When starting a small business following the cooperative model, try not to provide competition to other local businesses in the area. Either find a location where you will not be encroaching on similar businesses’ territory or offer something different. Shops that sell locally produced goods and that promote the movement will straight away be different and a good outlet for a number of your suppliers.
I will give an example of a clothes shop. Let’s say you have contacts with a group of people who like knitting and will happily make lots of scarves, gloves, jumpers, etc. You also know of aspiring designers who produce many other types of clothes. Your shop is going to be the communal outlet for all of these locally produced goods. This is so that people always know where to go instead of asking the individual manufacturers! The shop has a sign in the window to enforce the philosophy with the hope that more people will learn about it and become involved with supporting local workers more and the multinationals less.
When the shop has enough goods to open with, you should use an ethical business model that obviously intends to cover the shop’s costs (rent, energy, assistants’ wages, etc.) and also pays a decent amount to the people who create the goods. There must be no room for exploitation or corruption. Everything should be transparent to everyone involved. For example, the manufacturers know how much their t-shirt will be sold for and how much they will be paid once a sale has taken place.
With it being local and you knowing all the manufacturers personally, it can work this way. There is no need to buy the products from them first as this requires a lot of money upfront. Sell the t-shirt for £10 and then pay the manufacturer £7. It’s up to you to decide on the percentage to pay, depending on costs of materials and how much they will accept, but pay them enough or they won’t work with you. This system of production should be standard for all businesses of this nature so that everyone is equal and no-one is being exploited. As a movement, you can agree your own conditions and form legal documents as you are your own bosses.
This is how Troc works, which is a large business based in France. Its system is explained in the article on second hand goods businesses.