chapter 8 Flashcards
Concept and Definition of Cooperatives
Cooperative are community based association of people organized to achieve
their common socioeconomic and cultural goals.
- Productive economic entities jointly owned, mutually owned, mutually
operated and democratically controlled by the members.
- It is the business with social responsibility.
- It contribute not only to the member but to the community and country as a
whole.
Cooperative Principle: (7 principle)
Open and voluntary membership
- Democratically controlled by the members
- Members economic participation
- Autonomy and independence
- Cooperative education training and information
- Cooperation among cooperatives
- Concern for community
Objective of the cooperatives
To create conducive environment to organize membership based cooperative
societies,
* To control small passive and scattered savings from the members to create
economic force and invest those resources for their owned socio-economic
and cultural development,
* To promote cooperative enterprises among the marginalized people as a
means of economic, social and cultural development,
* To transform the subsistence and traditional mode of production into
commercial and market oriented production through the cooperative system,
* To motivate stakeholders to operate cooperative movement based on the state
rules, regulations and principles,
* To achieve the national goal of poverty reduction through the cooperative
system.
Cooperative Farming
Cooperative farming refers to the farming practices where farming
operations are conducted co-operatively.
* In this type of farming, small individual holdings are merged into a
common unit and accordingly such farm is managed on cooperative basis.
* In cooperative farming each member farmer remains the owner of his land
individually, but farming is done jointly.
* Profit is distributed among the member farmers in the ratio of land owned
by them
Features of Cooperative Farming
Joining of farmers in this system is voluntary,
- Farmers retain their right of land,
- Farmers pool their land, livestock and other implements,
- The entire farm is managed as a single unit and the management is elected by
all the members,
- Each and every member earns a share of the total produce in accordance with
their land contribution and labour performed.
Advantages of Cooperative Farming:
Farmer can enjoy the benefit of large scale farming. Farmer’s can buy
large quantities of input in low cost and can purchased big machinery
cooperatively, thus increasing mechanization and productivity.
- Production of large marketable surplus and transportation in bulk
quantities and can obtain remunerative price.
- Farmers can enjoy the benefit of subsidies facilities provided by the
government for the cooperative.
- A group is more trustworthy for providing credit than individual farmer.
Kamal Regmi, Assistant Professor, IAAS,Paklih
Cooperative Marketing
Co-operative marketing is a co-operative association of cultivators formed
primarily for the purpose of helping the members to market their produce more
profitably than is possible through private trade.
- Co-operative marketing organizations are associations of producers for the
collective marketing of their produce and for securing for the members the
advantages that result from large-scale business which an individual cultivator
cannot secure because of his small marketable surplus
- Main aim of cooperative marketing
s to reduce the marketing margin
and thereby ensure the farmer a better price for their produce and
supply the goods to the consumers at a fair price.
Objective:
To help the farmers to produce best products according to its demand,
* To help its member to ensure better price of their products,
* To give fair weights,
* To properly handle the produce without damage or wastes,
* To give a better understanding to the farmers in the marketing process.
Functions of Cooperative marketing
The main functions of co-operative marketing societies are:
- To market the produce of the members of the society at fair prices;
- To safeguard the members for excessive marketing costs and malpractices;
- To make credit facilities available to the members against the security of the produce
brought for sale;
- To make arrangements for the scientific storage of the members’ produce;
- To provide the facilities of grading and market information which may help them to
get a good price for their produce;
- To increase the bargaining power of the individual farmers;
- To act as an agent of the government for the procurement of food grains and for the
implementation of the price support policy;
- To arrange for the export of the produce of the members so that they may get better
returns;
- To make arrangements for the transport of the produce of the members from the
villages to the market on collective basis and bring about a reduction in the cost of
transportation; and
- To arrange for the supply of the inputs required by the farmers, such as improved
seeds, fertilizers, insecticides and pesticides.
Advantage of Cooperative marketing
Reduce cost and improved services based in the economics of scale
* Improved marketability of products through easy market research and
understanding demand and supply strategy
* Improved bargaining power as the supply is in the control of the
association
* Controlling the flow of product into the market
* Cheaper finance to individual member to invest in production
* Training in business methods
Types of Cooperatives
- Producers Cooperatives
- Multi-stakeholder Cooperatives:
- Worker co-operatives:
- Consumer co-operatives:
Basically there are following types of farmers’ cooperatives in Nepal:
- Marketing Cooperatives:
- Farm Supply Cooperatives:
- Service Cooperatives:
- Production Cooperatives:
- Processing Cooperatives:
Value addition:
Value addition in agriculture marketing refers to the process of adding
value to agricultural products through various means, such as processing,
packaging, branding, or other forms of value-enhancing activities.
- It refers to creation of a competitive advantage by combining packaging
features and benefits or through any other method that results in greater
customer acceptance.
- It can help farmers and agribusinesses to increase the value of their
products and get a higher price for them in the market.
Importance of value addition
- Increases the value of agricultural products:
- Helps to differentiate products:
- Builds stronger relationships with customers:
- Creates more sustainable and profitable operations:
- Provides opportunities for diversification:
