KCARD is the leading expert on the cooperative business structure in Kentucky. Since its establishment in 2001, KCARD has assisted over 50 cooperatives across the state at all stages of development. Through the USDA Rural Cooperative Development Grant program, KCARD continues to provide cooperative development work at little to no charge. KCARD staff has over 20 years of experience providing cooperative development assistance.
Cooperative businesses have three distinctive economic principles that separate them from other business structures:
1) User-Owned: The people (members) who use the co-op’s services help finance the co-op’s operations and own the business.
2) User-Controlled: Co-ops are democratically-controlled businesses, and voting rights are tied to membership status (usually one-member, one-vote) and not based on the level of investment.
3) User-Benefitted: The purpose of the co-op is to provide and distribute benefits to members based on their use of the services of the cooperative.
The purpose of a cooperative is to meet a common need amongst its members and to provide greater benefits to its members such as increasing income levels or accessing products or services otherwise not available without the co-op. Developing a cooperative is a deliberate process, and there are many important steps that need to be taken to increase the odds for success, including establishing a steering committee, assessing the feasibility, developing a business plan, creating organizational documents, conducting a membership and financing campaign, and starting operations.
A feasibility study or analysis is a critical step in developing a cooperative to see if the business idea is viable and to understand all the different factors required for success. A feasibility study addresses questions related to marketing feasibility, management requirements, technical and operational needs, and financial feasibility. The USDA Cooperative Feasibility Study Guide provides an overview of the key components of a feasibility study for cooperatives.
cooperative development centers
KCARD is one of over 30 cooperative development centers in the United States. KCARD often collaborates on projects and networks with other cooperative development centers. KCARD is a member of CooperationWorks! which is a national network of organizations and individuals dedicated to facilitating cooperative development. The National Cooperative Business Association (NCBA) is a membership organization for cooperative businesses, and NCBA has resources available for existing cooperatives or groups who are interested in starting a cooperative. Finally, the Mid America Cooperative Council is a regional association designed to support cooperatives and cooperative development through educational and training programs.