Why Coops Fail

8/7/2019 Why Coops Fail

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WHY COOPERATIVES FAIL

1. Poor selection of directors,

especially those who fail tosupport their cooperatives.

2. Members who join but neveruse their cooperative and bypass

it for a small gain elsewhere.


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3. Members who use cooperatives

but fail to take responsibility.

Each member must be ready to

accept responsibility when asked,

or as the need arises.

4. Members who never ask

questions and who let a few

persons make policy.



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5. Members who do not attend

annual meetings and directors whofail to attend board meetings.

6. Lack of consistent membership

education about the problemscooperatives face and the

challenges they must meet.



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7. Not supporting the cooperative

with enough money to get the jobdone.

8. Low-cost-management It is

the most expensive item for acooperative. High-priced

management is usually the least

expensive item.



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9. Not closely watching the

formation of cliques and specialinterest groups within the

cooperative.

10. Concealing facts about acooperative. All facts, both good

and bad, should be placed on not

under the table.



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11. Errors in financial policy,

such as over-extension of credit,

too little capital and poor

accounting records.

12. Management errors, such as

inadequate inventory, poor

location, employee dishonesty,

nepotism, poorly conducted

meetings, incompetent directors and

admittance of disloyal members.



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SUCCESS FACTORS IN

COOPERATIVE OPERATIONS

THE

COOPERATIVES

LIFE

1. The cooperative is born out of necessity.

2. Present conditions

point towards

successful futureoperations.

3. Cooperatives

must overcome

destructivecompetition.


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THE

MEMBERS

CONCERN

1. Members recognition of common needs.

2. Members

determination to

help themselves.

3. Members

conviction that

group action offers

more advantages tothem.

SUCCESS FACTORS IN



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COOPERATIVE

EDUCATION

1. Continuous membership education.

2. Specialized

training for office

bearers andemployees.

3. Proper guidance.

SUCCESS FACTORS IN



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MANAGEMENT

1. Good record keeping.

2. Sound financial

management and

frequent audits.

3. Presence of

dedicated leaders.

SUCCESS FACTORS IN



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BUSINESS

OPERATIONS

1. Adequate volume of business.

2. Sufficient

financing.

3. Sound operating

policies.

SUCCESS FACTORS IN



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THE

KEY PEOPLE IN

COOPERATIVES

1. Enlightened and responsible membership.

2. Dynamic and

dedicated leadership.

3. Honest and

effective mgmt.

SUCCESS FACTORS IN


Why Coops Fail

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