COOPFED;A SUCCESS STORY OF CONSUMER COOPERATIVES IN SRI LANKA D.S.K. Pathirana General Manager / Chief Executive
Sri Lanka Consumer Cooperative Societies Federation .
Amongst the successful stories of consumer cooperatives in the Asia-Pacific region, the story of
Sri Lanka Consumer Cooperative Societies Federation popularly known as ‘COOPFED’ is quite
notable. The bond which it has developed with the consumers in a cooperative spirit shows the
strength of the cooperative concept.
Sri Lanka Consumer Cooperative Societies Federation is one of main essential goods and services
supplier in Sri Lanka since the year 1989. Its main purpose is to import, procure and supply the
consumer requirements / food items of the member multi- purpose cooperative societies
through out Sri Lanka so that the consumers can purchase these items at fair and reasonable
prices.
In the recent years, COOPFED has adapted quite well to the demands of the competitive
economy. In order to cope up with the pressures of market economy, COOPFED is well aware to
protect the interests of the consumers. It now directly deals with the consumers for whom this
is a big benefit. COOPFED has opened its 13th coop city super market in the island State. The
Government as well as the top management of COOPFED have identified the Super Market
project as most important for the consumers and they hope to open eight new super markets
in this year.
COOPFED is all geared to improve the cooperative knowledge of cooperators. In this regard it
has established the training centre named Consumer Cooperative Management Training
Institute. This centre is improving the cooperative knowledge of the cooperators and enhancing
their professional skills. COOPFED is a successful business project for all the cooperators
as it provides social benefits to all. The ICA members and the other cooperators in the world
should come and visit the cooperative super market project and see the successful working
of the COOPFED training centre.
The cooperative movement is one
of main balancing factors of the
economy in Sri Lanka. The history
of the cooperative movement in Sri
Lanka can be traced back to 1904
when the Agriculture Credit Society
in Manikinna was started. The first
cooperative society was established
as Co-operative Credit Society
under the Co-operative Society Act
No. 07 of 1911. Since 1911 the cooperative sector in Sri Lanka has played a major role at various
stages, and there have been changes in its organizational structure with relevant legislations.
Before 1983, cooperative societies were registered under the Cooperative Societies Act No. 05
1972 and this was again amended in 1983 and later in 1992 as the Cooperative Societies
(Amended) Act No. 11 of 1992.The management structure of the cooperative societies has been
established under the Cooperative Employees Act No. 12 of 1972, and this was amended as
Cooperative Employees (Amended) Act No. 51 of 1992. The cooperative societies have been
organized as multipurpose societies.
As Sri Lanka is a developing country of the third world nation the activities of the cooperative
sector in Sri Lanka have been closely linked up with the daily life of the majority of the
population over half a century. The cooperative organizations are actively engaged in a variety
of activities related to economic, social and political significance. They are involved in
distribution of consumer goods, supply of essential consumer services, supply of agricultural
inputs, promotion and marketing activities in the fields of agriculture, fisheries & industry, as
well as mobilization and allocation of savings in the rural areas with the mutual assistance of
the Cooperative Rural Bank.
Under the present set up COOPFED is engaged in development and promotion of the consumer
cooperatives through improving consumer cooperative performance in Sri Lanka so as to help
the members at the grass root level. The ultimate objective is to increase members income and
ensure their active participation in cooperative business ventures
The Sri Lanka Consumer Cooperative Societies Federation Ltd was registered on 15 September
1989 as the apex Federation of the Consumer Cooperative Movement in Sri Lanka and it
commenced its business operations on 7 March 1990. The need for an organization at the
centre to assist the consumer cooperative societies was felt and the Cooperative Federation
was established with the contribution of the state. Its main purpose has been to look after the
consumer needs of the member multi- purpose cooperative Societies throughout Sri Lanka. The
COOPFED has gone further by setting up and opening self-service shops in the urban and
rural areas as well as opening up welfare shops in the government offices and schools.
All multi-purpose Cooperative Societies operating through out Sri Lanka shall be members of
the Cooperative Federation. The value of one share is SLR 25,000.00, and all the members are
entitled to take one share of the share capital. At present 270 multi- purpose cooperative
Societies have taken membership as active members of Cooperative Federation. Sri Lanka
Consumer Cooperative Societies Federation has several business tasks like wholesale business,
retail sale, air ticketing section, production and packaging unit, etc.
The Cooperative Federation is an active member of the International Cooperative Alliance since
1995 and it is having strong international cooperative relations with the various cooperative
organizations around the world like ICA,ICA-
AP,CICTAB,ANGKASA,JCCU,ESCOLA,NISPED[Israel],etc.
Fair Price Super Market
Each & every kind of consumer items
available including garden fresh
vegetables, fruits, dal, rice, sugar, dry
fish items, fish & chicken, grocery items,
etc., are available at various shops like
Colombo Coop City Super Market,
Polgolla Fair Price Super Market, Paranthan Coop City Super Market, Panadura Coop City Super
Market, Piliyandala Coop City Super Market, etc.
According to Establishment Code of Sri
Lanka Consumer Cooperative Societies
Federation, super markets should have
both individual records as well as final
accounts. Due to the difficulties in the
traditional accounting system, a
computerized accounting system has
been introduced which has been very
beneficial.
COOPFED super markets are running as
a Super Market Network and this
network is controlled by the
commercial department at the head
office. Due to this it can have regular
information related to live stock
updates, daily turnover, purchasing and
money balance, etc. This network is
directly connected with the head
office’s accounting department. Because of that, Individual final reports and overall final reports
are made by the accounting department on monthly as well as annual basis.
Many of the super markets are
running on customer self service
method. They can select goods based
on their needs. The employees are
trained in issues related to customer
care and safety of goods. The visual
camera system is a big support
mechanism for the smooth functioning
of the super markets. Visual updates on daily basis are recorded in main saver computer in the
super market and again these updates are recorded by main office also. The daily customer
service, customer needs, customer behavior, goods security and employee behavior are well
monitored.
There has been no credit sale by
the super markets as the emphasis
has been on cash sale only. Before
five years, primary cooperative sale
shops had credit sale. As a result of
that, the number of creditors was
quite high. Therefore Sri Lanka
Consumer Cooperative Societies
Federation took a decision to stop
credit sales. According to this
decision, COOPFED started using electronic cards such as various credit cards, debit cards, visa
cards and other money transferring electronic bank cards.
The cooperative super market
system is mainly controlled by the
General Manager and he is the
chief executive person as well as
top responsible person. All the
issues related to functioning of the
super markets are discussed with
the executive board and board of
directors by the chief executive.
Daily updates of super markets are
received and there is quick decision
making by the top management.
The Supervisors are appointed for
each super market. The appointed
persons report all issues, customer
requirements and market variances
to the commercial department. The
Sri Lanka consumer cooperative
societies federation has a super
market main store in head office and it has five regional super market stores. The super
markets requirements, like consumer goods items are distributed from stores using federation’s
transport system. For special days and events, the Federation is involved in marketing
promotions. These promotions are mainly handled by the commercial department and there is
annual promotion named as “GAMIN GAMATA DORIN DORATA”. The COOPFED staff with
mobile sale vehicles go around the island for mobile sale. Not only that, COOPFED organizes
short term business promotions for special goods and new consumer items but the
advertisement marketing system is avoided in this case. The country has strong belief in
cooperative consumer system and due to this there is direct government support which is not
in the case of the private sector.
In future, the Federation expects to develop the super market system for successful business
diversification. Without diversification, the cooperatives can not face market competition and
can not protect our consumers permanently. In this regards, Sri Lanka consumer cooperative
societies federation is always trying
to look after the customer needs.
Sri Lanka Consumer Cooperative
Societies Federation has identified
many areas for developing the super
markets. One crucial area is related to
training and development of staff.
The training institute has been
established for conducting training programmes. These are short-term training programmes,
field visits, full time courses and international training programmes.
The Consumer Cooperative Management Training
Institute
The main objective of Consumer Cooperative
Management Training Institute is to utilize the
human resources in a very constructive and
productive manner so that their knowledge, skills
and aptitude are rewarded on merit basis.
The Federation has started an Education Unit
named Consumer Cooperative Management
Training Institute. All cooperators can now develop
their consumer cooperative knowledge, computer
knowledge, English knowledge, as well as Human
Resource Management Skills. The Institute runs
various courses like Certificate Course of Computer, Certificate Course in Professional English,
Certificate Course of Super Market Management, Diploma Course of Human Resource
Management, Certificate Course of Consumer Cooperative Management, etc. The 1st one day
workshop on “Achieving Business Objectives by Improving Customer Relationship” was