A cooperative is a collectively owned and democratically controlled business with a social mission.

Although co-ops come in many shapes and sizes, they all share a commitment to seven internationally recognized principles that guide how business is done:

- Voluntary and open membership
- Democratic member control
- Member economic participation
- Concern for community
- Autonomy and independence
- Education, training, and information
- Cooperation among cooperatives

Since cooperatives actively engage with the community, many people think that cooperatives are nonprofit organizations. To the contrary, co-ops are profit-making entities. The difference is that co-ops focus on the triple bottom line: people, planet, AND profit. In fact, you probably do business with some of the most successful ones, such as REI and Land O'Lakes. Click here for profiles of other cooperatives you may be familiar with. Neighborhood storefront or Fortune 500, these businesses are all collectively owned and managed by members.

Members are the community investors whose member share values constitute equity capital for the business. Cooperatives exist to serve their members. Members are active stakeholders. They own the business, democratically make decisions about how it is run, and reap profits proportionate to their use of the cooperative.

Cooperatives work in every sector, and most fall into one of four types types:

- Worker Cooperatives, such as employee-owned restaurants and cab driver associations
- Shared Services Cooperatives, such as employer health insurance alliances and hardware store wholesalers
- Producer Cooperatives, such as groups of dairy farmers and craftspeople
- Consumer Cooperatives, such as parent model childcare and credit unions

Cooperative food markets and buying clubs fall into the last category because these businesses are owned by the people who buy its products.

What is a cooperative food market?

Most cooperative food markets resemble a brick-and-mortar retail grocery store with a healthy, sustainable, local product selection and a lot of character. Hundreds of communities across the world have a local co-op. Every store is different because every local food system is unique.

Check out a sampling of dynamic American food cooperatives, or a national food cooperative directory.

Although non-members may also shop at retail cooperative food stores, members are the primary customer base. Since they care about quality and affordability, members determine the product mix, service policies, and price points. And since they own a share of the business, members earn value on their investment every time they make a purchase.

What is a buying club?

Most buying clubs resemble a group of people who purchase wholesale food and goods, then work together to divide up the group order. Since they share preferences for healthy, sustainably-produced items, they are able to leverage their collective buying power and get discount prices from health foods distributors like United National Foods, Inc. and local producers. Many buying clubs meet at members' homes or community gathering spots, and others partner with food retailers in their neighborhoods who provide convenient order pick-up points with refrigerator space.

Buying clubs often transition naturally into cooperative food markets as growing membership and product selection demonstrate local demand for a brick-and-mortar store. Some buying clubs even start up a co-op seed fund to support the initial organizing process.