HOW TO START A COOPERATIVE ENTERPRISE IN NEW YORK STATE
In starting a cooperative enterprise two things must be considered: first, the kind of business to go into and, second, the method of organization. Any group desiring to engage in a cooperative venture should first of all, through a committee and by consultation with experts, determine what type of enterprise will serve them most effectively. Where competition is unusually keen and profit margins are low, cooperation is less likely to be of service than where the opposite is the case. Whatever enterprise is started men experienced in that business should be consulted as to the location of the business, the stock and equipment needed, the operating capital necessary, etc.
Preliminary organization should likewise be handled by a committee which might estimate the number of persons who would become members, the service each could contribute to the society, etc. Meetings should be held to educate the group in both cooperation and the special need of the undertaking. For this purpose many educational bulletins may be obtained from the Cooperative League of America and other reliable sources.
Actual organization of the society consists of incorporation, election of officers, the adoption of by-laws, and the immediate adoption of a sound system of bookkeeping. No action undertaken before incorporation has any legal effect on an incorporated body, so early incorporation is desirable. The New York State law requires that all firms using the word "cooperation" incorporate under one of the three state cooperative laws. Outside of farmers' cooperatives practically all cooperative societies are incorporated under the Stock Law known as Article III. Copies of these laws may be obtained from the State Department of Farms and Markets. The Department has prepared simple forms for incorporation under this law. When these are filled out and sworn to and the papers filed with the Secretary of State and the County Clerk, the society may legally begin business. The fee of the Secretary of State is $30. A board of directors is named in the incorporation papers and this board, through a paid manager, will transact the society's business. Model by-laws, upon which the by-laws controlling the organization may be based, may be obtained from the State Department of Farms and Markets or from the Cooperative League of America.
THE PRESENT TREND OF COOPERATION
There have been significant developments in the cooperative enterprise in New York in the last two years. In the first place while a number of small groceries closed their doors, the larger cooperatives have grown larger and more prosperous. At last there appear to have developed cooperatives which have passed that critical stage connected with the life of a newly-organized business. One of these larger cooperatives, which did over $200,000 worth of business in 1921, has turned its surplus into its business ever since it started and is now buying more land to erect a second business block in order to take care of expansion which is forced upon it by the growing trade. Another cooperative has established two prosperous branches and is now doing a business of a quarter of a million dollars a year. A third, following a profitable year in which its business amounted to $205,000, is likewise building a new plant. The balance sheets of each of these associations would be the envy of most business undertakings.
A second development is the appearance of a new type of management. A group of younger men and women with a broad background, an intense interest in cooperation and a capacity of growing up with the business is working now to make these cooperatives even more successful. The cooperative movement is likely to grow in pretty close proportion to the ability of these leaders and the men and women they can attach to themselves. Heretofore the greatest handicap of the cooperative movement in this country has been the lack of trained and able leaders.
A third significant development is the adoption by cooperatives of the best methods of management and accounting. Until this had been done the cooperatives had small chance of succeeding. It is probable that cooperatives which lack some of the incentives of the ordinary commercial business will be compelled constantly to adopt the most efficient and advanced type of machinery. In setting this up as a definite standard they will escape the inertia and conservatism that ordinarily characterize large groups, a condition which at the present time is retarding the British cooperative movement. Two years ago accurate accounting was an unusual thing among cooperatives. At the present time practically all the cooperatives in the State have their books gone over periodically by trained public accountants.