Co-ops and Wisconsin Communities

I - Wisconsin Cooperatives in the National Context II - Co-ops and Local Economies III - Cooperative Culture: Perception of Co- ops in WI Communities

I - Wisconsin Cooperatives in the National Context

National Impact Report In 2009, the USDA launched a Congressionally funded study of cooperatives across the country It identified more than 29,000 cooperative businesses in the United States Member-owned businesses generate more than $654 billion in revenue annually They also provide $75 billion in wages for more than 2 million workers

And In Wisconsin The Midwest features the highest concentration of co- ops in the country 2.7 million cooperative memberships in WI Statewide, cooperatives generate over $5.6 billion annually in gross sales, support 30,000 jobs and more than $200 million in state and local taxes

National Impact Report The report suggests that cooperative business is not merely viable, but highly successful, even in the business climate of a national recession While individual cooperatives may be small (or large), their cumulative economic impact on communities is considerable

II - Co-ops and Local Economies

The Multiplier Effect Non-cooperative businesses may provide products and jobs that stay in the community, but revenue is more likely to be spent in other communities (think of executives, international investors, etc) Co-ops contribute to what is called the local multiplier effect

The Multiplier Effect Here’s an example: M. spends $1,000 at a cooperative grocery store in Antigo in a year. Rather than $500 going to salaries and supplies and $500 being sent to pay owners in New York, all $1,000 is disbursed to cooperative members (employees, patrons, suppliers, etc.) These Wisconsinites all choose to buy products from stores in their town, many of them cooperatives

The Multiplier Effect M’s $1,000 of goods produced $1,000 of revenue, which immediately was used to produce another $1,000 of goods and $1,000 of revenue. Through the local multiplier effect, the community of Antigo enjoys $2,000 of goods and $2,000 of revenue from an initial sum of $1,000. From the perspective of the community, money seems to multiply as it cycles through local businesses Cooperative business enacts the multiplier effect by keeping money within a community

“Study Shows Cooperatives Vital To Rural Economic Growth” A government report released in 2004 says that cooperatives are more likely than corporations to have positive economic impact on their community  The report, measuring the Economic Impact of Cooperatives in Minnesota, is a public-private partnership between the Minnesota Association of Cooperatives (now known as Cooperative Network), the USDA/Rural Development, the Minnesota Secretary of State and Minnesota State Colleges and Universities (MnSCU)-Mankato

“Study Shows Cooperatives Vital To Rural Economic Growth” Why? The report explains:  Cooperatives are member-owned, with benefits to local patrons more likely to stay within the community. Other businesses, such as corporations, are more likely to have any benefits in the form of dividends distributed mainly outside the community, and local ownership is often missing It concludes, “The cooperative form of business is an excellent tool in promoting rural economic growth as well as local leadership development”

Discussion How does the structure of cooperative business encourage the positive economic impact described in this report? What role might co-ops play in our community?

III. Popular Perceptions St Norbert’s Co-op Attitudes survey  According to a 2007 telephone survey of 400 residents of Minnesota and Wisconsin, the first words people think of when they hear the term cooperative or co-op is (1) Owned by people for the common good/shareholders - 43% (2) Farming/foods - 18% (3) Lower prices/competitive/quality - 13% (4) Local/community based and owned - 9% (5) Business/dividends/profit sharing - 8% (6) Gas/electric/phone - 4% (7) Other - 3% (8) Credit unions/banks - 2%

Discussion How are popular perceptions important to a business? What sort of words or concepts do you associate with cooperatives?

For more information To find out more about cooperatives in Wisconsin, particularly those located in your community, please visit the Cooperative NetworkCooperative Network This material is made possible by the CHS Foundation.