Starting a New Business Cooperative
If you are forming a co-op, don't accept just anyone, warns Howard Brodsky, the founder of CCA Global Partners, a multibillion-dollar company that manages co-ops and has more than 3,800 members. Some co-ops make the mistake of indiscriminately adding members in the interest of attaining scale quickly, he says. Here's what you should look for in a co-op partner:
Strong reputation in the industry If early members are known as effective sellers or leaders, others will want to join.
Good credit Co-ops must negotiate with manufacturers and others in the business community. Bad apples reflect poorly on the whole barrel.
A mix of skills Look for smart product, marketing, and finance people. Building a co-op is like staffing a company from the ground up.
Ears to the ground A big advantage for retail co-ops is members' closeness to their customers. Choose members who are good at sensing changes in consumer demand.
Compatible personalities Co-op members need to support one another. They often develop close friendships. Don't include anyonewith whom you wouldn't want to go to dinner.