Starting a Co-op: Self Assessment
This simple Self-Assessment Tool can be a great resource when you are considering starting a co-op. It helps you focus on some of the most important questions you need to ask yourself about whether you are ready to start a co-op. The Self-Assessment Tool is attached as a word doc. From the introduction to the document:
This is a self-assessment in the truest sense. You won’t be asked to score a number of questions, total your score and then be told where you fit on an arbitrary scale that purports to measure temperament, attitudes or motivations. Rather, it’s an opportunity to reflect, talk to friends and family and potential members of your co-op. Starting any business requires taking risk. Eighty percent of small businesses fail. There are many reasons for failure including, poor planning, being overly optimistic, lack of adequate investment and cash, poor cost control, personal illness and plain bad luck.
Co-operatives generally fare better and have twice the survival rate – 40 percent.1 This is significantly better than other business models (sole proprietorship, partnership, and corporation), but it still means over half of start-up co-ops fail. Some of the reasons for the better survival rate for co-ops include more cautious and thoughtful decision-making, the emotional support members provide each other, pooling resources and talents, and support from other co-ops and federations. Like any good business, a co-op requires an excellent business plan, sufficient start-up capital, and the tenacity of its founders. There will be long hours, many meetings, and low pay in the start-up phase. And, there will also be break throughs, exciting developments and the internal reward of accomplishing something important to you and your community.
While many co-ops are profitable businesses, this is not their main goal. If you want to start a business “to get rich quick” (or slowly for that matter), a co-op business is not the right choice. If you want to work together with others to fulfill a collective need – say for meaningful work, housing, childcare, good food, joint marketing or purchasing, or filling any other gap in your community – then a co-op may be the right choice. The main difference between a co-op business and a regular company is democracy. This is both the strength and potential weakness of the co-op structure. It’s a strength because it offers people (members) more control over their lives and the potential for making better decisions collectively than individually. It’s a weakness because democratic decision-making requires more time, more discussion, and the ability to listen and even change one’s mind. This doesn’t mean that every little decision has to be made by the group. Usually, only longterm policies are determined this way, while day-to-day business operations are clearly assigned to various people, just like any business. A co-op is for you if you enjoy working together with other people, you have the interpersonal skills and patience to co-operatively find creative solutions and feel okay with managing conflicts.