The Effect of Membership Characteristics on Cooperative Pricing Policies and Success

Cooperatives are unique among agribusiness firms because their owners are also their customers. This dual nature of patrons means that maximizing profit is one of several optimal strategies the cooperative may pursue. Using a survey of marketing cooperative managers, we examine how membership characteristics and cooperative structure influence cooperative policies. We also study the relationship between member characteristics, cooperative policies and cooperative success. Longer member planning horizons and independent management make profit or price maximization more likely. Cooperative success does not appear systematically related to membership characteristics or cooperative structure. Evidently, cooperative success is not easily measured or explained.