The Value And Competitiveness Of Farmer Cooperatives – With Empirical Examples
Discussions about the advantages, disadvantages, position, competitiveness and value of members of cooperatives are ongoing. However, the performance of farmer cooperatives vs investor-owned companies is not easy to analyze, measure and compare. A number of important issues in measuring and comparing the value of cooperatives are identified. The objectives and success criteria of the two types of companies are different and therefore the same indicators can not necessarily be used in a comparison. Several different indicators may be necessary to give a complete picture of the performance of cooperatives.
From a theoretical point of view, potential advantages and disadvantages of farmer cooperatives are identified, and the cooperative model is shown to have significant and substantial both advantages and disadvantages.
The existence of potential economic impacts of farmer cooperatives is tested by examples based on Danish conditions with access to relatively reliable databases. Indicators as market shares, financial robustness and profit sharing seem to support and confirm the assumption of cooperative benefits.
Key words: Cooperative, advantage, disadvantage, benefits, performance, value