What is a co-op?
A cooperative, co-op or coop is defined as relating to a business or organization that is owned and operated by the people who work there or the people who use its services. It is an autonomous association of people united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly owned and democratically controlled business.
Why a co-op?
Co-op principles and values really inspired us to make the change.
Cooperative Principles are the seven guidelines by which coops put their values into practice, often called the seven Rochdale Principles:
- Voluntary and open membership
- Democratic member control
- Economic participation by members
- Autonomy and independence
- Education, training and information
- Cooperation among cooperatives
- Concern for community
Cooperatives Values, in the tradition of its founders, are based on "self-help, self-responsibility, democracy, equality, equity and solidarity." Co-operative members believe in the ethical values of honesty, openness, social responsibility and caring for others.
What is an example of a consumer co-op?
We love that REI is a consumer co-op. It currently has over 6 million members and has done an amazing job with their stewardship programs and commitment to the community. Find out more here: https://www.rei.com/membership/benefits
The Santa Monica Co-op has also been a huge source of inspiration. Learn more about them here: http://www.coopportunity.com
What is Craft, Main & Co.'s capital structure?
Craft, Main & Co. is incorporated as a non-stock corporation. As such, we are currently not issuing shares of stocks as evidence of ownership. However, we are distributing profits through patronage refund which is based on how much each Owner spends at the Co-op, rather than on how many shares each Owner owns.
“Patronage” is defined as refund issued to those who purchase goods or services from a cooperative, and is calculated based upon the amount that each patron spends at the cooperative in a given taxable year. The more you shop, the more you get back in Patronage Refunds.
As a member-owner, am I required to include the patronage dividend I receive in my gross income?
No. A patronage dividend or refund is not required to be included in gross income if the owner’s purchases from the Co-op related to “personal, living or family items." The Internal Revenue Code generally requires each person receiving a patronage refund to include the amount of such distribution in his or her gross income in the taxable year in which it is received except to the extent that such a patronage refund is not income to the member because it is attributable to the purchase of personal, living, or family items,
To learn more about Surplus Allocations and Distributions check out Article IX of our Bylaws.
As a member-owner, am I personally liable for the debts & obligations of the business?
No. Like other forms of corporation, operating as a corporation offers limited liability to shareholders. Shareholders of a cooperative enjoy limited liability for the debts and obligations of the business, including liability for the unlawful acts of other shareholders and employees. For instance, if a fellow shareholder writes a defamatory article or posts copyright infringing material on your jointly-run website or blog, then your liability ordinarily is limited to amounts invested in the cooperative. However, limited liability does not relieve you from personal liability for your own unlawful actions.
For more information: http://www.dmlp.org/legal-guide/cooperative-corporation