JSS1 Business Studies Lesson Note on Cooperative Societies

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Cooperative Societies

Meaning of Cooperative Societies

A cooperative Society exists when groups of workers, individuals, organizations, farmers or communities pull their resources together towards a common goal.  The main purpose of the cooperative society is to:

(i)        Sell goods and services to members at a cheap rate.

(ii)       To do business together for profit purpose and share the profits among the members.

Types of Cooperative Society:

The common types of cooperative societies are:

1. Producers Cooperative
2. Consumers Cooperative

(a)       Producers Cooperative:

Producers form a common association in order to sell their products in a uniform price instead of selling individually, e.g. producers of yam, garri, cocoa etc may form a cooperative society for the selling of their products.

(b)       Consumers Cooperative:

In consumers’ cooperative, the members are consumers who contribute funds and buy goods in large quantities from the producers and sell in retail prices to members at a reduced and cheaper rate.

Advantages of Cooperative Society:

1. Members have equal rights and votes.
2. Prices are lower as they buy in bulk.
3. Benefits of repayment of capital to any member who withdraws.
4. Profits are shared in proportion to contribution.
5. Members are allowed to pay back debts in installments.

Disadvantages of Cooperative Society:

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