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Forms of Business Organisation-2 — OCM STD 11 Commerce — Question

Gujarat BoardEnglish MediumSTD 11 CommerceOCMForms of Business Organisation-25 Marks
Question
Explain benefits of Co-operative Society.
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Answer

  • Introduction :
  • The emergence of Co-operative society was quite late in comparison to other business forms in our country.
  • Yet this form has developed very fast and attained much popularity in quite short time.
  • The poor people of our country has taken good benefit of thebenevolent activities of co-operative societies.
  • It has been a trustworthy institution of purchase aln1d9 sales for ignorant and illiterate
  • The Advantages/Benefits Co-operative Society
  • Simple Establishment :
  • Any 10 person voluntarily together, get the society registered before the registar of co-operatives society. The procedure is less complicated and less expensive compare to that of company.
  • Perpetual Existence :
  • Co-operative Society has its own independent existence. It is not dissolved due to death, insanity, insolvency of any member. Member can leave society at any moment but society exists forever.
  • Open Membership :
  • Anybody can become a voluntary member of co-operative society without any discrimination of caste, creed, religion. Thus, membership is open for all.
  • Separate Entity :
  • According to law, Co-operative Society holds separate entity from its members.
  • It can purchase assets, incur debts and file suit for recovery under its name.
  • Government Subsidy :
  • Government holds the society keeping in view its objective of welfare, upliftment, betterment, social activities.
  • The government gives subsidy, loan and grant to society.
  • Democratic Administration :
  • Compare to the management of company, administration of society is carried out through democratic management, because it is based on the principle of one vote one member, one vote per head.
  • In the company the management is on the basis of number of shares.
  • Those who are having more shares dominate the company.
  • Importance is given to an individual so its administration is considered democratic.
  • Economical Administrative expense :
  • Many members of society give honorary service to society.
  • It does not have to incur advertisement expense as goods are sold and purchased with mutual co-operation of members. Beside this, employee performs more than one function at a time.
  • The society is run through less number of employees. Thus its administration ministration is economic.
  • Fixed Customers :
  • Mostly the members of co-operative society are its customeis. Products are sold to members only. No advertisement is required.
  • Strong competitor against Traders :
  • Functions of Co-operative society is not for profit but for service and betterment of its members. The question of adulation of deceit does not arise. It is proved a strong competitor of traders.
  • Social Welfare :
  • It is not that the society functions for its members only. It performs many social activities such as running subsidized dispensary, school, training centers, gardens, parks, health centers, adult education etc.
  • Training School for Democracy :
  • In Co-operative Society importance and weightage is not on capital but humanity. It runs on the basis of vote per head so one can contest election and join management. That is why co-operative society is called an ideal training school for democratic principles.
  • Economics uplift of Members :
  • Co-operative Society provides consumer items to its members at reasonable price and of good quality. It prevents exploitation of members and leads to quality life.
  • Encouragement to Small Scale Manufacture :
  • Co-operative that they can manufacture Societies supply raw material, instruments etc. at reasonable price to small m easily. The development of dairy, sugar, leather , cotton sectors is the outcome of the co-operative society.
  • Conclusion :
  • Co-operative societies have become much popular in the rural area due to their multiple activities and good management.
  • It is associated to the concept that.
  • This is our society not ‘my’ society.

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