Cooperative OrganizationIn 13 Simple Steps!

How are cooperatives organized? Utilization of a timeline Defining influence Establishing members Meet and network ORGANIZATION!

#1: Invite and Identify

Invite Potential member-users to meet and

discuss Identify

Economic and community need to be filled

#2: Explore

Create an exploratory committee If continuing, select a steering

committee A what?▪ A group of individuals responsible for general

operating policy, procedures, and related matters affecting the cooperative

#3: Survey

Survey prospective members based on: Volume of need or use. Member-user experience and capabilities. Variety of products or services offered or

needed. Period of need or services. Current unit value—sales price or cost per

unit. Member-user—location of use or need. Familiarity with and use of other cooperatives

and willingness to join, finance, and use one.

#4: Discuss

Discuss survey results with potential members

Vote and decide how to proceed

#5: Analyze

Conduct needs and cost analysis Identify suitable markets, sources of supply,

and service providers and their requirements.▪ Use previous research and industry common

knowledge.▪ Survey market, supply or service provider sources.▪ Ask to conduct research and use findings:▪ State and/or Federal offices▪ Universities▪ Cooperative centers▪ Commodity organizations▪ Private consulting firms

#6: Discuss

Group hears results and votes whether to proceed.

Pre-membership agreements may be used if group is proceeding.

Initial investments may be collected

#7: Feasibility Analysis

Components of a study might include: Project description and justification Industry background Marketing situation Outlook and plans, Operational and technical characteristics Financial statements, projections, and sensitivity analysis Summary and recommendations.

Decide who will conduct the study Develop sound and realistic project assumptions Determine components for a comprehensive study Assess the study Accept or reject the study

#8: Present Results

4th Meeting Steering committee arranges for

incorporation and development of bylaws

Feasibility analysis provides development of the business plan. A what?▪ A formal statement of a set of business goals,

the reasons why they are believed attainable, and the plan for reaching those goals

#9: Bylaws and Incorporation

Prepare legal papers Draft bylaws Other paper work

Membership application Membership or stock certificate Marketing/purchasing agreements Revolving fund certificate Meeting notices and waivers of notice

#10: Meet and Elect

Call a meeting of charter members and potential members

Review and adopt the proposed bylaws

Elect a board of directors.

#11: Convene and Assign Convene first meeting of board and officers Assign responsibilities to implement business plan

Membership drive Membership application or stock subscription Acquiring capital and bank selection Initiate hiring of management Authorize officers/employees to handle funds Design and install accounting system Provide for bookkeeping and accounting services Bond officers and employees in accordance with

bylaws Choose a business location

#12: Acquire

Conduct a membership drive Acquire capital

How?▪ Membership stock shares▪ Member equity contributions▪ Loans▪ Outside equity accumulation

#13: Hire, Acquire, Begin!

Hire the manager! Gain facilities and production

equipment Begin operations!