Starting a Co-op
In many ways, developing a co-operative business is a lot like developing a traditional business. Where things differ is that a co-op is shaped through collective effort and group decision-making as well as a set of co-operative principles that help to guide the business. This makes the business planning more complex, but it also means the resulting corporation is stronger and more likely to succeed.
IMPORTANT: Not all business and financial advisors are familiar with incorporating and running a co-operative. In addition to working with your own advisors, we suggest you contact On Co-op to assist with the planning and start-up of your co-operative corporation. Contact our Co-op Development Manager at the co-ordinates below.
- Getting started
- Not sure what to do next?
- Developing a co-operative: an online learning course
- Reasons to start a co-op
- Stages of Co-op Formation
- WORKSHOP: Starting a Co-operative
- For more information
There are number of critical steps to follow if you are interested in forming a co-operative. You may already have a core group of people with whom you are working. You may already be a business but would like to convert to a co-operative structure. Perhaps you are not sure what kind of business structure you want.
On Co-op has created Guide to Starting a Co-op, which provides a general overview of the co-op development process that can help you explore the steps required to plan, develop, incorporate and launch your co-operative. This guide can be downloaded at the top right of this page. Some of the text in this section is based on information from the Co-operatives Secretariat and the BC Co-operative Association.
If you are incorporating your co-operative as a non-share capital co-operative (or what is sometimes loosely referred to as a non-profit co-op) check out this link to incorporation on the Ministry of Citizenship and Immigration website.
- Things to consider before incorporating as a non-profit.
- Things to consider before choosig a structure for your new organization
NOT SURE WHAT TO DO NEXT?
Once you've read through the Starting a Co-op Guide, you can search through our co-op resources to see what other sorts of useful materials might be available to you. You can also make an appointment to speak with our co-op development staff to work through your idea and get answers to detailed questions that can help you plan out your next steps. You will find a brief advisory services application form under "downloads" at the right of this page - filling it out and submitting it prior to your appointment will save you valuable time and money. We're also available for more in-depth consultations on a fee for service basis.
If the Co-operative Corporations Act is baffling you, On Co-op has also created a plain-language guide to the Act to help you navigate the legal side of running a co-op. Contact our Co-op Development Manager using the information at the bottom of this page to order a copy or click on the 'for more information' link at right.
DEVELOPING A CO-OPERATIVE: AN ONLINE LEARNING COURSE
- Want to learn more about Developing a Co-op? On Co-op has an e-Learning course that will introduce you to the multi-faceted process of co-operative business development, including how to decide what business structure is right for your business, how to conduct a feasibility study, how to develop a business plan and the role of co-op developers. Once you have registered for this self-study course, it is available to you as a resource 24/7/365.
- The 'Developing A Co-op' e-Learning course includes the following topics: How to identify a business need or opportunity; How to decide on the best business structure; How to develop an economic model to fill the identified need; The importance of leadership as it relates to starting a co-operative; The importance of finance as it relates to starting a co-operative; and The role of co-op developers.
- On Co-op e-Learning courses can be completed in about seven to ten hours, approximately 2-3 hours of which will be spent online. Each course includes a printed course pack and other resources.
- Learn more about this and other e-Learning courses from On Co-op at http://s.coop/coopcourses
REASONS TO START A CO-OP
Historically, people have created co-ops for a variety of reasons:
- out of need to decrease the power that others hold against them in the marketplace and increase their own power, whether it is through purchasing or marketing co-operatives.
- to provide a service that other forms of enterprise are not offering.
- to respond to a local opportunity, or solve a challenge affecting your community/region/group
- as a means of keeping a community or business alive. For example, many workers' co operatives are organized when a private business is no longer able to maintain the industry within that community.
- to provide business continuity when the owner of a small business wishes to retire (succession planning or exit strategy)
- as a means of keeping profits and control of a business within the community, rather than with a large, remotely owned and operated corporation. A co-operative is owned and controlled locally. Therefore, the earnings of the co-operative stay in the community and are directed by members of the community.
WHY START A CO-OPERATIVE?.
- You (and your organizing group) want to respond to a need/challenge/opportunity in your community in a democratic and sustainable way;
- A local or small business is closing and you wish to maintain the business and employment opportunities for your community; or
- Employees wish to buy out their employer and take over the business.
STAGES OF CO-OP FORMATION
On Co-op uses this "aging" classification for co-operative development
In Formation is generally from the organizing committee stage up to the day prior to incorporation
Emerging, or “new” is from day of incorporation up to 5 years
Established is 5 years and older based on date of incorporation as a co-op
WORKSHOP: LEARN ABOUT THE CO-OPERATIVE BUSINESS ENTERPRISE MODEL
Discover the entrepreneurial model that focuses on the triple bottom line, through a workshop by the Ontario Co-operative Association
For details on having this workshop presented to your organization (for example to co-ops in formation, business support organizations or other groups), contact Peter Cameron using the contact links below.
This session will cover the following points:
- Types of co-ops and benefits of the model
- Co-op job creation case studies
- The co-op difference: how do co-ops compare?
- How to incorporate a co-operative
- Raising capital using an Offering Statement
- Sector opportunities for co-op development
- Succession planning and co-op conversions
- Programs for youth
- The Blueprint for a Co-operative Decade
Other ways to learn about co-ops: Attend the Co-operative Management Certificate Program, register for one of On Co-op's e-learning courses on co-operatives, download documents and other information from our website and document library ... or call us and chat. We offer Co-ops 411 (information) and Co-ops 911 (urgent support) services, too.
BECOME A "FRIEND" MEMBER AND REAP THE BENEFITS
JOIN THE ONTARIO CO-OPERATIVE ASSOCIATION. Co-ops under development as well as individuals who are part of the co-op movement are welcome to join On Co-op to take full advantage of our range of products, services, discounted offers and programs.
On Co-op's "Friend" level membership is specifically designed for working groups and newly incorporated co-ops. It includes extra resources and support to assist you in making your co-op a success!
WORK WITH A TRAINED CO-OPERATIVE DEVELOPER
UTILIZE A CO-OP DEVELOPER. A reminder that your own legal or financial advisors may not be familiar with all of the options available to you when organizing as a co-operative business enterprise. We recommend you contact a Co-operative Developer and/or On Co-op in addition to your own trusted advisors to ensure that you have chosen the best enterprise model for you. http://coopzone.coop. (And yes... sometimes that is NOT a co-operative!)
PROVINCIAL AND FEDERAL CO-OPERATIVES
- Want to incorporate a co-operative in Ontario? Check out the co-operative pages of the Financial Services Commision of Ontario for additional information.
- Want to incorporate a co-operative federally? Check out the co-operative pages of Industry Canada for tips on federal incorporation.