Cooperative

= COOPERATIVE =

Often referred to as a "co-op", a cooperative is a limited liability entity that can organize for-profit or not-for-profit. A cooperative differs from a corporation in that it has members, as opposed to shareholders, who share decision-making authority. Cooperatives are typically classified as either consumer cooperatives or worker cooperatives. Cooperatives are fundamental to the ideology of economic democracy.

ADVANTAGES

 * Owned and controlled by members
 * Democratic control – one member, one vote
 * Limited liability
 * Profit distribution

DISADVANTAGES

 * Possible conflict between members
 * Longer decision-making process
 * Participation of members needed for success
 * Extensive record keeping
 * Less incentive to invest additional capital