtain profits that they can distribute or, where appropriate, reinvest in an equitable manner at the end of the fiscal year.

Types of cooperative

Work cooperative

This is an association entity whose purpose is to develop in the group the possibility of presenting self-employment in order to stimulate the economic dynamics of the locality in which the cooperative is located. With this, it is sought to be able to contribute working capital and/or human resources in the exchange of other goods.

The members of the cooperative will be the employees intended for business purposes, and being part of an association, they must make the relevant decisions jointly.

Service cooperative

Their ultimate purpose is to provide certain services required by society in the place where the cooperative is established. The benefits granted by said company will generate an equitable share of the profits for each of the associates as they are part of that benefit to which they are paid.

With this, it is sought to be able to provide services that are necessary in the locality, among which we can highlight the provision of educational and medical services, drinking water services and electricity; among others of a public or private nature.

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Electrical cooperative

This type of association, has as its central activity in the provision of a service, that of providing the input and transport of electrical energy for the locality in which they are located.

Housing cooperative

They are generally constituted as non-profit organizations, which are organized with the purpose of providing people who for some reason lack housing, the property itself. These organizations can be made up of the same people who do not have a home and when they join, they seek the necessary mechanisms to be able to have a roof over their heads.

Agricultural cooperative

It is developed within the area of ​​agriculture. Generally, the associates organize themselves to be able to preserve and commercialize their agricultural products in a more efficient and cheap way.

Fishing cooperative

This type of organization has fishing objectives within its economic activity and can be related to the provision of services in that area and even to incentives for fishing activity in particular.

School cooperative

These seek to clearly satisfy and guarantee the development of positive activities that help the student to satisfy certain needs, be they school or extracurricular. The association is generally formed through the participation of parents, students and teaching staff.

Association of savings and credits

They focus on the provision of financial services and generally function as an intermediary within the value chain of this credit industry and the provision of personal and business finance services.

It seeks, among other things, to efficiently manage the resources of the contributions of the associates, the administration of the credit commitments and the fulfillment of the loans to which they have been creditors for their organizational benefit.

Characteristics of cooperatives 

Among the main characteristics that a cooperative has, we have the conformation of materials and human resources, so that the actions of the association can be efficiently developed to achieve its obligations. In addition, financial resources, management instruments and workforce are administered and enjoyed; in other aspects. Within the cooperative association itself, all members have the same rights and obligations.

Regarding the number of people who can be part of a cooperative, as established by the laws of association and commercial companies, it stipulates that it must be less than 20 people. And there is an exception in the agricultural sector where only up to 10 members per association are allowed.

Structure of a cooperative

In most cases, its structure is basically made up of a board of directors, a surveillance committee, a board of education and a work team. Of course there may be certain variations in the structure although they must respect the legal provisions regarding this issue.

Difference between cooperative and company

It is important to note that there is a difference between what is commonly defined as a company and a cooperative. Even when both entities seek to obtain profits and other types of benefits, the difference is that in the cooperative, all the associates will act as owners of it, for this reason they will all respond jointly and equitably to the various situations that arise; something that does not happen in companies where the organizational structure is more complex.

The obligations of a company fall on what is known as a steering committee, so the employees of the company will not be affected by the positive or negative behavior of the company, they are hired with a fixed salary and certain benefits.