Types of Co-ops

Cooperatives span many different activities and services from childcare to transportation, farming to solar energy, financial services to purchasing school supplies. Cooperatives are owned by their members, which could be consumers, producers/farmers, workers, businesses or organizations, municipalities, and other co-ops.

Here we define cooperatives by type of membership, or more simply, who owns the cooperative.

Consumer Cooperatives

Consumer cooperatives are owned by members who use the co-op to purchase the goods or services that they need. By combining member demand, the co-op can provide better availability, selection, pricing, or delivery of products or services to individual consumers. The model is used in many sectors and includes credit unions, grocery co-ops, telephone and electrical distribution, housing and childcare. Some examples of consumer cooperatives are: REI, UW Credit Union, Willy Street Co-op, Adams-Columbia Electric Cooperative, Madison Community Cooperative.

Worker Cooperatives

Worker cooperatives are businesses that are owned by their workers. Ownership allows the worker-members to control the operations and strategic direction of the business and to directly benefit from the business’s success. Profit distribution to worker owners is based on some combination of job position, hours worked, seniority, and salary. Worker cooperatives are found in a wide variety of industries. Some examples of worker cooperatives are: Union Cab Co-op, Isthmus Engineering and Manufacturing, Equal Exchange, Cooperative CareNorth Wind Renewable Energy.

Producer Cooperatives

Producer cooperatives are owned by people who produce  similar types of goods or services. The members use the cooperative to more effectively negotiate prices and to access larger markets. The cooperative can further process member products to add value and increase producer returns. Some producer cooperatives also pool member demand for production inputs to obtain better pricing for those inputs. Many agricultural cooperatives provide both types of services to their members. Some examples of producer cooperatives are: Ocean Spray, The Blueberry People, Organic Valley, Q Artist Cooperative, Kickapoo Woods Cooperative.

Purchasing or Shared Services Cooperatives

Purchasing cooperatives combine member demand to achieve better pricing, availability, and delivery of products or services. The members of purchasing cooperatives are businesses or organizations, rather than individual consumers, that use the cooperative to more efficiently manage their operations. Purchasing co-ops are used by hospitals, independent retail stores, farm supply cooperatives and educational institutions for cost-effective wholesale purchases. Examples include: Ace Hardware, Carpet One, Independent Pharmacy Cooperative, Educational & Institutional Cooperative Services.

Multi-stakeholder Cooperatives

Also referred to as hybrid or solidarity model cooperatives, multi-stakeholder cooperatives are owned by two or more types of members who have different roles and interests in an enterprise that more broadly benefits them all. Member classes may include consumers (either individuals or businesses), producers, workers, or investors. Examples include: Weaver Street Market, Fifth Season Cooperative, Wisconsin Food Hub Cooperative.