Why did an agricultural cooperative turn down a business proposal from a cooperative society [in Japan] ?
1997
Shibuya, C. (Hirosaki Univ., Aomori (Japan). Faculty of Agriculture)
What constitutes an "equal relationship between as agricultural cooperative and a cooperative society"? the aim of this paper is to clearly define this concept. In 1992, U co-op, one of the largest cooperative societies in the Tokyo area,proposed the direct dealing of farm products to JA S, an agricultural cooperative in Aomori prefecture. JA S had been strengthening its business relationship with U Co-po. The agricultural cooperative invited the members of U Co-op to Aomori and promoted an interchange of personal. Its members willingly participated in various events held in Tokyo by U Co-op. Because of such a good relationship between the two associations, the members of JA S seriously discussed the proposal from U Co-op. However, they reached the conclusion that JA S would not enter into the new contract, but would maintain its current relationship with U Co-op. Why did they draw such a conclusion? What was wrong with the contract? The proposal from U Co-op was inconvenient to JA S in respect to penalties, rebates, financial support and other matters. Because of the specific nature of their products, agricultural cooperatives have been making flexible deals with cooperative societies. Regrettably, the business proposal from U Co-op lacked such consideration. Various cooperative associations entered into partnerships not only for business but also to encourage a good relationship. U Co-op, however, disregarded this objective in its contract. It was also a problem that JA S had to take too high a risk. Some agricultural cooperatives may think that they cannot reject a business proposal from a cooperative society, even when its content is disadvantageous to them. Yet JA S had the capability to cope with such an unsatisfactory proposal and to turn it down on its own judgment. The association was able to do this because it had already established a diversified business trade network through its members' efforts
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