Strong Producer Cooperatives in Developing Countries

The analyses revealed that most producer organizations encounter problems like high illiteracy of their members, inheritance of bad image from its predecessors, no trust among members, living in a monopolistic environment and corruption. This study concluded that producer organizations should be considered effective when members either use the services a producer organization offers or if 70% - 100% of the produce produced by the members is sold by the producer organization.

From this follows that membership satisfaction, a sense of ownerships, strategic partnerships and education are among the most critical success factors because producer organizations rely heavily on support of other chain partners and often lack the knowledge to enter international markets. Moreover this study concluded that visionary leadership should be avoided because it can lead to power concentration. Power concentration is not in line with the democratic principles of a cooperative and therefore a cooperative can better be governed by a small group of people. Producer organizations should only explore the areas of diversification and vertical integration when they have the capacity to carry this and when it fits the context. Even though it is important that a producer organization is embedded with it surrounding community a producer organization should only invest in community projects when it is beneficial for the producer organization and when it is aligned with the strategy of the producer organization. The analysis of the multiple case studies and experiences revealed that trust in the cooperative is essential to generate loyalty from the farmers to the cooperative.

The outcomes provide more insights into what these critical success factors entail for producer organizations in developing countries. You can download the whole thesis here to find all the concluding tables and figures. Do not hesitate to contact Jasmijn if you have any questions.

This research contributes to a deeper understanding about the organizational development of producer organizations and factors that determine their successful performance. Additionally the findings of this research are used to form recommendations for intervention strategies of development agencies to facilitate and support capacity building of producer organisations in development countries.