Simple Ilustration of Cooperating

All Cooperative Farmers Association
SIMPLIFIED ILLUSTRATION OF CO-OPERATIVE SOCIETY

Let’s take for instance this illustration of a poor villager who has two cows and gets ten litres of milk from it daily and after consumption by his family everyday, he’s still left with a surplus of five liters of milk. What should he do with the surplus?He may wish to sell the extra milk but may not find a customer to purchase them. With this development in mind, what will you like to do if you were in the shoes of this person? Someone may conclude that if I am the one, I will just sell the extra milk in the nearby town or city market. This is a very good resolve. But what if he finds it difficult to sell to anyone in the market? and its obvious that he does not have money to go to the town to sell the milk. What should he now do? Here, it’s clear this poor villager is faced with a problem of selling his extra milk. Do you have any solution for him?

One day that poor villager met a learner of business management or otherwise say; an ASS Team member of ACFA who had earlier been faced with a similar problem. Because he had experience of how to address such situation, he counsel the village farmer by informing him that he is not the only person facing such problem. The ACFA team counselor told the farmer that there are many other farmers in his village facing the same problem that he does not know. He even made it known to him that even in the nearby village, there are others that their milk is wasting away because no buyer want to buy less quantity of milk. And that if they all can come together, they will be able to reason together and find a solution to their common problem. So that henceforth, you all can unitedly collect the surplus milk at a common place and send somebody to the nearby town to sell it. After sale, you can sit together and distribute the money according to your contribution of milk. Of course first you have to deduct all the expenses from the sales proceeds.

Because that villager genuinely needed solution to his problem, he agreed to what the ACFA ASS Team member told him, and within a short period of time, he told other colleagues about this new idea which led to the bringing together of others of like-mind and form jointly own venture which subsequently helped them to become milk producers in his village.

By collecting the milk together in large quantity and selling the milk in the nearby town they were all able to earn money. After that they did not face any problem of finding a market for the surplus milk. This process continued for a long time. One day some body suggested that instead of selling only milk why not produce other milk products like ghee, butter, cheese, milk powder etc. and sell them in the market at a better price? All of them agreed and did the same. They produced quality milk products and found a very good market for their products not only in the nearby town but in the entire country. Just do a reviewing; A poor villager, who was not able to sell five litres of milk in his village, is now selling milk and milk products throughout the nation. He is now enjoying a good life.

How did it happen? Who made it possible? This is the reward of a joint effort or a co-operative spirit.

The term co-operation is derived from the Latin word co-operari, where the word co-operative therefore could means “working together”. So those who want to work together with some common economic objective can form a society which is termed as “co-operative society”. It is a voluntary association of persons who work together to promote their economic interest. It works on the principle of self-help as well as mutual help. The main objective is to provide support to the members. Nobody joins a cooperative society to earn profit. People come forward as a group, pool their individual resources, utilize them in the best possible manner, and derive some common benefit out of it.

In the above example, all producers of milk of a village joined hands, collected the surplus milk at a common place and sold milk and milk products in the market. This was possible because of their joint effort. Individually it would not have been possible either to sell or produce any milk product in that village. They had formed a co-operative society for this purpose.

In a similar way, consumers in a particular locality can join hands to provide goods of their daily need and thus, form a co-operative society. Now they can buy goods directly from the producers and sell those to members at a cheaper price. Why is the price cheaper? Because they buy goods directly from the producer and thereby the middlemen’s profit is eliminated.

Do you think it would have been possible on the part of a single consumer to buy goods directly from the producers? Of course, not. In the same way people can form other types of co-operative societies as well. Let us know about them.