The role of cooperatives and the government in distribution trade


A cooperative society is defined as a voluntary business organization in which a group of people with common interests pool their resources to promote the economy and welfare of its members in the production, distribution and consumption of goods and services. Cooperative societies of producers and consumers are engaged in the distribution of products directly from the manufacturer or from wholesalers and sell to their members/consumers at reduced prices.

The government, on the other hand, whether at the federal, state, or local level, has an important role to play in the distribution of goods or commodities. The government can participate in the distribution of basic products by establishing distribution agencies. The role of the government is the distribution of basic products, it is the basic responsibilities that a government must carry out, such as: provision of the transport system, provision of storage facilities, price control, price stabilization, prevention of shortages artificial, importation of essential products and establishment. of the communication system.

The functions of cooperative societies are as follows:
1. Variety of Goods Inventory: Consumer cooperatives buy a variety of goods from the manufacturer or wholesaler, thus they are exposed to a wide range of goods.
2. Sell in small quantities to members: Cooperative societies buy in reasonable quantities from the wholesaler and sell in parts to members.
3. Grant credit facilities to members: The cooperative society may grant facilities to members so that they can immediately enjoy the assets without payment.
4. Giving advice: The cooperative society also gives advice to its members (consumers) as well as to manufacturers/wholesalers.
5. Bring products closer to members: They also ensure that products arrive at the doorstep of consumers (members).
6. Fight Hoarding – They fight hoarding by wholesalers and retainers by making sure to stock batches of products for member (consumer) use.
7. Stabilize prices: They also help stabilize the prices of goods by selling them at affordable prices for members.
8. Elimination of middlemen: They can eliminate the activities of middlemen by buying their products directly from manufacturers and selling them directly to consumers (members).
9. Marketing of members’ products: They also assist their members in marketing their products (ie producer cooperative society) ensuring fair prices for their products.

African countries and other developing nations face the challenges of benefiting from the role of government. Especially in countries where the government is corrupt. They enact policies and form agencies, but they do not function properly to achieve their goals. Take, for example, in Nigeria. Nigerian National Supply Company Limited (NNSC) was created in 1972 to supplement private efforts in product distribution. Now it is dying and as good as if it had not been created. Several marketing boards for various products were established to improve the marketing of products in the country and the River Basin Authorities were also established to encourage large production and distribution of agricultural products. Are these agencies working now? If so, Nigeria would have been much better than its current state.