Multi-stakeholder cooperatives: a community example

Fleshing out how communities business and leaders can work together to create a viable economy that recirculates dollars and celebrates locality as a strategy.

Imagine a community lost in time from its economically viable place. Seven miles between towns once made sense when the horse and buggy reigned as the primary mode of transportation. Even those halfway between towns could only make it to town and back by committing several hours of travel. That time/spatial environment has been reduced in a similar manner to the viability of communities not "on-the-grow". Towns of 1,000 inhabitants that supported numerous types of business in the past are now merely empty glass window relics of bygone days. Rather than deciding what local grocery store to shop in, people now look to the nearest community with a supermarket. Pharmacies, which used to link the community to its local medical providers, are replaced by chain stores strategically located many miles away. Even taverns are replaced by convenience one-stop filling stations. You know that a community is in trouble when the only reason for stopping is that the one stop light has inconveniently turned red.

Now consider a community working together to overcome their difficulties. The community considers their commonalities and develops a shared vision for meeting both economic and social objectives. To reach this vision, they development common goals and establish meaningful communication linkages. This economic development strategy is what is called the multi-stakeholder cooperative. Looking at the economic and business needs of a community is a logical starting place.

Are there support systems in place that allow the community to be entrepreneurial-friendly? Starting or expanding any business cannot be constructively accomplished by individual effort.

Community can be expressed as a geographic location or a collection of similar interests. Multi-stakeholder cooperatives span both of these “interests;” however, it generally begins with a location.

The similar interest is the economic viability of not only individual businesses, but rather the synergistic multiplier present when all work toward a common goal of the purpose for the “place.” Cooperatives are defined as having common purpose and shared responsibilities. The sharing of common business acumens and services necessary for success is possible when trust among the cooperative is present.

When a community of businesses work together to share knowledge, resources and connections; dollars that would have normally flowed out of the community are now circulated among the many members of the cooperative. Knowledge can be formal or informal business consulting in subject areas like financial management, marketing and personnel issues. Resources that can be shared could include office and meeting space, printing, copying and fax along with internet access. Connections to strategic planning and facilitation trainings are additional examples of knowledge connections.

Procurement of commonly-used goods purchased outside the community would not only reduce costs, but can be a good starting point for working together. Building services like maintenance, repairs and lawn care should be contracted within the community. Henry Ford, when asked why he offered his workers $5 per day, replied, “So that they can buy the cars they build.” This will enhance both purchasing power and dollars spend to remain local.

The ability to work together is paramount to any cooperative, and multi-stakeholder cooperatives are no exception. Also necessary are some immediate returns (reinforcements) either in profits or increased community spirit. Long-term success depends not only on businesses working together, but also the community at large taking some ownership in the cooperatives operation. Many feel that the knowledge pool is being drained by the lack of local economy, but the talent and collective wisdom present in every community is often overlooked. This merger of needs and ideas builds trust and ownership.

Michigan State University Extension educators, with the MSU Product Center, work with cooperatives to provide assistance toward positive business outcomes.

For more information on multi-stakeholder cooperatives, see the publication Solidarity as a Business Model, a publication of the Cooperative Development Center at Kent State University.

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