What are some advantages and disadvantages of cooperatives changing to a cooperation what would be the major reason to do so?

Answer 1

Advantages

• Act as 'schools of democracy' due to their democratic member control.
• Inclusive and open membership.
• Facilitate upskilling and capacity building due to their principle of 'education, training and information'.
• Lower economic vulnerability due to risk pooling.
• Greater generation of ideas and debate due to existence of multiple owners.
• Allow for greater input into policy dialogues due to their tendency to federate into larger bodies at national and international levels.
• Collective action can open up national and international markets, as seen with many examples in the Fairtrade market.
• Lower input and distribution costs due to greater economies of scale.

Disadvantages

• possibility of conflict between members;
• longer decision-making process;
• participation of members required for success;
• extensive record keeping necessary;
• less incentive to invest additional capital

· Disadvantages of workers' co-operatives

• Meeting both co-operative aims and business needs requires complex management.
• They can limit your choice of external finance.
• Employment benefits often can't match those offered by other business types.
• Workers' co-operatives can enjoy tax incentives, such as employee share schemes, but most small co-operatives find these too costly to run.

Disadvantages

• possibility of conflict between members;
• longer decision-making process;
• participation of members required for success;
• extensive record keeping necessary;
• less incentive to invest additional capital

· Disadvantages of workers' co-operatives

• Meeting both co-operative aims and business needs requires complex management.
• They can limit your choice of external finance.
• Employment benefits often can't match those offered by other business types.
• Workers' co-operatives can enjoy tax incentives, such as employee share schemes, but most small co-operatives find these too costly to run.

Answer 2

Advantages of cooperatives changing to a corporation may include easier access to capital, greater scalability, and increased ability to attract investors. However, disadvantages may involve a loss of member control, potential conflicts of interest, and increased tax liability. The major reason to make this change would likely be the need for significant growth or expansion that cannot be achieved within the cooperative structure.