ABSTRACT
This chapter classifies seven competitive advantages : i) Bargaining power, ii) The sharing of costs, iii) Higher productivity, iv) Lower prices of outputs, v) The transformation of non-standard jobs into standard jobs, vi) The generation of formal ‘part-time’ jobs, and vii) The promotion of social capital. In order to contextualize this competitiveness within a broader market setting, it is also necessary to analyze the strengths of cooperatives’ competitors, namely, conventional companies. Conventional companies have two strengths : the capacity to mobilize large capital volumes and the possession of rapid decision-making mechanisms. Against this backdrop, it should be noted that the main battleground between cooperatives and conventional companies lies in labor-intensive sectors, since cooperatives have difficulties in entering capital-intensive sectors. Importantly, in labor-intensive sectors, cooperatives are highly likely to have an upper hand over conventional companies . In such sectors, conventional companies lose their two strengths against cooperatives, whereas cooperatives maintain their seven strengths against conventional companies. Empirical analyses of enterprises in several countries, such as the United Kingdom, France, Canada, Portugal, and Uruguay, confirm that the survival rates of cooperatives are higher than those of conventional companies.
