Cooperatives are businesses owned and controlled by the people who use them. Cooperatives differ from other businesses because they are member owned and operate for the benefit of members, rather than earn profits for investors. Like other businesses, most cooperatives are incorporated under State law. User-owned cooperatives process and market products, purchase production supplies or consumer goods, provide housing and credit, build and operate rural utilities, and provide other services needed by rural residents.
Members use cooperatives to buy food, consumer goods, and business and production supplies.
Farmers use cooperatives to market and process crops and livestock, purchase supplies and services, and to secure credit for their operations. By working together for their mutual benefit in cooperatives, rural residents are often able to reduce costs, obtain services that might otherwise be unavailable, and achieve greater returns for their products . Cooperatives, both rural and urban, have been part of the American economy for more than 100 years. In the United States there are more than 40,000 cooperatives that serve one out of every four citizens. Application of the cooperative business structure in rural economies is virtually limitless.