Cooperatives: Providing Livelihood to people and empowering them with new jobs, new roles and new opportunities

Article by – Shishir Tripathi
Intern at Hariyali Foundation
In collaboration with
Educational News

In the present day times, where a virus is killing lives and people losing jobs each day, it is really important to have some skill, some qualification so that the contribution of an individual to the firm, to the organization or to the government cannot be ignored and the jobs are maintained like the previous times. But creation of new jobs is a slightly difficult thing at present and starting a business all on own is risky too. Now what next then?

This problem is being faced by most of the youth at present in India. To overcome this problem creation of Cooperatives by people can be a very great option. Cooperative society or Cooperative is an association or a group created voluntarily with the aim of fulfilling the common interests of its members.

One can easily decode cooperative as simply a group that is being created by people of similar interests or occupation that come together and start a new venture collectively.

People in many parts of India have come together at the local level and are running cooperatives together and earning good amount of income.
Starting a cooperative society is not so difficult task. According to Societies Act, 1860 a minimum of 7 people can form a cooperative.

For creating a cooperative, a proper mutual understanding between its members should be there regarding the work to be done, contribution of each member into the work done and other investments, distribution of profit after the work between the members and many more issues having a possibility of arising conflicts between the members of the society.
Cooperatives are different from other businesses because they function more for the benefits of their members rather than just earning profit for the investors.

Cooperatives are organized to provide competition, reducing costs, improving the bargaining power, expand new and existing market opportunities, improve product or service quality or both, and obtain unavailable products or services (those products or services that profit-driven firms don’t offer because they consider them as unprofitable).

In Businesses, the share of the person who has invested to the highest amount in the profit is highest. But in Cooperatives the profit earned is distributed among its members as per their contribution in the work or in the production process.

In the process of setting up of a cooperative, a core committee should be formed to represent the cooperative and those members who are good at a particular skill which is required for the growth of the cooperative.

Secondly, a proper study regarding the market should be done so that whichever product or service will be provided by the Cooperative, it gets its consumers in no time it arrives in the market.

All cooperatives have to be incorporated under the appropriate state statute. Selecting a legal counsel to draft or review the articles of incorporation and bylaws is equally important. A cooperative can start out with very basic bylaws and just refine them after developing the business plan.

Lastly, creating a proper plan regarding the techniques for efficient product of goods to be manufactured or following efficient ways to provide the services is important during setting up of a Cooperative. And also, it should be decided that how and when the services of the cooperative will be expanded in order to meet the demand requirements and overall well being of the members of the group.

There are many such examples of Cooperative societies in India that started from scratch and reached to a very high level in future not only across state borders but International borders too. Amul is one such example from India that started from the state of Gujarat in 1950 and is at the present the largest milk cooperative in the world. Amul is owned by 3.6 million milk producers and produces 4.5 million litres of milk per day with an annual turnover of more than 52,000 crores.

Another cooperative from Mumbai known as Shree Mahila Griha Udyog popularly known as Lijjat Papad brand created with the objective of empowerment of women by providing them employment opportunities. With total 43000 members all across the country, it has an annual turnover of more than 801 Crores producing Papad, soaps and detergents, Masale (spices), Gehu Atta (wheat flour), bakery products, Khakhra, Appalam, Chapati,etc.

Therefore people should talk about their interests and mission and collaborate together in the form of cooperatives and can work together and earn their livelihood and good profits by the means of production and various other services.

This needs to be read by every individual who’s not having job, or has lost his or her job, or fears to start a business all alone. Cooperatives will help people get stable income and overall prosperity to the locality, to the nation and obviously to the person who is working and his or her family too.

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