BIBLIOGRAPHY BALANGGOY, GIMMA D. APRIL...
BIBLIOGRAPHY
BALANGGOY, GIMMA D. APRIL 2009. Growth of Cooperative: The Case of
Bakun Central Multi-purpose Cooperative: Benguet State University, La Trinidad,
Benguet.
Adviser: Clifton D. Llanes, BS
ABSTRACT
This study was conducted to know the operation of BCMPC particularly its
growth in terms of membership, paid up share capital, total assets, and net surplus; to
determine the factors contributory to the growth of the cooperative and the strategies
employed by the cooperative for further development and improvement.
There was a continuous increase in membership, share capital and total assets of
the cooperative but there were fluctuation in net surplus for the reason that the
cooperatives’ operating capital was diverted to investment on increasing the inventory of
goods the case of robbery that made the net surplus decrease. However, the investment
for selling goods by the cooperative gained significantly contributing to the upward
swing in net surplus. Strategies undertaken by the cooperative include the following: a)
providing loan and distribution of patronage refund for the members, low pricing
commodities and effective management of officers and staff.
The growth in membership is a result of extensive information campaign and
willingness of people to learn. The growth in membership lead to the increase in paid up
share capital, total assets, net shares and profitability.
The officers and staff should continuously and strictly implement the policies on
their different areas of operation so that their assets will continuously grow although
there is a continuous increase in membership, the cooperative should not be complacent.
The personnel have to plan ways and activities to encourage more people to join so that
they can avail of the benefits and services offered, this will help them in their respective
productive projects so that their organization will continuously grow.
ii
TABLE OF CONTENTS
Page
Bibliography……………………………………………………………………… i
Abstract………………………………………………………………………….. i
Table of Contents………………………………………………………………… iii
INTRODUCTION………………………………………………………………. 1
Background of the Study………………………………………………… 2
Statement of the problem………………………………………………… 2
Objectives of the Study………………………………………………….. 3
Scope and Delimitation of the Study……………………………………. 3
Importance of the Study…………………………………………………. 3
REVIEW OF LITERATURE……………………………………………………. 4
METHODOLOGY…………………………………………………………….... 9
Locale and Time of the Study………………………………………….. 9
Respondents of the Study……………………………………………….. 9
Data Gathered…………………………………………………………… 9
Data Collection………………………………………………………….. 9
Data Analysis…………………………………………………………….. 10
RESULT AND DISCUSSION……………………………………………………. 11
Trend in Membership……………………………………………………... 13
Trend in Paid up Share Capital…………………………………………… 15
Trend in Net Surplus……………………………………………………… 17
Trend in Total assets……………………………………………………… 19
iii
Strategies Employed by the
Bakun multipurpose cooperative…………………………………………. 19
Factors Contributing to the
Growth of Cooperative…………………………………………………… 20
SUMMARY, CONCLUSION AND RECOMMENDATION …………….…….. 21
Summary…………………………………………………………………. 21
Conclusions………………………………………………………………. 22
Recommendations………………………………………………………… 22
LITERATURE CITED…………………………………………………………… 23
APPENDIX………………………………………………………………………. 24
A. Regression analysis……………………………………………………. 24
iv
1
INTRODUCTION
Background of the Study
Bakun Central Multipurpose Cooperative (BCMPC) started as an association
named as Mothers Organization. It was an organization formed by residents of central
Bakun through the effort and initiative of Pastor Martin Dulnuan, a pastor of the United
Church of Christ in the Philippines (UCCP). It started on February 4, 1989 with small
group of members. It started as a consumer store selling consumer goods to the members
in the nearby residence.
On March 10, 1990 the members decided to register it as primary cooperative and
it was renamed as Bakun Consumers Cooperative. It continued with the selling of
consumer’s goods and added the selling of farm supplies because it was needed by the
members since most of them are farmers.
Through the continuous growth in membership, Mr. Hilario Fernandez conducted
seminars to refresh the old members regarding the importance of cooperative. Finally, in
December 20, 1991 was registered as Bakun Central Multipurpose Cooperative
(BCMPC) in accordance with the Cooperative Development Authority (CDA) RA. 6938.
Originally, membership in BCMPC was open to all the residents of Poblacion Bakun. But
later on, membership was opened to all the residents in the whole municipality of Bakun.
Members were composed of farmers, youth, the differently abled, and women.
Prospective members must have to undergo the Pre-membership education
seminar (PMES). They also are required to pay the minimum share capital of (P100.00).
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
2
Since BCMPC is considered as one of the millionaire cooperatives in the
municipality of Bakun, a study on its performance is needed to determine or identify
factors contributory to its success which may be duplicated by other cooperative.
Statement of the Problem
As the cooperative has been operating for relatively long period, it is of interest to
know how the cooperative has been performing for the past eleven years. It is hence
important to determine the growth of the cooperative through the years. Furthermore, the
study aimed to seek answers to the following:
1. Is there growth in BCMPC in terms of:
a. membership
b. share capital
c. net surplus
d. total assets
2. What are the factors contributory to the growth of BCMPC?
3. What are the strategies employed by the cooperative for further development?
Objectives of the Study
The study aimed to analyzed the growth of BCMPC. Specifically the objectives of
this study are the following:
1. To assess the growth of the cooperative in terms of:
a. membership
b. share capital
c. net surplus
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
3
d. total assets
2. To determine the factors contributory to the growth of the cooperative
3. To determine the strategies employed by the cooperative for further
development and improvement.
Scope and Delimitation
This study covered the period of operation from 1997-2007 of BCMPC. It also
looked into the factors and strategies of the cooperative that lead to the improvement of
operation in relation to membership, share capital, net surplus, and total assets.
Importance of the Study
The study show the growth trend of the cooperative and associates this to the
various strategies employed by the cooperative. The study hence provides an insight into
some factors that makes the cooperative successful. Such results could be used to
construct models for successful cooperatives especially for rural areas.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
4
REVIEW OF LITERATURE
Definition of Growth
Growth develops and expands to all directions until the whole world is merged to
the system. As a unit, a cooperative increases in size to point where all people in its
trading area are absorbed. The cooperative system has its own remedies to accomplish
this goal. Its service grow both in quantity and in quality commensurate to the needs of
members and the operation of patronage refund and by the watchful guidance and
encouragement given by there cooperative to improve their economic status, members
find themselves actually and actively accumulating of wealth is characteristic of, and
inherent to cooperatives (Onagan, et al., 1973)
Growth important in a cooperative hence it maintains the operation of
cooperatives. The factors that are crucial to the growth of the cooperative are the
increasing of total number of members, total assets, and net surplus of the cooperative.
Organizations growth measured through the continuous information campaign initiated
by officers on the cooperatives privileges, benefits, and advantages that could be received
by members. Expansion of the area of operation also attributed to the increase in
membership in the cooperative and the good performance of the cooperative.
Cooperative Growth
Cooperative Housing Foundation (CHF) International is applying a variety of
existing best practices and methodological tools to help cooperative stakeholders improve
their performance through the Innovating, Measuring and Promoting Poverty Alleviation
by Cooperatives in Transition Societies (IMPPACTS) program. Implemented in Bosnia,
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
5
Mongolia, Rwanda and the Philippines, this initiative is working with cooperative
organizations to develop enabling environments for the growth of cooperatives
businesses in each respective country. Through these activities, the CDA will be able to
effectively and efficiently track performance of cooperatives and assist them in further
developing their attributes and turning their weaknesses into strengths.
This paper examines the factors that affect the annual growth of cooperatives and
investor owned firms (IOF) in Greek diary industry over the period 1990–94. A
comparison based on both cooperative principals and property rights theory is made
between IOFs and cooperatives to study their characteristics. However an empirical work
is required to explain differences, if any, in the growth of the two types of firms within
the same market. The work examines the determinants of the annual growth and it tests
whether significant differences between IOFs and cooperatives exist. Ordinary least
squares results show that both diversification and advertising strategies are important
determinants for IOF growth, while the cooperative growth depends on capital structure
and intensity and these organizations do not effectively apply competitive strategies
(Oustapassidis et al., 2008).
Member equity and its multiple links to the rest of the cooperative are worth
examining closely, for this is an area in which co-ops still have much to learn. Practices
among cooperatives vary widely, and along with examples of healthy cooperative
businesses with strong and growing member equity systems, there are many instances of
neglect of the role of member capital or of inconsistent and irrational organizational
practices.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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If capital is the lifeblood of a business, a co-op's member equity system may
indicate whether that business is anemic or full of vitality. Yet member equity usually is
less evident and less promoted than other features of the cooperative. Even where there
are growing sales and a satisfied membership, there may be a serious capital problem.
Frequently we find that members are owners in name only, with but a token investment in
the co-op. There may be little sense of identity as owners of a business, and little
attention given to whether the cooperative is building equity (Gutknecht 2008).
This article explores the issue of cooperative growth from both an empirical and
theoretical perspective. Using total assets as the measure of cooperative size, we present
long-term, time-series data from seven of the largest regional agricultural cooperatives in
Canada and the United States. We then examine the issue of growth from a theoretical
perspective, integrating the literature on investor-oriented firm growth with the literature
on cooperative growth. The empirical analysis that follows from the theoretical analysis
suggests it is not possible to reject Gibrat's Law for six of the seven cooperatives; that is,
that a cooperative's long-term growth rate is independent of its size. The empirical results
also suggest the growth rate for the cooperatives in the sample is low, perhaps even zero.
Fulton, (2008).
An Act creating the Cooperative Development Authority to promote the viability
and growth of cooperatives as instruments of equity, social justice and economic
development, defining its powers, functions and responsibilities, rationalizing
government policies and agencies with cooperative functions, supporting cooperative
development, transferring the registration and regulation functions of existing
government agencies on cooperatives as such and consolidating the same with the
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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authority, appropriating funds therefore, and for other purposes Cooperative
Development Authority Act (Republic Act No. 6939).
Cooperative as a tool of Development
The Cooperative Development Authority stated that the important role of
cooperative in the development of the country. A cooperative creates employment and
entrepreneurial opportunities for the country unemployed and marginally employed,
affecting broader base ownership of the access to productive resources reducing wide
income gap and guaranteeing equal and even development Saldo, (2005 ).
Objectives of the Cooperative
The primary objectives of the cooperative is to provide goods and services to its
members and thus enable them to attain increase income and savings, investments,
productivity and purchasing power and promote among them equitable distribution of net
surplus through a maximum utilization of economies of scale, cots-sharing and risks
sharing without, however, conducting the affairs of the cooperative for eleemosynary or
charitable purposes (Victor, 2008).
Membership
Members of cooperative may be either natural or juridical persons depending on
the kind of cooperative. In a primary cooperative only a natural person who is a citizen of
the Philippine is eligible for membership, while in secondary or tertiary cooperatives,
members may either cooperative or non-profit organization with juridical personality.
Members of the cooperative must individually contribute a certain amount known as
share capital, as requirement for organization of the cooperative.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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In addition, Anastacio ( 2004 ), stated that a cooperative is a dynamic form of
business enterprise that embodies the philosophy of cooperation. It state that through
voluntary asset of people to form themselves into a group for the promotion of their
common needs by mutual action, democratic control and sharing of economic benefits on
the basis of patronage by members.
Everybody is encouraged to participate in all affairs of the organization from
planning to management. It is democratic in its government that the members are treated
with respect and dignity. The officers and members are equally exposed to trainings and
education to improve their attitudes, and values and skills, indeed, cooperatives provide a
fertile ground for members to pursue their own development and growth with their
capabilities and inclination. In a cooperative members are treated equally. They are
willing to sacrifice for a common good and even give away part of their resources for a
common good. (Anastacio 2004).
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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METHODOLOGY
Locale and time of the study
This study was conducted at Poblacion, Bakun, Benguet where Bakun Central
Multipurpose Cooperative (BCMPC) is located. This was conducted on the second
semester of school year 2008-2009.
Respondents of the study
The respondent of the study was the manager, officers and some members of
BCMPC. Secondary data was retrieved from the annual financial reports of the
cooperative.
Data Gathering
The data gathered was the background information of BCMPC, as well as the
annual financial statements and other written documents about the cooperative.
Data Collection
Financial reports and other written documents of the cooperative was used to
gather information and data needed in the study that will be further supplemented by the
manager and some members who was personally interviewed.
Data Analysis
The historical data gathered was analyzed using trend analysis where:
Trend line = a+bx where:
a = (intercept)
a = y – bx
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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b = slope of trend line
= S(x-x)(y-y)
S(x-x)2
x = Assigned values to represent the year
y = Actual data
x = Average x
y = Average y
s = √ S (xt – Regression Value t)2
n
The standard deviation was used to determine any considerable deviation of
actual data from the trend line in order to identify significant change through time.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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RESULTS AND DISCUSSION
Membership
Figure 1 shows the trend in membership in BCMPC. It is observed that from 1997-2003,
there was a slow increase in membership. During these years, there were a significant
number of additional members; however, there were some members who were culled
from the cooperative due to delinquency. Over all, there still was a growth in the
cooperative’s membership since the added number of members exceeded the number of
members removed from the cooperative.
As shown in table 1, there was a significant increase in membership starting on 2004.
This sudden increase in annual membership is due to the decrease in the number of
members being culled from the cooperative due to delinquency. This indicates a decrease
in the cooperatives rate of delinquency which in turn indicates an improved system of
collection or a better appreciation and responsibility of members on their obligations.
The slope of the trend line, b= 45.98, indicators an average increase in
membership by 45.98 or 46 members a year. The continuous increase in membership is
due to the fact that the people join the cooperative as they understand that its services,
particularly its loan services will benefit them given its relatively low interest rate and its
comparatively quicker period to avail of the loan.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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Table 1. Number of members in BCMPC
REGRESSION
YEAR
MEMBERSHIP VALUE
DEVIATION
1997
159
77.18
81.82 *
1998
178
123.16
54.84
1999
187
169.14
17.85
2000
201
215.12
14.12
2001
207
261.1
54.1
2002
211
307.08
96.08 *
2003
234
353.06
119.06*
2004
348
399.04
51.04
2005
452
445.02
6.98
2006
556
491
65
2007
645
536.98
108.02*
Std. deviation
70.78
*significant deviation from the trend line
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
13
Figure 1.1 Trend in membership
Paid-up Share Capital
Table 2 shows that the paid up share capital from 1997 had been continuously
increasing. The increase in paid up share capital was due to the continuous increase in the
number of members. The new members brought in additional share capital. The total paid
up share capital in 1997 was P441, 912.23 and this increased to P548, 796.35 in 1998.
Table 2 shows that there is a significant deviation from the trend line from the
years 2002, 2004, and 2007. For 2002, there was a growth in paid up share capital though
it was slight only. This was followed by a surge in the following year and then a slight
increase in 2004. From then there has been a constant surge in paid up share capital.
The increase in paid- up share capital is directly related to the increase in
membership. The actual data shows a similar slow growth from 1997 to 2003, then a
surge in growth after that.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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Table 2 Paid-up share capital
REGRESSION
YEAR
PAID-UP
VALUE
DEVIATION
1997
441,912.23
(376,523.5947)
(818,435.82) *
1998
548,796.35
53,849.4653
(494,946.88)
1999
651,975.53
484,222.5253
(167,753.00)
2000
699,389.17
914,595.5853
215,206.42
2001
710,889.17
1,344,968.645
634,079.48
2002
970,071.52
1,775,341.705
805,270.19 *
2003
1,664,137
2,205,714.765
541,577.77
2004
1,745,560.07
2,636,087.825
890,527.76*
2005
2,903,736.33
3,066,460.885
162,724.56
2006
4,016,544.46
3,496,833.945
(519,710.51)*
2007
5,175,746.52
3,927,207.005
(1,248,539.51)
Std. deviation
672,955.27
* Significant deviation from trend line
The slope of the trend line, b= 430373.05, indicates an average increase in paid up
share capital about P430, 373.05 share capital a year.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
15
Figure 2.1 Trend in paid up share capital
Net Surplus
As shown in table 3. The cooperative has been generating positive net surplus
through the years though this has met drastic fluctuation.
Figure 3 shows the graph of net surplus against the year. Net surplus drastically
decreased in 1998 for the reason that the cooperatives’ operating capital was diverted to
investment on increasing the inventory of goods. In 1999-2001 this increased volume of
operations significantly contributing to the upward swing in net surplus. It reaches its
peak in 2001 then a drastic decrease in 2002 due to extraordinary loss due to robbery.
After this, the cooperative was able to somewhat increase the net surplus reaching its
highest peaks in 2007, barring a decrease in 2005.
The slope of the trend line, b= 20,498.94, indicates an average increase in net
surplus of about P20, 498.94 a year.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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Table 3 Net surplus
YEAR
SURPLUS
REGRESSION VALUE DEVIATION
1997
411,813.68
272,684.62
139,129.06
1998
90,922.39
293,183.56
(202,261.17)*
1999
274,568.31
313,682.50
(39,114.19)
2000
512,054.58
334,181.43
177,873.15
2001
646,682.04
354,680.37
292,001.67*
2002
173,340.52
375,179.31
(201,838.79)*
2003
230,200.04
395,678.24
(165,478.2)
2004
339,154.46
416,177.18
(77,022.72)
2005
202,320.87
436,676.12
(234,355.25)*
2006
572,911.82
457,175.06
115,736.76
2007
673,003.67
477,673.99
195,329.68*
Std.deviation
4,126,972.38
*Significant deviation from trend line
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
17
Figure 3.1: Trend in net surplus
Total Assets
Figure 4 shows the graphical display of total assets from 1997-2007. Table 4
shows that there are significant deviations from the trend line for 1997, 2002, 2003, 2007.
In 2002 to 2003, the growth in assets met a slow down due to mismanagement of funds,
according to the manager. However, 2004 showed a significant increase. This is the effect
after strictest implementations of policies to safeguard the operation of the cooperative
were instituted. Further increases are observed for the following years.
The slope of the trend line, b=1,327,289.7, indicates that for every year, the value
of total assets increase on the average by P1, 327,289.70.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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Table 4. Total assets
REGRESSION
YEAR
ASSETS
VALUE
DEVIATION
1997
1,867,113.39
384,763.43
1,482,349.96*
1998
1,880,507.7
1,712,053.1
168,454.16
1999
2,981,255.37
3,039,342.78
(58,087.41)
2000
4,119,819.69
4,366,632.46
(246,812.77)
2001
5,576,235.79
5,693,922.14
117,686.35
2002
5,755,001.55
7,021,211.81
(1,266,210.26)*
2003
5,826,239.47
8,348,501.49
(2,522,262.02)*
2004
10,459,048.42
9,675,791.17
783,257.25
2005
11,021,237.82
11,003,080.84
18,156.98
2006
12,923,299.95
12,330,370.52
592,929.43
2007
14,823,570.78
13,657,660.2
1,165,920.58*
Std. deviation
1,069,991.83
* Significant deviation from trend line
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
19
Figure 4.1: Trend in total assets
Strategies employed by the Bakun Central
Multipurpose Cooperative
As stated by the members and the staff of BCMPC. The following are some
strategies employed by the cooperative.
a. Members can avail loans and services of the cooperative
b. Patronage refund
c. There are some programs of the cooperative that leads the member to join like
organic farming to improve farm management.
d. Promotes low pricing commodities.
e. The cooperative creates funds in order to grant loans for production and
provident purpose.
f. Effective management of officers and staff.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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Factors Contributing to the Growth of Cooperative
The manager identified the following factors that contribute to the growth of
Bakun Central Multipurpose Cooperative.
1. Organizations growth measured through the continuous information campaign
initiated by officers on the cooperative privileges, benefits and advantages that could be
received by the members.
2. Expansion of the area of operation also attributed to the increase in membership
of the cooperative and the good performance of the cooperative,
3. Continuous training and education of the officers, members and employees,
4. Presence of effective, honest, and dedicated cooperative and community
leaders.
5. Dependence of self-help process in achieving their programs and projects
6. Efficient service for the promotion of social and economic advancement of the
cooperative members,
7. Good public relation.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
21
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
Summary
This study was conducted to assess the growth of Bakun Central Multi-purpose
Cooperative in Bakun, Benguet. It aimed to document the BCMPC operation in terms of
the number of its members, the trend in its share capital, total assets, and net surplus; to
determine factors contributory to the growth and performance of the cooperative and the
strategies employed by the cooperative for its development and improvement.
The increase in membership coupled with the decrease in culling of delinquent
membership contributed to a significant increase in membership starting 2004. The
decrease delinquency reflects the cooperative’s improved collection system or better
appreciation of members on their obligations to the cooperative. The continued growth in
membership is because of people’s appreciation of the benefits of the cooperative’s
service.
The pattern of the growth or increase in paid- up share capital is similar to that of
membership, hence, the growth in paid-up share capital for the cooperative is closely
related to the growth in membership.
There is a fluctuation in the growth in net surplus though it remains positive
through the years. The trend line shows general growth through the years.
In general, the trend line shows an annual growth in assets. Actual data, however,
shows a slowdown in asset growth for 2003 to 2004 due to mismanagement of funds.
Over all, the cooperative shows annual growth in membership, paid- up share
capital, assets, and net surplus.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
22
Conclusions
Based from the results and findings, the following conclusions were derived:
1. There is a continued growth in membership in BCMPC due to better
understanding of members on their responsibilities to the cooperative and because the
cooperative offers services being truly what the community people need.
2. The growth of the cooperative is primarily dependent on the growth in
membership, considering their appreciation of its services.
3. The cooperative has managed to maintain a positive net surplus through the years.
Recommendations
From the conclusions and lessons learned from the cooperative’s performance, the
following are recommended:
1. For cooperatives to understand the virtue of the “continuous cooperative
education” principle. Cooperatives would benefit from educating and reminding members
or perspective members on their responsibilities towards the cooperative and its
implication.
2. Improving cooperative’s delivery of services. A cooperative’s sustained
growth in membership hinges on the appropriateness of the services it offers to the
community’s appreciation of the benefits derived from this services. This insinuates that
cooperatives must make sure that the service they would offer are those truly needed by
and beneficial to the community. A cooperative education campaign would be
recommended to market the cooperative’s services which consequently will increase
membership.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
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LITERATURE CITED
ANASTACIO, L. K. (2004). Profile of primary cooperatives in Itogon, Benguet. BS
Thesis. Benguet State University. La Trinidad, Benguet.
COOPERATIVE BUSINESS DEVELOPMENT. 1999. CHF International. Retrieved
April 3, 2009 from http://www.chfhq.org/node/27984.
COOPERATIVE DEVELOPMENT AUTHORITY ACT (Republic Act No. 6939).
2000. The cooperative development authority republic act no. 6939 of 1990
republic of the Philippines congress of the Philippines Retrieved April 3, 2009
from http://www.ilo.org/dyn/natlex/natlex_browse.details.
FULTON, M. E. and J. R. FULTON. 2008. Cooperative growth: Is it constrained.
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journal/112476/abstract.
GUTKNECHT, D. 2008. Cooperative Capital and Member Equity Systems: The Heart of
Cooperatives. Retrieved April 3, 2009 from http://www.cooperative grocer. Coop/
articles/index.php? id=73.
ONAGAN, D. L. 1973. Cooperative principle and practices. Onagan and sons publisher,
Quezon City.Pp.91-99.
OUSTAPASSIDIS, K., A. VLACHVEI and K. KARANTININIS 2008. Growth of
Invest or Owned and Cooperative Firms in Greek Dairy Industry. Retrieved April
3, 2009 from http://www3.nterscience wiley.com/journal/119137 085/abstract?
CRET=1SRETRY.
SALDO, C. (2005). Profile of non-operating cooperatives in Bagulin, La Union. BS
Thesis. Benguet State University. La Trinidad, Benguet.
VICTOR, A. K. (2008). Members perceived from service. BS Thesis. Benguet State
University. La Trinidad, Benguet.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
24
APPENDIX A
Regression Analysis
Table 1. Appendix Table, Summary Output of Membership
REGRESSION STATISTICS
Multiple R
0.8991455
R Square
0.8084627
Adjusted R Square
0.7871807
Standard Error
78.24525
Anova table
df
SS
MS
F
Significance F
Regression
1
232576
232576
37.98822 0.000166
Residual
9
55100.87
6122.319
Total
10
287676.9
Coefficients Standard Error
t Stat
P-value
Intercept
31.2
50.59884
0.616615
0.552765
X Variable
45.981818
7.460392
6.163459
0.000166
Growth of Cooperative: The Case of B akun Central
Multi-purpose Cooperative / Gemma D. Ba langoy. 2009
25
Table 2. Appendix Table, Summary Output of Paid up share capital
REGRESSION STATISTICS
Multiple R
0.896401
R Square
0.803534
Adjusted R^2
0.781705
Standard Error
743980
Observations
11
Anova Table
anova
df
SS
MS
F
Significance F
Regression
1
2.03743E+13 2.03743E+13 36.8095288 0.000186561
Residual
9
4.98156E+12 5.53506E+11
Total
10
2.53559E+13
Standard
Upper
Coeff.
Error
t Stat
P-value
Lower 95%
95%
Intercept
-806896.66 481109.42 -.677158
0.12782 -1895241.768
281448.46
X
Variable
1
430373.05 70935.714
6.06709
0.00019
269905.32 590840.79
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
26
Appendix Table 3, Summary output of net surplus
Regression Statistics
Multiple R
0.969008876
R Square
0.938978202
Adjusted R^2
0.932198002
Standard Error
1182920.475
Observations
11
Anova Table
df
SS
MS
F
Significance F
Regression
1
1.94E+14
1.94E+14 138.48828
9.09E-07
Residual
9
1.26E+13
1.40E+12
Total
10
2.06E+14
Coeffi-
cients
Standard Error
t Stat
P-value
Lower 95%
Intercept
-942526.25
764958.94
-1.23213 0.24912
-2672983.58
X Variable 1
1327289.7
112787.04
11.7681 9.09E-07
1072147.66
Appendix table 4, Summary Output of Total Assets
Regression Statistics
Multiple R
0.337644655
R Square
0.114003913
X Variable 1
1327289.7
Adjusted R^2
0.015559904
Standard Error
199784.807
Observations
11
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
27
Anova table
df
SS
MS
F
Significance F
Regression
1 46222707634 46222707634 1.15805841 0.309868489
Residual
9 3.59226E+11 39913969128
Total
10 4.05448E+11
Standard
Lower
Coefficients
Error
t Stat
P-value
95%
Upper 95%
Intercept
252185.68 129194.80 1.95198 0.08270 -40073.26 544444.623
X Variable
1
20498.937 19048.73 1.07613 0.30987 -22592.29 63590.1672
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
BALANGGOY, GIMMA D. APRIL 2009. Growth of Cooperative: The Case of
Bakun Central Multi-purpose Cooperative: Benguet State University, La Trinidad,
Benguet.
Adviser: Clifton D. Llanes, BS
ABSTRACT
This study was conducted to know the operation of BCMPC particularly its
growth in terms of membership, paid up share capital, total assets, and net surplus; to
determine the factors contributory to the growth of the cooperative and the strategies
employed by the cooperative for further development and improvement.
There was a continuous increase in membership, share capital and total assets of
the cooperative but there were fluctuation in net surplus for the reason that the
cooperatives’ operating capital was diverted to investment on increasing the inventory of
goods the case of robbery that made the net surplus decrease. However, the investment
for selling goods by the cooperative gained significantly contributing to the upward
swing in net surplus. Strategies undertaken by the cooperative include the following: a)
providing loan and distribution of patronage refund for the members, low pricing
commodities and effective management of officers and staff.
The growth in membership is a result of extensive information campaign and
willingness of people to learn. The growth in membership lead to the increase in paid up
share capital, total assets, net shares and profitability.
The officers and staff should continuously and strictly implement the policies on
their different areas of operation so that their assets will continuously grow although
there is a continuous increase in membership, the cooperative should not be complacent.
The personnel have to plan ways and activities to encourage more people to join so that
they can avail of the benefits and services offered, this will help them in their respective
productive projects so that their organization will continuously grow.
ii
TABLE OF CONTENTS
Page
Bibliography……………………………………………………………………… i
Abstract………………………………………………………………………….. i
Table of Contents………………………………………………………………… iii
INTRODUCTION………………………………………………………………. 1
Background of the Study………………………………………………… 2
Statement of the problem………………………………………………… 2
Objectives of the Study………………………………………………….. 3
Scope and Delimitation of the Study……………………………………. 3
Importance of the Study…………………………………………………. 3
REVIEW OF LITERATURE……………………………………………………. 4
METHODOLOGY…………………………………………………………….... 9
Locale and Time of the Study………………………………………….. 9
Respondents of the Study……………………………………………….. 9
Data Gathered…………………………………………………………… 9
Data Collection………………………………………………………….. 9
Data Analysis…………………………………………………………….. 10
RESULT AND DISCUSSION……………………………………………………. 11
Trend in Membership……………………………………………………... 13
Trend in Paid up Share Capital…………………………………………… 15
Trend in Net Surplus……………………………………………………… 17
Trend in Total assets……………………………………………………… 19
iii
Strategies Employed by the
Bakun multipurpose cooperative…………………………………………. 19
Factors Contributing to the
Growth of Cooperative…………………………………………………… 20
SUMMARY, CONCLUSION AND RECOMMENDATION …………….…….. 21
Summary…………………………………………………………………. 21
Conclusions………………………………………………………………. 22
Recommendations………………………………………………………… 22
LITERATURE CITED…………………………………………………………… 23
APPENDIX………………………………………………………………………. 24
A. Regression analysis……………………………………………………. 24
iv
1
INTRODUCTION
Background of the Study
Bakun Central Multipurpose Cooperative (BCMPC) started as an association
named as Mothers Organization. It was an organization formed by residents of central
Bakun through the effort and initiative of Pastor Martin Dulnuan, a pastor of the United
Church of Christ in the Philippines (UCCP). It started on February 4, 1989 with small
group of members. It started as a consumer store selling consumer goods to the members
in the nearby residence.
On March 10, 1990 the members decided to register it as primary cooperative and
it was renamed as Bakun Consumers Cooperative. It continued with the selling of
consumer’s goods and added the selling of farm supplies because it was needed by the
members since most of them are farmers.
Through the continuous growth in membership, Mr. Hilario Fernandez conducted
seminars to refresh the old members regarding the importance of cooperative. Finally, in
December 20, 1991 was registered as Bakun Central Multipurpose Cooperative
(BCMPC) in accordance with the Cooperative Development Authority (CDA) RA. 6938.
Originally, membership in BCMPC was open to all the residents of Poblacion Bakun. But
later on, membership was opened to all the residents in the whole municipality of Bakun.
Members were composed of farmers, youth, the differently abled, and women.
Prospective members must have to undergo the Pre-membership education
seminar (PMES). They also are required to pay the minimum share capital of (P100.00).
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
2
Since BCMPC is considered as one of the millionaire cooperatives in the
municipality of Bakun, a study on its performance is needed to determine or identify
factors contributory to its success which may be duplicated by other cooperative.
Statement of the Problem
As the cooperative has been operating for relatively long period, it is of interest to
know how the cooperative has been performing for the past eleven years. It is hence
important to determine the growth of the cooperative through the years. Furthermore, the
study aimed to seek answers to the following:
1. Is there growth in BCMPC in terms of:
a. membership
b. share capital
c. net surplus
d. total assets
2. What are the factors contributory to the growth of BCMPC?
3. What are the strategies employed by the cooperative for further development?
Objectives of the Study
The study aimed to analyzed the growth of BCMPC. Specifically the objectives of
this study are the following:
1. To assess the growth of the cooperative in terms of:
a. membership
b. share capital
c. net surplus
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
3
d. total assets
2. To determine the factors contributory to the growth of the cooperative
3. To determine the strategies employed by the cooperative for further
development and improvement.
Scope and Delimitation
This study covered the period of operation from 1997-2007 of BCMPC. It also
looked into the factors and strategies of the cooperative that lead to the improvement of
operation in relation to membership, share capital, net surplus, and total assets.
Importance of the Study
The study show the growth trend of the cooperative and associates this to the
various strategies employed by the cooperative. The study hence provides an insight into
some factors that makes the cooperative successful. Such results could be used to
construct models for successful cooperatives especially for rural areas.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
4
REVIEW OF LITERATURE
Definition of Growth
Growth develops and expands to all directions until the whole world is merged to
the system. As a unit, a cooperative increases in size to point where all people in its
trading area are absorbed. The cooperative system has its own remedies to accomplish
this goal. Its service grow both in quantity and in quality commensurate to the needs of
members and the operation of patronage refund and by the watchful guidance and
encouragement given by there cooperative to improve their economic status, members
find themselves actually and actively accumulating of wealth is characteristic of, and
inherent to cooperatives (Onagan, et al., 1973)
Growth important in a cooperative hence it maintains the operation of
cooperatives. The factors that are crucial to the growth of the cooperative are the
increasing of total number of members, total assets, and net surplus of the cooperative.
Organizations growth measured through the continuous information campaign initiated
by officers on the cooperatives privileges, benefits, and advantages that could be received
by members. Expansion of the area of operation also attributed to the increase in
membership in the cooperative and the good performance of the cooperative.
Cooperative Growth
Cooperative Housing Foundation (CHF) International is applying a variety of
existing best practices and methodological tools to help cooperative stakeholders improve
their performance through the Innovating, Measuring and Promoting Poverty Alleviation
by Cooperatives in Transition Societies (IMPPACTS) program. Implemented in Bosnia,
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
5
Mongolia, Rwanda and the Philippines, this initiative is working with cooperative
organizations to develop enabling environments for the growth of cooperatives
businesses in each respective country. Through these activities, the CDA will be able to
effectively and efficiently track performance of cooperatives and assist them in further
developing their attributes and turning their weaknesses into strengths.
This paper examines the factors that affect the annual growth of cooperatives and
investor owned firms (IOF) in Greek diary industry over the period 1990–94. A
comparison based on both cooperative principals and property rights theory is made
between IOFs and cooperatives to study their characteristics. However an empirical work
is required to explain differences, if any, in the growth of the two types of firms within
the same market. The work examines the determinants of the annual growth and it tests
whether significant differences between IOFs and cooperatives exist. Ordinary least
squares results show that both diversification and advertising strategies are important
determinants for IOF growth, while the cooperative growth depends on capital structure
and intensity and these organizations do not effectively apply competitive strategies
(Oustapassidis et al., 2008).
Member equity and its multiple links to the rest of the cooperative are worth
examining closely, for this is an area in which co-ops still have much to learn. Practices
among cooperatives vary widely, and along with examples of healthy cooperative
businesses with strong and growing member equity systems, there are many instances of
neglect of the role of member capital or of inconsistent and irrational organizational
practices.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
6
If capital is the lifeblood of a business, a co-op's member equity system may
indicate whether that business is anemic or full of vitality. Yet member equity usually is
less evident and less promoted than other features of the cooperative. Even where there
are growing sales and a satisfied membership, there may be a serious capital problem.
Frequently we find that members are owners in name only, with but a token investment in
the co-op. There may be little sense of identity as owners of a business, and little
attention given to whether the cooperative is building equity (Gutknecht 2008).
This article explores the issue of cooperative growth from both an empirical and
theoretical perspective. Using total assets as the measure of cooperative size, we present
long-term, time-series data from seven of the largest regional agricultural cooperatives in
Canada and the United States. We then examine the issue of growth from a theoretical
perspective, integrating the literature on investor-oriented firm growth with the literature
on cooperative growth. The empirical analysis that follows from the theoretical analysis
suggests it is not possible to reject Gibrat's Law for six of the seven cooperatives; that is,
that a cooperative's long-term growth rate is independent of its size. The empirical results
also suggest the growth rate for the cooperatives in the sample is low, perhaps even zero.
Fulton, (2008).
An Act creating the Cooperative Development Authority to promote the viability
and growth of cooperatives as instruments of equity, social justice and economic
development, defining its powers, functions and responsibilities, rationalizing
government policies and agencies with cooperative functions, supporting cooperative
development, transferring the registration and regulation functions of existing
government agencies on cooperatives as such and consolidating the same with the
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
7
authority, appropriating funds therefore, and for other purposes Cooperative
Development Authority Act (Republic Act No. 6939).
Cooperative as a tool of Development
The Cooperative Development Authority stated that the important role of
cooperative in the development of the country. A cooperative creates employment and
entrepreneurial opportunities for the country unemployed and marginally employed,
affecting broader base ownership of the access to productive resources reducing wide
income gap and guaranteeing equal and even development Saldo, (2005 ).
Objectives of the Cooperative
The primary objectives of the cooperative is to provide goods and services to its
members and thus enable them to attain increase income and savings, investments,
productivity and purchasing power and promote among them equitable distribution of net
surplus through a maximum utilization of economies of scale, cots-sharing and risks
sharing without, however, conducting the affairs of the cooperative for eleemosynary or
charitable purposes (Victor, 2008).
Membership
Members of cooperative may be either natural or juridical persons depending on
the kind of cooperative. In a primary cooperative only a natural person who is a citizen of
the Philippine is eligible for membership, while in secondary or tertiary cooperatives,
members may either cooperative or non-profit organization with juridical personality.
Members of the cooperative must individually contribute a certain amount known as
share capital, as requirement for organization of the cooperative.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
8
In addition, Anastacio ( 2004 ), stated that a cooperative is a dynamic form of
business enterprise that embodies the philosophy of cooperation. It state that through
voluntary asset of people to form themselves into a group for the promotion of their
common needs by mutual action, democratic control and sharing of economic benefits on
the basis of patronage by members.
Everybody is encouraged to participate in all affairs of the organization from
planning to management. It is democratic in its government that the members are treated
with respect and dignity. The officers and members are equally exposed to trainings and
education to improve their attitudes, and values and skills, indeed, cooperatives provide a
fertile ground for members to pursue their own development and growth with their
capabilities and inclination. In a cooperative members are treated equally. They are
willing to sacrifice for a common good and even give away part of their resources for a
common good. (Anastacio 2004).
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
9
METHODOLOGY
Locale and time of the study
This study was conducted at Poblacion, Bakun, Benguet where Bakun Central
Multipurpose Cooperative (BCMPC) is located. This was conducted on the second
semester of school year 2008-2009.
Respondents of the study
The respondent of the study was the manager, officers and some members of
BCMPC. Secondary data was retrieved from the annual financial reports of the
cooperative.
Data Gathering
The data gathered was the background information of BCMPC, as well as the
annual financial statements and other written documents about the cooperative.
Data Collection
Financial reports and other written documents of the cooperative was used to
gather information and data needed in the study that will be further supplemented by the
manager and some members who was personally interviewed.
Data Analysis
The historical data gathered was analyzed using trend analysis where:
Trend line = a+bx where:
a = (intercept)
a = y – bx
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
10
b = slope of trend line
= S(x-x)(y-y)
S(x-x)2
x = Assigned values to represent the year
y = Actual data
x = Average x
y = Average y
s = √ S (xt – Regression Value t)2
n
The standard deviation was used to determine any considerable deviation of
actual data from the trend line in order to identify significant change through time.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
11
RESULTS AND DISCUSSION
Membership
Figure 1 shows the trend in membership in BCMPC. It is observed that from 1997-2003,
there was a slow increase in membership. During these years, there were a significant
number of additional members; however, there were some members who were culled
from the cooperative due to delinquency. Over all, there still was a growth in the
cooperative’s membership since the added number of members exceeded the number of
members removed from the cooperative.
As shown in table 1, there was a significant increase in membership starting on 2004.
This sudden increase in annual membership is due to the decrease in the number of
members being culled from the cooperative due to delinquency. This indicates a decrease
in the cooperatives rate of delinquency which in turn indicates an improved system of
collection or a better appreciation and responsibility of members on their obligations.
The slope of the trend line, b= 45.98, indicators an average increase in
membership by 45.98 or 46 members a year. The continuous increase in membership is
due to the fact that the people join the cooperative as they understand that its services,
particularly its loan services will benefit them given its relatively low interest rate and its
comparatively quicker period to avail of the loan.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
12
Table 1. Number of members in BCMPC
REGRESSION
YEAR
MEMBERSHIP VALUE
DEVIATION
1997
159
77.18
81.82 *
1998
178
123.16
54.84
1999
187
169.14
17.85
2000
201
215.12
14.12
2001
207
261.1
54.1
2002
211
307.08
96.08 *
2003
234
353.06
119.06*
2004
348
399.04
51.04
2005
452
445.02
6.98
2006
556
491
65
2007
645
536.98
108.02*
Std. deviation
70.78
*significant deviation from the trend line
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
13
Figure 1.1 Trend in membership
Paid-up Share Capital
Table 2 shows that the paid up share capital from 1997 had been continuously
increasing. The increase in paid up share capital was due to the continuous increase in the
number of members. The new members brought in additional share capital. The total paid
up share capital in 1997 was P441, 912.23 and this increased to P548, 796.35 in 1998.
Table 2 shows that there is a significant deviation from the trend line from the
years 2002, 2004, and 2007. For 2002, there was a growth in paid up share capital though
it was slight only. This was followed by a surge in the following year and then a slight
increase in 2004. From then there has been a constant surge in paid up share capital.
The increase in paid- up share capital is directly related to the increase in
membership. The actual data shows a similar slow growth from 1997 to 2003, then a
surge in growth after that.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
14
Table 2 Paid-up share capital
REGRESSION
YEAR
PAID-UP
VALUE
DEVIATION
1997
441,912.23
(376,523.5947)
(818,435.82) *
1998
548,796.35
53,849.4653
(494,946.88)
1999
651,975.53
484,222.5253
(167,753.00)
2000
699,389.17
914,595.5853
215,206.42
2001
710,889.17
1,344,968.645
634,079.48
2002
970,071.52
1,775,341.705
805,270.19 *
2003
1,664,137
2,205,714.765
541,577.77
2004
1,745,560.07
2,636,087.825
890,527.76*
2005
2,903,736.33
3,066,460.885
162,724.56
2006
4,016,544.46
3,496,833.945
(519,710.51)*
2007
5,175,746.52
3,927,207.005
(1,248,539.51)
Std. deviation
672,955.27
* Significant deviation from trend line
The slope of the trend line, b= 430373.05, indicates an average increase in paid up
share capital about P430, 373.05 share capital a year.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
15
Figure 2.1 Trend in paid up share capital
Net Surplus
As shown in table 3. The cooperative has been generating positive net surplus
through the years though this has met drastic fluctuation.
Figure 3 shows the graph of net surplus against the year. Net surplus drastically
decreased in 1998 for the reason that the cooperatives’ operating capital was diverted to
investment on increasing the inventory of goods. In 1999-2001 this increased volume of
operations significantly contributing to the upward swing in net surplus. It reaches its
peak in 2001 then a drastic decrease in 2002 due to extraordinary loss due to robbery.
After this, the cooperative was able to somewhat increase the net surplus reaching its
highest peaks in 2007, barring a decrease in 2005.
The slope of the trend line, b= 20,498.94, indicates an average increase in net
surplus of about P20, 498.94 a year.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
16
Table 3 Net surplus
YEAR
SURPLUS
REGRESSION VALUE DEVIATION
1997
411,813.68
272,684.62
139,129.06
1998
90,922.39
293,183.56
(202,261.17)*
1999
274,568.31
313,682.50
(39,114.19)
2000
512,054.58
334,181.43
177,873.15
2001
646,682.04
354,680.37
292,001.67*
2002
173,340.52
375,179.31
(201,838.79)*
2003
230,200.04
395,678.24
(165,478.2)
2004
339,154.46
416,177.18
(77,022.72)
2005
202,320.87
436,676.12
(234,355.25)*
2006
572,911.82
457,175.06
115,736.76
2007
673,003.67
477,673.99
195,329.68*
Std.deviation
4,126,972.38
*Significant deviation from trend line
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
17
Figure 3.1: Trend in net surplus
Total Assets
Figure 4 shows the graphical display of total assets from 1997-2007. Table 4
shows that there are significant deviations from the trend line for 1997, 2002, 2003, 2007.
In 2002 to 2003, the growth in assets met a slow down due to mismanagement of funds,
according to the manager. However, 2004 showed a significant increase. This is the effect
after strictest implementations of policies to safeguard the operation of the cooperative
were instituted. Further increases are observed for the following years.
The slope of the trend line, b=1,327,289.7, indicates that for every year, the value
of total assets increase on the average by P1, 327,289.70.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
18
Table 4. Total assets
REGRESSION
YEAR
ASSETS
VALUE
DEVIATION
1997
1,867,113.39
384,763.43
1,482,349.96*
1998
1,880,507.7
1,712,053.1
168,454.16
1999
2,981,255.37
3,039,342.78
(58,087.41)
2000
4,119,819.69
4,366,632.46
(246,812.77)
2001
5,576,235.79
5,693,922.14
117,686.35
2002
5,755,001.55
7,021,211.81
(1,266,210.26)*
2003
5,826,239.47
8,348,501.49
(2,522,262.02)*
2004
10,459,048.42
9,675,791.17
783,257.25
2005
11,021,237.82
11,003,080.84
18,156.98
2006
12,923,299.95
12,330,370.52
592,929.43
2007
14,823,570.78
13,657,660.2
1,165,920.58*
Std. deviation
1,069,991.83
* Significant deviation from trend line
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
19
Figure 4.1: Trend in total assets
Strategies employed by the Bakun Central
Multipurpose Cooperative
As stated by the members and the staff of BCMPC. The following are some
strategies employed by the cooperative.
a. Members can avail loans and services of the cooperative
b. Patronage refund
c. There are some programs of the cooperative that leads the member to join like
organic farming to improve farm management.
d. Promotes low pricing commodities.
e. The cooperative creates funds in order to grant loans for production and
provident purpose.
f. Effective management of officers and staff.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
20
Factors Contributing to the Growth of Cooperative
The manager identified the following factors that contribute to the growth of
Bakun Central Multipurpose Cooperative.
1. Organizations growth measured through the continuous information campaign
initiated by officers on the cooperative privileges, benefits and advantages that could be
received by the members.
2. Expansion of the area of operation also attributed to the increase in membership
of the cooperative and the good performance of the cooperative,
3. Continuous training and education of the officers, members and employees,
4. Presence of effective, honest, and dedicated cooperative and community
leaders.
5. Dependence of self-help process in achieving their programs and projects
6. Efficient service for the promotion of social and economic advancement of the
cooperative members,
7. Good public relation.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
21
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
Summary
This study was conducted to assess the growth of Bakun Central Multi-purpose
Cooperative in Bakun, Benguet. It aimed to document the BCMPC operation in terms of
the number of its members, the trend in its share capital, total assets, and net surplus; to
determine factors contributory to the growth and performance of the cooperative and the
strategies employed by the cooperative for its development and improvement.
The increase in membership coupled with the decrease in culling of delinquent
membership contributed to a significant increase in membership starting 2004. The
decrease delinquency reflects the cooperative’s improved collection system or better
appreciation of members on their obligations to the cooperative. The continued growth in
membership is because of people’s appreciation of the benefits of the cooperative’s
service.
The pattern of the growth or increase in paid- up share capital is similar to that of
membership, hence, the growth in paid-up share capital for the cooperative is closely
related to the growth in membership.
There is a fluctuation in the growth in net surplus though it remains positive
through the years. The trend line shows general growth through the years.
In general, the trend line shows an annual growth in assets. Actual data, however,
shows a slowdown in asset growth for 2003 to 2004 due to mismanagement of funds.
Over all, the cooperative shows annual growth in membership, paid- up share
capital, assets, and net surplus.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
22
Conclusions
Based from the results and findings, the following conclusions were derived:
1. There is a continued growth in membership in BCMPC due to better
understanding of members on their responsibilities to the cooperative and because the
cooperative offers services being truly what the community people need.
2. The growth of the cooperative is primarily dependent on the growth in
membership, considering their appreciation of its services.
3. The cooperative has managed to maintain a positive net surplus through the years.
Recommendations
From the conclusions and lessons learned from the cooperative’s performance, the
following are recommended:
1. For cooperatives to understand the virtue of the “continuous cooperative
education” principle. Cooperatives would benefit from educating and reminding members
or perspective members on their responsibilities towards the cooperative and its
implication.
2. Improving cooperative’s delivery of services. A cooperative’s sustained
growth in membership hinges on the appropriateness of the services it offers to the
community’s appreciation of the benefits derived from this services. This insinuates that
cooperatives must make sure that the service they would offer are those truly needed by
and beneficial to the community. A cooperative education campaign would be
recommended to market the cooperative’s services which consequently will increase
membership.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
23
LITERATURE CITED
ANASTACIO, L. K. (2004). Profile of primary cooperatives in Itogon, Benguet. BS
Thesis. Benguet State University. La Trinidad, Benguet.
COOPERATIVE BUSINESS DEVELOPMENT. 1999. CHF International. Retrieved
April 3, 2009 from http://www.chfhq.org/node/27984.
COOPERATIVE DEVELOPMENT AUTHORITY ACT (Republic Act No. 6939).
2000. The cooperative development authority republic act no. 6939 of 1990
republic of the Philippines congress of the Philippines Retrieved April 3, 2009
from http://www.ilo.org/dyn/natlex/natlex_browse.details.
FULTON, M. E. and J. R. FULTON. 2008. Cooperative growth: Is it constrained.
Retrieved October 04, 2008 from http://www3.interscience.wiley.com/
journal/112476/abstract.
GUTKNECHT, D. 2008. Cooperative Capital and Member Equity Systems: The Heart of
Cooperatives. Retrieved April 3, 2009 from http://www.cooperative grocer. Coop/
articles/index.php? id=73.
ONAGAN, D. L. 1973. Cooperative principle and practices. Onagan and sons publisher,
Quezon City.Pp.91-99.
OUSTAPASSIDIS, K., A. VLACHVEI and K. KARANTININIS 2008. Growth of
Invest or Owned and Cooperative Firms in Greek Dairy Industry. Retrieved April
3, 2009 from http://www3.nterscience wiley.com/journal/119137 085/abstract?
CRET=1SRETRY.
SALDO, C. (2005). Profile of non-operating cooperatives in Bagulin, La Union. BS
Thesis. Benguet State University. La Trinidad, Benguet.
VICTOR, A. K. (2008). Members perceived from service. BS Thesis. Benguet State
University. La Trinidad, Benguet.
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
24
APPENDIX A
Regression Analysis
Table 1. Appendix Table, Summary Output of Membership
REGRESSION STATISTICS
Multiple R
0.8991455
R Square
0.8084627
Adjusted R Square
0.7871807
Standard Error
78.24525
Anova table
df
SS
MS
F
Significance F
Regression
1
232576
232576
37.98822 0.000166
Residual
9
55100.87
6122.319
Total
10
287676.9
Coefficients Standard Error
t Stat
P-value
Intercept
31.2
50.59884
0.616615
0.552765
X Variable
45.981818
7.460392
6.163459
0.000166
Growth of Cooperative: The Case of B akun Central
Multi-purpose Cooperative / Gemma D. Ba langoy. 2009
25
Table 2. Appendix Table, Summary Output of Paid up share capital
REGRESSION STATISTICS
Multiple R
0.896401
R Square
0.803534
Adjusted R^2
0.781705
Standard Error
743980
Observations
11
Anova Table
anova
df
SS
MS
F
Significance F
Regression
1
2.03743E+13 2.03743E+13 36.8095288 0.000186561
Residual
9
4.98156E+12 5.53506E+11
Total
10
2.53559E+13
Standard
Upper
Coeff.
Error
t Stat
P-value
Lower 95%
95%
Intercept
-806896.66 481109.42 -.677158
0.12782 -1895241.768
281448.46
X
Variable
1
430373.05 70935.714
6.06709
0.00019
269905.32 590840.79
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
26
Appendix Table 3, Summary output of net surplus
Regression Statistics
Multiple R
0.969008876
R Square
0.938978202
Adjusted R^2
0.932198002
Standard Error
1182920.475
Observations
11
Anova Table
df
SS
MS
F
Significance F
Regression
1
1.94E+14
1.94E+14 138.48828
9.09E-07
Residual
9
1.26E+13
1.40E+12
Total
10
2.06E+14
Coeffi-
cients
Standard Error
t Stat
P-value
Lower 95%
Intercept
-942526.25
764958.94
-1.23213 0.24912
-2672983.58
X Variable 1
1327289.7
112787.04
11.7681 9.09E-07
1072147.66
Appendix table 4, Summary Output of Total Assets
Regression Statistics
Multiple R
0.337644655
R Square
0.114003913
X Variable 1
1327289.7
Adjusted R^2
0.015559904
Standard Error
199784.807
Observations
11
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
27
Anova table
df
SS
MS
F
Significance F
Regression
1 46222707634 46222707634 1.15805841 0.309868489
Residual
9 3.59226E+11 39913969128
Total
10 4.05448E+11
Standard
Lower
Coefficients
Error
t Stat
P-value
95%
Upper 95%
Intercept
252185.68 129194.80 1.95198 0.08270 -40073.26 544444.623
X Variable
1
20498.937 19048.73 1.07613 0.30987 -22592.29 63590.1672
Growth of Cooperative: The Case of Bakun Central
Multi-purpose Cooperative / Gemma D. Balangoy. 2009
Document Outline
- Growth of Cooperative: The Case ofBakun Central Multi-purpose Cooperative
- BIBLIOGRAPHY
- ABSTRACT
- TABLE OF CONTENTS
- INTRODUCTION
- Background of the Study
- Statement of the Problem
- Objectives of the Study
- Scope and Delimitation
- Importance of the Study
- REVIEW OF LITERATURE
- Definition of Growth
- Cooperative Growth
- Cooperative as a tool of Development
- Objectives of the Cooperative
- Membership
- METHODOLOGY
- RESULTS AND DISCUSSION
- Membership
- Paid-up Share Capital
- Net Surplus
- Total Assets
- Strategies employed by the Bakun CentralMultipurpose Cooperative
- Factors Contributing to the Growth of Cooperative
- SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
- Summary
- Conclusions
- Recommendations
- LITERATURE CITED
- APPENDIX