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Student's Book Form Five
Offer reasonable prices and high-quality the committee elected by their members.
products: Co-operative organisations These members may not have the required
purchase and sell large quantities of goods qualifications, skills, or experience. Since
directly from producers and to customers co-operatives have limited financial
respectively. Fair prices and high-quality resources, their ability to recruit employees
products offered by the co-operative is limited. Therefore, they cannot
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organisations ensure market satisfaction. employ the most talented personnel. As
Social benefit: Co-operative organisations a result, lack of managerial skills leads to
have a significant role in influencing inefficient management, poor functioning
societal norms and reducing wasteful and difficulty in achieving objectives.
spending. The co-operative organisation Misuse of funds: If the members of
profits are utilised to improve the welfare the managing committee are corrupt,
of their members. they might misuse the funds of the co-
operative organisation. Many co-operative
Disadvantages of co-operatives organisations have faced financial
Despite its numerous advantages, the difficulties and closed down because of
following are some of the disadvantages corruption and misuse of funds.
of co-operatives:
Possibility of conflicts among members:
Limited financial resources: Co-operative Co-operative organisations are based
organisations are always operating on on the principles of co-operation and
limited financial resources resulting from therefore, harmony among members is
low membership dues (fees). This leads to important. But in practice, there might be
a low accumulation of financial resources internal politics, differences in opinions,
which in turn results in a failure of the and quarrels among members which may
co-operative organisations to achieve lead to disputes. Such disputes may affect
intended goals and objectives. the general functioning of co-operative
Reliance on government funds: As co- organisations.
operative societies fail to raise funds
on their own, they sometimes rely on Activity 2.5
government assistance. Heavy reliance
on government assistance may result Consult local government leaders or
in the inability to properly plan their any other persons concerned with
activities. This is because in most cases co-operatives existing in the community.
the government subsidies do not come on Based on the discussion with that person,
time as expected. explain how the co-operatives benefit
Lack of administrative skills: Co- their members and the community.
operative organisations are managed by
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