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Marketing Co‑operative
General
Characteristics
A particular form of co‑operative consortium that sells its
members products and takes a commission on each sale made. Members may
be individuals or organisations or businesses.
Ownership: a marketing co‑operative is owned by
its members.
Charitable status : a marketing co‑operative will
not be eligible for charitable status.
Examples of Use
A group of craftspeople may form a marketing
co‑operative to advertise and sell their products, perhaps through a mail order
catalogue, or a retail outlet, or at craft fairs.
Legal Forms Used
Most are either companies limited by guarantee
or industrial and provident societies, though a marketing co‑operative can be
registered as a company limited by
shares.
Profit
Distribution
Any distribution of profits to members is in
effect a rebate on overpaid commission charged on sales, and thus will commonly
be allowed. However, a marketing co‑operative making a surplus may just reduce
its commission rate
instead.
Participation
Issues
Participation in a marketing co‑operative will generally be restricted to
members.
Some marketing co‑operatives take advantage of tax benefits available to
mutual trading organisations, which require that all participants are members
and only participants may be
members.
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