The cooperative model can be an effective way for people to meet a common set of economic or social needs. Often a cooperative is organized in response to some adversity – individual farmers face falling dairy prices, for example, or a community loses its grocery store. Instead of operating to maximize investment returns, a cooperative operates to maximize member benefit by meeting member needs in a financially sustainable way.
Cooperatives can diversify and strengthen their local economic communities because of their local ownership, control, and operations. Profits tend to remain in the local economy because they are returned to members, or reinvested in the locally based cooperative business. When members patronize their local cooperative, they are supporting employment and business activity in their communities.
Members’ active participation in a cooperative can also benefit a community’s civic life. The empowering experience of self-determination through cooperation provides a perspective and set of skills that can be applied to other community activities.