How do you set up a co-operative?

Spielfiguren, die auf eine, Kreis stehen und durch Linien verbunden sind als Sinnbild für Genossenschaft

Elf Jahre ist es her, als der damalige UNO-Generalsekretär Ban-Ki Moon das Jahr 2012 zum Internationalen Jahr der Genossenschaften ausrief und damit auf die weltweite Bedeutung dieses Wirtschaftsmodells hinwies. And rightly so, because co-operatives work locally and regionally, operate under their own steam and are independent and not dependent on state subsidies. The co-operative – still a model for the future? nd what is actually at the heart of this type of economy?

The core of a co-operative lies in the idea of joint cooperation and the democratic right of co-determination of its members. A cooperative is a type of economic or business organisation in which people with similar interests or needs come together to jointly pursue economic goals, provide services or produce and sell goods. A cooperative is a type of economic or business organisation in which people with similar interests or needs come together to jointly pursue economic goals, provide services or produce and sell goods.

Example of a co-operative

“Viele Unternehmer, ein Unternehmen” – so lautete mal ein Werbeslogan der Edeka-Zentrale in Hamburg. Edeka gibt es seit 1907. At that time, several retailers joined together to form a cooperative in order to negotiate more favourable conditions with suppliers. To date, eight more cooperatives have been added, in which 4500 merchants are organised. Ein Einzelmodell? No – on the contrary. There were 7000 cooperatives in Germany in 2022. They are a driving economic force and a model for the future, especially in the energy sector.

How do you set up a co-operative?

In order to establish a co-operative, at least three members must come together with the purpose of promoting the co-operative (there is no upper limit). In order to establish a co-operative, at least three members must come together with the purpose of promoting the co-operative (there is no upper limit). There is no prescribed minimum share capital, as is the case with a GmbH, when founding a company that is limited to Germany. As a rule, however, the cooperative requires a certain amount of start-up capital to finance its activities. This capital can be raised through the contributions of the founding members or through other financing options. In order to achieve legal capacity, the cooperative must be entered in the register of cooperatives.

What if I want to become a member of the cooperative myself?

If you want to become a member of the co-operative yourself, you can either found it or submit a written declaration of membership. Anyone who is a member of the LPG (organic market) in Berlin is familiar with this procedure.
It all sounds like a simple process at first, and yet co-operatives are also subject to certain controls. For example, they must belong to an auditing association that checks whether the cooperative is operating economically and supporting the interests of its members before it is founded and then regularly thereafter.

Why are co-operatives so special?

The co-operative is a legal form that pays off and proves its worth, especially in economically turbulent times. It strengthens regional economic cycles and the principle of participation. For example, Dresdner KonsumGenossenschaft is one of the few traditional Dresden companies to have survived the fall of communism, and it can generally be said that economic downturns affect many co-operatives less than other companies. The economic power behind this model was documented at the start of the Year of the Cooperative by the Chairman of the Board of the DGRV (German Cooperative and Raiffeisen Confederation), Dr Eckhard Ott:

“With its 20 million members, the cooperative group unites almost a quarter of the German population. More than 800,000 people work in the cooperative organisation. (…) Co-operatives not only contribute to solving economic challenges, they are also key factors in tackling social tasks: New cooperatives enable the decentralised distribution of renewable energies, they contribute to comprehensive healthcare, take on municipal tasks and organise local supply in rural regions. Many small businesses and freelancers can also achieve more in cooperatives.”

Conclusion: In this respect, it is worth checking whether your own start-up idea has the potential to become a co-operative before founding a company. Or thought the other way round – whether the cooperative is the only way to ensure that the foundation has a future. Sometimes company sales also offer the opportunity to transfer the company into a co-operative and sometimes such a foundation also saves people’s entrepreneurial freedom. This is what happened at the photo agency laif, which saved the photographers from going under in a mass enterprise by turning it into a co-operative.

You can find more information on this topic here: “A win for everyone”

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