These two forms of business organization are interesting since they align two of the three main stakeholders of organizations.
REI Co-op is a retail co-op that sells outdoor recreation equipment. I am a co-op “member”. I paid a $20 one time fee for the honor.
I receive my dividend each year in the form of product discounts that add up to 10% on what I spent the previous year.
The co-op aligns the interests of the customer and owner, because they are the same people. Customers want good quality products and services and good prices.
As owners, though, we also want the co-op to stay in business so we can keep buying good stuff, so we don’t want prices to be too cheap, or else the quality we desire as a customer may be sacrificed.
Because of this co-op customers may more aware that reasonable prices (rather than rock-bottom prices) serve their interests than customers of other types of organizations.
Credit unions are similar. They are essentially banks owned by the bank’s customers.
One of my parents worked for an employee-owned company.
Employee ownership aligns the interests of the employees and owners, because they are the same people.
The employees want to be paid well and also want the product quality and prices to be reasonable so the business will continue to do well.
Employee-owners may be a bit more aware of where their paychecks come from than employees of other types of organizations.
I wonder why these types of business organizations aren’t more common.
What if the union bought GM? Instead of having to bargain with management about compensation, they could pay themselves what they want.
Or, how about a streaming service owned by it’s members? What would that look like? Could that compete with Netflix?