1. How to Establish a Cooperative 3 rd Annual USDA Outreach Conference Virginia State University Petersburg, Virginia March 18, 2010 Tony Banks Virginia Farm Bureau Federation Commodity/Marketing Department Richmond, VA

2. Purpose What Are Cooperatives? Advantages and Disadvantage Development Steps 2

3. What Is A Cooperative? A business Owned and democratically controlled by the people who use its services With benefits distributed equitably to them based on use 3

4. What Is A Cooperative? Purpose Obtain market access or broaden market opportunities Improve product or service quality Reduce costs (purchasing) 4

5. What Is A Cooperative? Extension of grower’s farm Cooperative enhances farming operation Growers own their cooperative. Lack of support for the cooperative means failure. 5

6. Advantages of Cooperatives  User-members drive business  Patronage-based benefits  Market access  Capital pooling  Structure - Easy for large numbers of members to use

7. Disadvantages of Cooperatives  Members have to give up some independence  Time to develop  Group decision-making  Everyone needs to commit to the cooperative  Voting board members have to be producers  Board v. manager responsibilities

8. Cooperative Development Steps Meeting to define economic need/opportunity Exploratory meeting –Potential members –Steering committee/leadership –Education about cooperatives Survey potential members 8

9. Cooperative Development Steps Feasibility study Business plan Legal documents Business startup Board education 9

10. 10 Bill Brockhouse U.S. Department of Agriculture Rural Development Rural Business-Cooperative Service Cooperative Programs Washington, DC bill.brockhouse@wdc.usda.gov Phone: (202) 720-2021

11. 11 Laurette Tucker U.S. Department of Agriculture Rural Development Virginia State Office Richmond, VA laurette.tucker@va.usda.gov Phone: (804) 287-1594

12. Virginia Farm Bureau Federation Cooperative & Enterprise Assistance State’s largest farm membership organization Represent our members’ political, economic and social interests Provide educational, informational and economic services to our members

13. Virginia Farm Bureau Assist individual and groups of producers developing –higher value markets –value-added products –renewable energy enterprises Commodity/Marketing Dept. Virginia Foundation for Agricultural Innovation & Rural Sustainability (VAFAIRS)

14. Virginia Farm Bureau & VAFAIRS VAFAIRS is a USDA-funded Rural Cooperative Development Center Partner with outside experts –USDA –VDACS, VDMME, VEP –VA Cooperative Extension –VA Tech, VSU, Longwood, VCU –Private Consultants –Many Others

15. Virginia Farm Bureau & VAFAIRS Provide assistance new ventures for the following –Project advice –Feasibility study –Surveys and analysis –Business/marketing planning –Grant writing education/assistance –Organizational structure

16. Virginia Farm Bureau & VAFAIRS Provide assistance existing ventures for the following –Organization-wide strategic planning –Board/officer strategic planning –Board/office education –Grant/finance education/assistance

17. Virginia Farm Bureau & VAFAIRS Virtual Business Center www.vafairs.comwww.vafairs.com –FREE on-line business assistance tool Planning Financial modeling Financial statements –Helpful Resource Links Technical services Financial services Educational Conferences & Workshops Price Risk Management

19. VFBF Commodity/Marketing & VAFAIRS** Contacts Al Glass - 804-290-1156, Al.glass@vafb.comAl.glass@vafb.com Tony Banks - 804-290-1114, Tony.banks@vafb.comTony.banks@vafb.com Jonah Bowles 804-290-1117, Jonah.bowles@vafb.comJonah.bowles@vafb.com Chris Cook 804-290-1111, chris.cook@vafb.com **chris.cook@vafb.com Spencer Neale 804-290-1153, Spencer.neale@vafb.comSpencer.neale@vafb.com WWW.VAFB.COMWWW.VAFB.COM WWW.VAFAIRS.COMWWW.VAFAIRS.COM

20. Tony Banks Assistant Director Commodity/Marketing Dept. Virginia Farm Bureau Federation PO Box 27552 Richmond, VA 23261 804-290-1114 Tony.banks@vafb.com