Consumer Co-Operative Store and Proprietary Retails Shop

This article will help you to differentiate between Consumer Co-Operative Store and Proprietary Retails Shop.

Difference # Consumers’ Co-Operative Store:

1. Co-operative store is a co-operative organisation and follows principles of co-operation.

2. Co-operative store aims at offering service to the members and the society. It can never indulge in profiteering, black marketing, etc. It offers maximum social benefits. It can never exploit consumer’s interest.

3. Shareholders will have limited dividend on their shares but they get bonus on their purchases made from the co-operative store at their purchases made from the store at the end of every year. Profit-sharing is linked with purchases.

4. Shareholders need not have many shares as neither profit-sharing nor voting is linked with shares. Every member win have one vote and there is also a ceiling on shareholding by a member. We have economic democracy or equality. Men rule the co-operative store.

5. The owners of the co-operative store do not have adequate business experience and they cannot have direct and close personal contact will all customers. These are their great drawbacks.

6. Usually the co-operative store follows cash and carry system. No free home delivery service is available to all customers.

7. Co-operative store is registered under a special Co-operative Legislation. It must have minimum ten members. It may have Government help.

Difference # Proprietary Retail Shop:

1. Proprietary retail shop is a capitalist form of organisation, owned and managed by individuals as capitalists.

2. Proprietary retail shop aims at profit maximisation and its activities are guided purely by self interest. It may even resort to anti-social activities, e.g., profiteering, black-marketing, creating artificial famines, etc.

3. Shareholders will have dividends on their shares according to the size of annual net profits. Rising dividend with rising profits is a normal feature. Dividend- hunting element is always present in proprietary retail shop.

4. Shareholders or proprietors will have profit-sharing as well as voting rights strictly as per their shareholding power. A member of proprietary retail shop may have any number of shares. Thus, he will have multiple voting rights and capital not men, rule the organisation.

5. The proprietors are men with wide business experience and they do have direct and close personal contact with all customers. These are their great assets in proprietary retail shop.

6. The proprietary store offers credit as well as free home delivery service to its customers. Many customers prefer both and hence, patronize these proprietary retail shops.

7. Proprietary retail shop is registered under partnership or Companies Act if it has 2 or more than 2 members. It cannot have any Special Government help or favour.