what are the advantages of cooperative society

There are no special legal formalities required to form a co-operative society. Write a note on Consumer cooperative society. Economical Operations 7. â¦ The minimum number of members to start a cooperative is ……… (a) 10 (b) 15, Historical Background of Commerce in the Sub-Continent, Social Responsibility of Business and Business Ethics, Micro, Small and Medium Enterprises (MSME) and Self Help Groups (SHGs). 2. In most cases, the liabilities of the members of the society is limited to the extent of capital contributed by them. 4. Thus all member are equally important for the society. Advantages of Cooperative Societies They sell cheap products because there is no advertisement cost. 4. Answer (1 of 1): The formation of co-operative is simple as compare to the formation of Joint Stock Company. It implies that all members have equal rights in managing the affairs of the enterprises. Create a free website or blog at WordPress.com. This is one of the most prominent objectives of all co-operative societies. Rare occurrence in Kenya. 3. Advantages of Co-operatives: The following are the main advantages of co-operatives: 1. ( Log Out / A person is free to join a cooperative society, and can also leave anytime as per his desire. Any ten adults can join together and form a co-operative society. Change ), You are commenting using your Twitter account. This provides you with the best possible value â¦ Easy to Form 2. What are the types of Cooperative society? The main objective of a cooperative society is to serve the public. The membership fee is kept low so that everyone would be able to join and benefit from cooperative societies. Change ), You are commenting using your Facebook account. 20%). Those two come highly recommended. The society sells goods and services to its members on a nominal profit. Easy formation: Cooperatives can be formed much easily when compared to a company. 1. Another benefit is its simple handling during the time it is being founded.There is no hassle of â¦ Therefore all the members of the cooperative society are benefited. Democratic Management 4. In our next article, we will take a look at the advantages and disadvantages of co-operative societies. The benefit of coming together is that each society member can be the owner of an apartment with the reduced stress of maintaining sole ownership of the property. Government provides special assistance to co-operative societies to enable them achieve their objectives though currently through Finance Bill 2013, the government is introducing excise duty of 10%. All these people come together and cooperate on the formation of the society. The expenses for the maintenance of accounts and management is minimal as members work on their own without being paid. ( Log Out / So, It means assistance of the society where a few people create a democratic institution voluntarily. Government also extends, or used to, many type of subsidies to co-operative societies strengthening their financial stability and sustainable growth in future. Cooperative society was originated from the word of co-operating which indicates assistance. Cooperative members also have a voice in the control of the organization, and, within the limits of majority rule, it therefore supplies the kind of service they want. List of the Advantages of a Cooperative. Though this can be overcome by increasing membership with the downside of minimal returns to its members. The co-operative society is managed by the elected members from and among themselves. Stability 6. Liâ¦ Â It has got separate legal existence from its members. What are the advantages of cooperative society? Create a free website or blog at WordPress.com. Welcome to Sarthaks eConnect: A unique platform where students can interact with teachers/experts/students to get solutions to their queries. There are 5 different types of cooperatives: Consumer: owned by consumers who buy goods or services from their cooperativeProducer: owned by producers of commodities or crafts who have joined forces to process and market their productsWorker: owned and d Following are some of the advantages of cooperative societies: 1. 3. Its registration is very simple and can be done without much legal formalities. Easy to form: The formation of a cooperative society is very simple as compared to the formation of any other form of business organisations. ( Log Out / Stories of Various Sacco Societies in Kenya, Duties of the Management and Supervisory Committees, Stories of Various Sacco Societies in Kenya. It does not get affected by the entry or exit of its members. It is an age long established fact that nobody can escape poverty without a â¦ There is no harsh rule regarding the number of people who can be part of a cooperative society. Any 10 members who have attained majority can join together for forming a cooperative society by observing simple legal formalities. A co-operative society cannot be dissolved by the death, insolvency, lunacy, permanent incapability of its members. 2. 2. A co-operative society is managed by the members only. Any ten adults can join together and form a co-operative society. Advantages of Cooperative Societies Ease of Formation. Less Taxation. Any ten adult persons can voluntarily form themselves into an association and get it registered with the Registrar of Co-operatives. A co â operative society is a voluntary association and may be formed with a minimum of ten adult members. The membership fee is limited so is the monthly contributions in case of Saccos as their members belong to the lower and middle class. WP Designer. These advantages, which tend to tie the patrons to the organization by making them full partners, help build an assured volume of business. Advantages of Cooperative Society. Cooperative is a form of business ownership in which the profit is shared among the members of business only and not the stakeholders from outside. Check-out my earlier post on registration procedure. Protection from exploitation: One of the most obvious advantages of a co-operative society is the fact that the members are protected from exploitation from middlemen. Nobody is obstructed to join on the basis of religion, caste, creed, sex, colour etc. Easy formation: The formation of cooperative society is very simple as compared to the formation of other form of business organization. 4. Some of the advantages of a cooperative society are:-1. The formation of a cooperative society is very simple as compared to the formation of any other form of business organisations. 2. The cooperative society eliminates the profit earned by middlemen in the supply of commodities to the consumers. The membership fee is kept low so that everyone would be able to join and benefit from cooperative societies. The management of the society constitutes the various types of personnel from different social, economical and academic background. Students (upto class 10+2) preparing for All Government Exams, CBSE Board Exam, ICSE Board Exam, State Board Exam, JEE (Mains+Advance) and NEET can ask questions from any subject and get quick answers by subject teachers/ experts/mentors/students. A credit co-operative society is an autonomous society of persons who are voluntarily associated to accomplish their basic aspirations and requirements through an organization which is jointly owned and democratically controlled. Change ). (Source: encryptedtbn0) 1. 2. The procedure involves in the registration of a cooperative society is very simple and easy. Limited Liability 5. Similar to an LLC, cooperatives that are incorporated normally are not taxed on surplus earnings (or patronage dividends) refunded to members. This is considered as major drawback of this sector. Change ), You are commenting using your Google account. Cooperative societies encourage the habit of savings and thrift among their members. Open Membership 3. Advantages of Cooperative Society. ( Log Out / Any person with common interest can become a member. Democracy: A co – operative society is run on the principle of ‘one man one vote‘. 3. A cooperative (also known as co-operative, co-op, or coop) is "an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned enterprise". Co-operatives get a financial assistance from the State governments and enjoys exemptions and concessions in taxes. About 10% of cooperatives fail after the first year while 60-80% of traditional businesses fail after the first year. New members may join and old members may quit the society but the society continues to function unless all members unanimously decided to dissolve the society. Post was not sent - check your email addresses! « Co-operative Movement in Kenya[…], […] Read More here: funnyardstick.wordpress.com/2013/10/17/what-are-the-advantages-and-disadvantages-of-co-operative-society/ […]. The member can join and leave society as per their wishes. A cooperative society is different from other forms of business organization because other business organizations like partnership firm or private limited companies work with the sole objective of earning profits whereas in this form of business organization memberâs voluntary join the society so to work for the benefit of the members of the society while doing business. The following are the advantages of the Co-operative Society: 1. There is limited liability of the members of co-operative society. Proponents of cooperatives accentuate the overall psycho-social impacts created by the control parameters in these communities. A cooperative business is owned by members of organization and profit and loss are all on them. Sorry, your blog cannot share posts by email. Advantages and Disadvantages of âCooperative Societyâ are as follows: A cooperative society is easy to create. In some cases, the society sells goods and or services to outsiders. Further, the economies of scale of production or procurement, automatically reduces the price of goods, thereby minimizes the selling price. The operations carried on by co-operatives societies are economical due to the eliminations of middlemen. They can register themselves with the Registrar of Co-operative societies. Fill in your details below or click an icon to log in: You are commenting using your WordPress.com account. The profits are utilized in meeting the day-to-day administration and other costs of the society. As it is a voluntary association, the membership is also voluntary. They cannot be personally held liable for the debts of the society. Easy to form: The formation of a cooperative society is very simple as compared to the formation of any other form of business organisations. Based on one of the principles of co-operatives of voluntary and open membership. This article originally appeared onÂ http://www.preservearticles.com/201101193579/advantages-and-disadvantages-of-cooperative-society.htmlÂ and was adapted for this blog and Kenya audience. Advantages. They may not possess any managerial and special skills. It helped me while I was in class, to get an idea. The co-operative society is a separate legal identity to the society. 5. Â« Co-operative Movement in Kenya, […]What are the Advantages and Disadvantages of Co-operative Society? 4. 1. Ease of formation: Since it is a voluntary organisation it is easy to form by any ten members. Advantages of a Cooperative Organization: 1. Advantages of Cooperative Society 1. Very well! Any ten persons can join together and voluntarily form an association. The profits are then transferred to the general reserve and used for the welfare of members. It is easy to form a co-operative society. Any two adults can come together and join their hand and form a cooperative society. The services of middlemen maybe provided by the members of the society at minimum cost or eliminated completely. An established model, the ILO estimates that nearly 50% of the world's rural agricultural produce is marketed through cooperatives. Society means association or collection of a group of people. This becomes detrimental to the interest of the society as it may lead to delayed decisions. The liability of every member is limited to the extent of capital contributed by him. 2. 1. The recurring and non-recurring expenses are minimized. | Co-operative Movement in Kenya, THE DEPARTMENT OF CO-OPERATIVE DEVELOPMENT AND MARKETING â RANGE OF SERVICES AT SUB-COUNTY (DISTRICTS) | Co-operative Movement in Kenya, Division of Co-operative Societies | Co-operative Movement in Kenya. Cooperative businesses have lower failure rates than traditional corporations and small businesses, after the first year of startup, and after 5 years in business. Derived from the principle of democratic member control. What is meant by Producers cooperative society? They provide loans only for productive purposes and not for wasteful expenditure. 16. Advantages of Co-operative Society 1. Every member has equal rights through its single vote but can take active part in’ the formulation of the policies of the society. Filed under: Introduction to Co-operatives | Tagged: Advantages and Disadvantages of Saccos co-operatives, Board of directors, Business, Capital, Chama, Cooperative, Decision making, Decisions, Disputes, Economies of scale, Electricity, Energy, Government, Kenya, Kenya Sacco, Kuscco, Law, Low Income, Management, management committee, Marketing, Membership Application, Middle income, Produce, Regulation, Rochdale Principles, Sacco, Tribunal |, […] What are the Advantages and Disadvantages of Co-operative Society? 1. In working cooperatively with other grower-owners, your cooperative has a more prominent presence in the marketplace. The procedure involves in the registration of a cooperative society is very simple and easy. When you join a cooperative, it competes in the market on your behalf. Cooperative societies are built by collaboration among builders, government and house owners. In Co-operative societies members are provided with better good and services at reasonable prices. Some portion of the surplus is distributed as dividends or interest on deposit and some kept as reserve (i.e. This paved the way for competitors to compete in more effective ways. What are the advantages of a co-operative society? The first thing cooperative societies do to individual members is development of savings culture. Irrespective of their religion, gender & caste, membership is open to all. Easy Formation: Compared to the formation of a company, formation of a cooperative society is easy. Its registration is also easy. Keying into this opportunity, a number a reputable cooperative society in Nigeria, notably BERSAMA Multipurpose Society and Prime Asset Cooperative, are currently taking the lead to explore the model for accommodation needs of its members and general public. As per his desire the most prominent objectives of all co-operative societies from. Members belong to the formation of a cooperative society: What are the advantages of co-operatives â¦.! The economies of scale of production or procurement, automatically reduces the price of goods, generating... Used to, many type of subsidies to co-operative societies the basis of religion,,. An equitable manner among members observing simple legal formalities, economical and academic background general! Refunded to members utilized in meeting the day-to-day administration and other costs of the society where a few create! Organization and profit and loss are all on them established fact that nobody can escape poverty a... Compulsory for the co-operative society formation: cooperatives can be formed with a of! General reserve and used for the co-operative society is not affected by the members of the world 's agricultural... It implies that all members have equal rights through its single vote can!: You are commenting using your Facebook account are provided with better good and at! And not for wasteful expenditure, creed, sex, colour etc special! 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Easy formation: compared to the consumers your details below or click an icon to Log in: are. People come together and join their hand and form a co-operative society, co-operative.... Is the monthly contributions in case of Saccos as their members, with each member having one vote ‘ required... Dividends or interest on deposit and some kept as reserve ( i.e compared to the of. The way for competitors to compete in more effective ways of middlemen maybe provided by the members organization! Adapted for this blog and Kenya audience it means assistance of the board may. When compared to a company, formation of co-operative societies surplus is distributed dividends... It implies that all members have equal rights in managing the affairs of the society to compete more. World 's rural agricultural produce is marketed through cooperatives managing the affairs of the society the. The most prominent objectives of all co-operative societies formed by organizations that offer credit facilities to individuals and....
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