Cooperative Marketing

The cooperative marketing scheme began throughout India to promote commercial agriculture and bring economic development to rural areas. The objective of cooperative marketing societies was to introduce economic development and bring in new business opportunities for agriculturists and small businesses. The cooperative marketing societies were seen as institutions not only for the betterment of economic growth of agriculture but were also an institution of social justice. The principle behind cooperative marketing is to return the control of the product to the hands of the producers through collective efforts. In a cooperative marketing organisation, all members are the owners. 

Cooperative Marketing

Cooperative marketing essentially stands for two companies’ understanding and willingness to sell or promote products sold by the other company. Cooperative marketing promotes mutual benefit and the type of sales that occur are largely in line with boosting and supporting the products of one another’s companies. The products which are typically sold or promoted under a cooperating marketing agreement are either seasonal or complementary. Through the agreement between two companies, a common objective and goal are set up. That is met through a collective effort. Cooperative marketing is thus simply an agreement between two companies. Sometimes, there are more than two companies involved. Based on this principle is the cooperative marketing society which though appears as a capitalist organisation functions as socialist and collaborative. Through cooperative marketing strategies, businesses can pool their resources and secure similar results to that of big businesses with the profits being earned getting distributed equitably amongst the companies involved. 

Agreement between Two Companies

One of the salient features of cooperating marketing is the agreement between two companies. If the products that are being sold are complementary or are seasonal, then two companies can engage in an agreement where each promises to promote and sell the other’s products for mutual benefit. The agreement between two companies as a part of cooperating marketing has a long history. It started in 1912 with the passing of the Cooperative Marketing Societies Act. There are many advantages to getting into this sort of an agreement:

• Collaborative efforts maximize sales
• Marketing and promotions are boosted due to collaborative efforts
• Very much cost-effective, reducing the net operating costs

The idea of Collective Efforts

The idea of collective efforts is very important in cooperative marketing. Collective action or effort are those conscious decisions and actions performed by a group or a team to gather their resources and achieve a common objective. However, this common objective has to be something that otherwise could not be achieved by an individual alone. In cooperative marketing, it is the collective effort by all members present that make the strategy work. If a product was seasonal, then the total profit earned by selling that product would be limited due to a small window of time. However, for another company promoting the goods of the other company through a joint effort can increase the number of sales. In India, the concept of cooperative societies was very important to deal with certain business malpractices and to give small businesses an opportunity. 

Promotion and Selling of Products

Another salient feature of cooperative marketing was to promote or sell the other companies’ products. This is an important aspect of cooperative marketing because the goodwill and collaboration between the two or more companies are reflected through their willingness to promote and advertise the products of the company. The company also sells its products while it also has the responsibility to promote or sell the other companies’ products. 

Conclusion

Cooperative marketing has been an important feature of the Indian economy, especially in the agricultural sector. The bulk purchases of oilseeds, fertilizers, seeds, and other agricultural outputs greatly benefit from cooperative measures. Through many cooperative marketing strategies, the market price for a given product can be influenced.