A very interesting article in Stockman GrassFarmer this month got me thinking. Alan Nation has a lengthy article on farmer co-ops highlighting the success of farmer "buying" co-ops where farmers band together to buy inputs at lower prices - this is a simple system that works really well.
On the other hand farmer" selling" co-ops that are set up to market farmers produce at higher than commodity prices have been spectacularily unsucessful. These fail because no real business has it's primary goal to pay a premium price for it's production inputs. We as producers certainly don't run our businesses on this premis. His conclusion is the more simple a co-op operation is the better the chance of success. If a co-op needs a complex business plan, permanent management and highly specialised skills it probably should be structured as a for-profit business and not a co-op.
On the other hand farmer" selling" co-ops that are set up to market farmers produce at higher than commodity prices have been spectacularily unsucessful. These fail because no real business has it's primary goal to pay a premium price for it's production inputs. We as producers certainly don't run our businesses on this premis. His conclusion is the more simple a co-op operation is the better the chance of success. If a co-op needs a complex business plan, permanent management and highly specialised skills it probably should be structured as a for-profit business and not a co-op.