A co-operative is about working collectively toward a common goal. This goal could be saving money or starting a business. Familiar examples of co-operatives are the stokvel or the burial society in your community. These are forms of co-operatives where members contribute an amount of money for a particular purpose. A co-operative is self-directed. This means that it is owned and run by its members and not by government or business.

 Advantages of working for a co-operative

• Being community-initiated and run, they are usually more secure, considerate and responsible.
• They can offer better job satisfaction and variety, and they encourage a strong work commitment.
• They are more accountable to their customers and to the community which they serve.
• They provide limited liability for individuals involved.
• Co-operatives are well recognized as highly innovative and feasible businesses.

Disadvantages of working for a co-operative 

• Likelihood of conflict amongst members.
• Longer decision-making processes.
• The active participation of members is required for success.
• Extensive record-keeping required, but this is no different from other work.
• There is less motivation to put in further capital to 'grow the business'

Registering co-operatives

Once a group of people decide to form a co-operative they must call a formal meeting to discuss and plan how best to put in practice their ideas. At this meeting they must elect a formation committee. The formation committee then elects amongst themselves 3 people to perform the tasks of interim chairperson, secretary and treasurer.

To operate legally, the formation committee must register with the Registrar of Co-operatives. This is the Government Department that deals with Co-operatives. The following tasks must be completed for registration.

• Election of a formation committee
• Write to Registrar of Co-operatives (private bag X237, Pretoria, 0001)
• Prepare Draft Bylaws of the co-operative
• Carry out a study on the proposed activities and business of the Co-operative.
• Prepare Business Plan
• Call a founding meeting

For more info on registration,  click here.

Co-operatives are widely recognised for their prospective economic input.  They are getting great attention and support from the government. For example, organisations such as National Youth Development Agency are supporting the development of youth co-operatives as a means of addressing the economic challenges facing young people. Cited: Umsobomvu Youthportal, 2009.

 Sources:

• SEDA  
• Wikipedia
• Co-operatives future  
• Youthportal

 Updated: 31 January 2011

by Zanele Matshotyana