Cooperative research

1. THE ROLE OF
CO-OPERATIVE SOCIETY IN POVERTY
ALLIVIATION IN NIGERIA
CERTIFICATION
This is to certify that this project work was carried out by
…………………………………………………… in the Department of
Business Administration, School of Business Studies. Akwa Ibom State
Polytechnic. Ikot Asurua, Ikot Ekpene for the award of higher national
diploma in business administration.
………………………….. ………………………….
Project Supervisor Centre Coordinator
…………………………... ………………………….

2. Date Date
DEDICATION
This research work is dedicated to the Almighty God for seeing me
through the whole period of the program and granting me academic
excellence despite the difficulty encountered.
ACKNOWLEDGEMENT
To God be the glory for its not by my power nor my might but by His
grace that is superfluous and more than sufficient. I thank Him for
making this programme a reality.
I am also grateful to my supervisor ………………………for his
painstaking and thoroughness in supervising this project.
I acknowledged the immense support I received from my family
especially my children, their encouragement during the period of the
programme.
The cooperation and the encouragement of my supporting staff who
always stand in for me anytime I am away.
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3. This acknowledgement will be incomplete without noting the contribution
of the following people to the success of the programme, the school
registrar, the assistance registrar and other friends who had contributed
in one-way or the other to the successful completion of the programme.
A special word of thanks go to staff of C.A.C.T. Publishers in typing the
various draft of the manuscript..
I wish to conclude this acknowledgement by expressing my sincere
appreciation to all my colleagues for their friendly disposition towards me
during the period of the programme. MAY GOD BLESS YOU ALL.
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4. ABSTRACT
A cooperative is an enterprise in which individuals voluntarily organize to
provide themselves and others with goods and services via democratic
control and for mutually shared benefit. Members generally contribute to,
and control via a democratic process, the cooperative's capital.
Moreover, cooperatives often provide education and training to their
members. Over the years the cooperative form has extended to credit
unions, wholesale and/or retail consumer groups, residential
organizations, producer enterprises, and marketing associations
Certain broadly defined economic advantages accompany each specific
cooperative type. For example, members of a consumer cooperative are
entitled to receive a patronage dividend. Distributed from net earnings,
the amount of current dividends received per member is determined by
the amount members spent on the cooperative's products since the last
period's payout. Moreover, members working within the cooperative can
qualify for substantial in-store merchandize discounts. For members of a
residential cooperative, property-owning members function as
stockholders and receive benefits from the cooperative nature of
incurring maintenance and interest costs.
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5. CHAPTER ONE
INTRODUCTION
1.0 THE BACKGROUND OF THE STUDY
Much of the modern-day research and historical literature on cooperatives centers
on the category of producer cooperatives, even though consumer cooperatives have
been in existence since the 1840s. For the most part, this one-sided treatment is
historically related to the rise of the capitalist factory system. To many workers
experiencing the harsh routines of the factory systems' exacting discipline for the first
time, producer cooperatives held out the promise of a more humanistic alternative
form of economic organization.
The "modern cooperative era" began in 1844, when the Rochdale Equitable
Pioneers Society was established in Rochdale, England. Its members documented
the principles by which they would operate their food cooperative, implementing the
central tenets around which cooperatives are structured today. Throughout the late
19th and early 20th centuries, cooperatives sprung up sporadically in America,
particularly in times of economic hardship. In 1922, Congress passes the Capper-
Volstead Act, allowing farmers to collectively market products without being held in
violation of the nation's anti-trust laws. In the Depression years, Congress
established various agencies to provide loans and assistance to cooperatives,
including the Farm Credit Administration (1929), the National Credit Union
Administration (1934), and the Rural Electrification Administration (1936). The
National Cooperative Bank was established in 1978 under the National Consumer
Cooperative Bank Act.
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6. From the report of the workshop held on 10th – 11th November 2008 during the 8
the ICA Africa regional assembly at the international conference centre, Abuja. Mr
Tom Tar - The Executive Secretary of Cooperative Federation of Nigeria, In his
introduction of the movement in Nigeria, said the Cooperative Federation of Nigeria
(CFN) was formed in 1945 and got registered in 1967.
He traced the background of cooperatives in Nigeria to the traditional savings and
loans system. He added that following agitation by the Agege Cocoa planters Union
in 1907, the study for establishment of formal cooperation was commissioned in
1934. This was followed by the enactment of cooperative legislation in 1935. The
early move was in agriculture and latter shifted to marketing following the shift in the
Nigerian economy from agriculture to crude oil. He gave the scope of cooperative
activities in Nigeria as covering: On population, he said there are about 5million
family members covering 20 million house holds. Total number of registered
cooperative societies is about 50,000.
He enumerated the following social and economic impacts of cooperatives in
Nigeria as:-
- Employment creation
- Credit to empower members to own their own business
- Contribution to GDP though statistics not available but impact is known
- Advocacy and lobbying for better legislation
He gave the future development of cooperatives as:
- Committed integration of women
- Strengthening cooperatives from within and reduced dependence on
government because “assistance seekers are always vulnerable”
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7. - Better services to members to enable them increase their income
- Improved business entrepreneurial skills
- Stronger cooperative identity by members, committee and managers.
1.1 STATEMENT OF THE RESEARCH PROBLEM
In considering the statement of the research problem, these question
readily come to mind:……Why cooperative model:
- This involved insurance to the poor people who are neglected by
conventional insurance companies
- Cooperative model satisfies needs of the poor
- Product is developed with market needs in mind covers all needs of
members- lands, agric, commercial, cooperatives.
- Community minded
- Member involvement
- Cooperatives are trust worthy organizations in environment where
corruption is high
- Member education claims first promptly because the best customer is
educated customer.
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8. 1.2 OBJECTIVES OF THE STUDY
The main objective of this research work is to determine the cons and
pros of cooperative movement in Nigeria, according to Mr. Oki of
Lagos State Cooperative Federation (LASCOFED).Cooperative
movement is developing a strong cooperatives for social and economic
progress the members.
He unveil that cooperatives has moved from more contribution and
lending of money to members to creating returns through engagement in
business activities.
He stated that since COOPERATIVES is seen AS a SOCIAL
ORGANIZATION, the primary objective is that :…
- Cooperatives put people at the centre of their business and not capital.
- in cooperative movement, the welfare of members is emphasized
- Cooperatives engage in business activities that touch members eg
schools building, credit.
- cooperative Create jobs and empowerment for members
1.3 SIGNIFICANCE OF THE STUDY
This study is significant because it will produce data on cooperative
movement in Nigeria that will be useful to:
1. federal ministry of labour and productivity
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9. 2. national union of local government employees
3. state civil service commission
4. federal civil service commission .
5. managers and top executives in organized private sector
6. united nation commission on employment
7. federal ministry of finance
8. Central bank of Nigeria
9. students carrying out a research work in this same issue.
1.4 HYPOTHESES
It is a conjectural statement of the relationships between two or
more variables. It is testable, tentative problem explanation of the
relationship between two or more variables that create a state of
affairs or phenomenon.
E.C. Osuola (1986 page 48) said hypothesis should always be in
declarative sentence form, and they should relate to them
generally or specially variable to variables.
HYPOTHESIS THUS:
1. Explain observed events in a systematic manner
2. Predict the outcome of events and relationships
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10. 3. Systematically summarized existing knowledge.
In essence, there exist NULL HYPOTHESIS set up only to nullify
the research hypothesis and the ALTERNATIVE HYPOTHESIS for
the purpose of the study. For the efficiency of the study, the
hypothesis is as follows:
Null Hypothesis (Ho)
1. Cooperative does not play leading role in poverty reduction
2.`Cooperative does not grant Credit to empower members to own
their own business
Alternative Hypothesis
1. Cooperative plays a leading role in poverty reduction
2. Cooperative do grant credit to empower members to own their
own business
1.5 LIMITATIONS OF THE STUDY
A research work of this nature cannot come to an end without
limitation. The researcher encountered numerous problems which
affected the smooth running of the work. These problems includes,
difficulty in procuring materials for the project, time factor and
financial constraints.
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11. Material Procurement
There was a lot constraints as to getting information and materials
for the job. The researcher made series of consultations and visit
to most renowned institutions to acquire the needed information.
Most materials used were very difficult to come by, as there is no
library within the town.
Time Constraints
Combining academic work with job is no doubt a thought provoking
issue, as it has to do with time. Actually, a lot of time was wasted
as the researcher visited the organizations and individuals together
with government agencies to obtain valuable information for the
project.
Financial Constraints
The researcher would have obtained more information than what is
obtainable here but due to lack of money to visit some of the firms
and government agencies located a bit farther from the researcher
place of resident.
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12. 1.6 THE STRUCTURE OF THE WORK
This research work is to be organized in five chapters as follows:
1 Introduction
2 Review of related literature
3 Research method
4 Data presentation and analysis
5 Summary, conclusion and recommendation
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13. CHAPTER TWO
LITERATURE REVIEW
1.0 THE NATURE OF COOPERATIVES
Cooperatives tend to attract a greater proportion of unskilled blue-collar
workers and fewer white-collar and managerial workers than business
enterprise. In large part, this may be attributable to the notion among many
cooperatives that, in order for a truly functioning democratic structure to
operate, traditional, specialized management positions should be de-
emphasized because they place non-managers at a disadvantage regarding
the development of skills and access to information necessary for decision-
making capabilities. Rather, cooperatives, by comparative standards,
emphasize the development of decision-making capacity for all its members.
Indeed, one of the primary causes of a cooperatives' failures is tendency of
workers to leave decisions to a small number of directors, which inevitable
results in a more authoritarian structure and generates internal animosity.
On a more basic level, this pattern of drawing lower-skilled workers may be
related to the common practice of distributing residual income (a rough
equivalent of profit sharing) to cooperative employees, a procedure that is
often formalized in the cooperative's bylaws. This amount might be a fixed
percentage or may vary, and is distributed to workers as a "bonus" payment.
Income distribution within producer cooperatives is structured along
egalitarian principles. Either peer pressure or cooperative bylaws see to it
that, depending on their skill-level, members receive equal pay for equal work
while differences in the number of hours worked are minimized. Most
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14. cooperatives institute income differential constraints. In terms of voting weight,
and unlike a business enterprise, the principle of one-person one-vote applies
independent of member's percentage share of ownership.
Most producer cooperatives face the thorny problem of hiring nonmember
workers. In most cases nonmember workers receive bonus payments, but
since they do not own shares in the firm they are excluded from its
participatory process, including distribution of profit shares. Unless accounted
for in the bylaws, there are built-in incentives for cooperatives to increase the
ratio of hired workers to share-owning members. Assuming that nonmember
labor of equivalent quality can be hired as either an additional worker or to
replace a departing member, then profit share paid out to all remaining
members increases even when the new worker receives a bonus payment.
2.1 ORIGIN OF COOPERATIVE MOVEMENT
The cooperative movement has since had considerable growth throughout
Great Britain and the Commonwealth, where local cooperatives have been
federated into national wholesale and retail distributive enterprises and where
a large proportion of the population has membership. Various examples of
cooperative organization are also found in the Scandinavian countries, Israel,
the People's Republic of China, Russia, and France. In the United States the
cooperative movement began in the 19th cent., first among workers and then
among farmers.
Although co-operation as a form of individual and societal behavior is intrinsic
to human organization, the history of modern co-operative forms of organizing
dates back to the Agricultural and Industrial Revolutions of the 18th and 19th
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15. centuries. The status of which was the 'first co-operative' is under some
dispute, but various milestones in the history may be identified.
In 1761, the Fenwick Weavers' Society was formed in Fenwick, East Ayrshire,
Scotland to sell discounted oatmeal to local workers. Its services expanded to
include assistance with savings and loans, emigration and education. In 1810,
Welsh social reformer Robert Owen, from Newtown in mid Wales, and his
partners purchased New Lanark mill from Owen's father-in-law and proceeded
to introduce better labor standards including discounted retail shops where
profits were passed on to his employees. Owen left New Lanark to pursue
other forms of co-operative organization and develop co-op ideas through
writing and lecture. Co-operative communities were set up in Glasgow,
Indiana and Hampshire, although ultimately unsuccessful. In 1828, William
King set up a newspaper, The Cooperator, to promote Owen's thinking,
having already set up a co-operative store in Brighton.
In nutshell, cooperative movement began in Europe in the 19th century,
primarily in Britain and France, although The Shore Porters Society claims to
be one of the world's first cooperatives, being established in Aberdeen in 1498
(although it has since demutualized to become a private partnership). The
industrial revolution and the increasing mechanization of the economy
transformed society and threatened the livelihoods of many workers. The
concurrent labor and social movements and the issues they attempted to
address describe the climate at the time.
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16. 2.2 DEFINING COOPERATIVE MOVEMENT
A cooperative (also co-operative or coöperative; often referred to as a co-
op or coop) is defined by the International Co-operative Alliance's Statement
on the Co-operative Identity as an autonomous association of persons united
voluntarily to meet their common economic, social, and cultural needs and
aspirations through a jointly-owned and democratically-controlled enterprise. It
is a business organization owned and operated by a group of individuals for
their mutual benefit. A cooperative may also be defined as a business owned
and controlled equally by the people who use its services or who work at it.
Cooperative enterprises are the focus of study in the field of cooperative
economics.
2.3 THE SPREAD OF COOPERATIVE IDEAS
The cooperative spirit has, indeed, caught on in various forms around the
world, and has even risen to relative prominence amidst some dramatic
historical moments. During the Spanish Civil War in the mid1930s, when
much of the business community took flight from Francisco Franco's fascist
forces, Spanish anarcho-syndicalists took control of the agricultural and
industrial organizations in many Spanish cities, declaring these activities
collectivized. While the movement was later crushed by force, it represents
perhaps the most widespread societal implementation of cooperative values
and principles.
Interestingly enough, by the late 20th century many, but not all, of the ideas
and workplace advantages inherent in cooperative firms began to take root in
traditional, non-cooperative workplaces. Indeed, these same ideas and
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17. organizational structures formed the substance guiding a majority consensus
emergent within the industrial relations field. Though referred to as "labor-
management cooperation," that term carried within it the essentials of
cooperative thought. Under this rubric an attempt was made at transplanting
the cooperatives' nonadversarial work environment into the CF workplace.
Management found the cooperatives' lack of "rigid" job assignments and pay
according to group or individual effort, rather than seniority, appealing.
General Motors Corp. and the United Auto Workers have been operating
under a form of labor-management cooperation since 1982.
At the close of the 20th century, the general insertion of labor-management
cooperation clauses into contractual agreements of organized labor appeared
imminent. According to the prevailing wisdom, the institutionalization of labor-
management cooperation schemes represented a central industrial strategy
by which the competitiveness and productivity of U.S. firms could be restored.
A potential legal roadblock existed, however, in Section 8(a)(2) of the National
Labor Relations Act, which prohibited "employer dominated" labor
organizations. A number of union activists have argued that labor-
management cooperation schemes were little more than a new form of old
business unionism.
2.4 CO-OPERATIVES TODAY
Co-operative communities are now widespread, with one of the largest and
most successful examples being the Mondragón Cooperative Corporation in
the Basque country of Spain. Co-operatives were also successful in
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18. Yugoslavia under Tito where Workers' Councils gained a significant role in
management.
In many European countries, cooperative institutions have a predominant
market share in the retail banking and insurance businesses.
In the UK, co-operatives formed the Co-operative Party in the early 20th
century to represent members of co-ops in Parliament. The Co-operative
Party now has a permanent electoral pact with the Labour Party, and some
Labour MPs are Co-operative Party members. UK co-operatives retain a
significant market share in food retail, insurance, banking, funeral services,
and the travel industry in many parts of the country.
In Nigeria today, cooperative movement can be traced to the traditional
savings and loans system. In 1907, the study for establishment of formal
cooperation was commissioned in 1934. This was followed by the enactment
of cooperative legislation in 1935. The association of people is called
cooperative federation of Nigeria.
2.4 TYPES OF COOPORATIVE SOCIETY
2.4.1 Retailers' cooperative:
A retailers' cooperative (known as a secondary or marketing co-operative in
some countries) is an organization which employs economies of scale on
behalf of its members to get discounts from manufacturers and to pool
marketing. It is common for locally-owned hardware stores and pharmacies.
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19. 2.4.2 Worker cooperative
A worker cooperative or producer cooperative is a cooperative, that is owned
and democratically controlled by its "worker-owners". There are no outside
owners in a "pure" workers' cooperative, only the workers own shares of the
business, though hybrid forms in which consumers, community members or
capitalist investors also own some shares are not uncommon. In practice,
control by worker-owners may be exercised through individual, collective or
majority ownership by the workforce, or the retention of individual, collective
or majority voting rights (exercised on a one-member one-vote basis). A
worker cooperative, therefore, has the characteristic that the majority of its
workforce own shares, and the majority of shares are owned by the
workforce. Membership is not always compulsory for employees, but
generally only employees can become members either directly (as
shareholders) or indirectly through membership of a trust that owns the
company.
2.4.3 Social cooperative:
A particularly successful form of multi-stakeholder cooperative is the Italian
"social cooperative", of which some 7,000 exist. "Type A" social cooperatives
bring together providers and beneficiaries of a social service as members.
"Type B" social cooperatives bring together permanent workers and
previously unemployed people who wish to integrate into the labour market.
Social cooperatives are legally defined as follows:
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20. • no more than 80% of profits may be distributed, interest is limited to the
bond rate and dissolution is altruistic (assets may not be distributed)
• the cooperative has legal personality and limited liability
• the objective is the general benefit of the community and the social
integration of citizens
• those of type B integrate disadvantaged people into the labour market.
The categories of disadvantage they target may include physical and
mental disability, drug and alcohol addiction, developmental disorders
and problems with the law. They do not include other factors of
disadvantage such as race, sexual orientation or abuse.
• type A cooperatives provide health, social or educational services
• various categories of stakeholder may become members, including
paid employees, beneficiaries, volunteers (up to 50% of members),
financial investors and public institutions. In type B co-operatives at
least 30% of the members must be from the disadvantaged target
groups
• voting is one person one vote
2.4.4 Consumers' cooperative
A consumers' cooperative is a business owned by its customers. Employees
can also generally become members. Members vote on major decisions, and
elect the board of directors from amongst their own number. A well known
example in the United States is the REI (Recreational Equipment
Incorporated) co-op, and in Canada: Mountain Equipment Co-op.
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21. 2.4.5 Business and employment co-operative
Business and employment co-operatives (BECs) are a subset of worker
co-operatives that represent a new approach to providing support to the
creation of new businesses. Like other business creation support schemes,
BECs enable budding entrepreneurs to experiment with their business idea
while benefiting from a secure income. The innovation BECs introduce is that
once the business is established the entrepreneur is not forced to leave and
set up independently, but can stay and become a full member of the co-
operative. The micro-enterprises then combine to form one multi-activity
enterprise whose members provide a mutually supportive environment for
each other.
2.4.6. Housing cooperative
A housing cooperative is a legal mechanism for ownership of housing where
residents either own shares (share capital co-op) reflecting their equity in the
cooperative's real estate, or have membership and occupancy rights in a not-
for-profit cooperative (non-share capital co-op), and they underwrite their
housing through paying subscriptions or rent.
Housing cooperatives come in two basic equity structures:
• In Market-rate housing cooperatives, members may sell their shares
in the cooperative whenever they like for whatever price the market will
bear, much like any other residential property. Market-rate co-ops are
very common in New York City.
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22. • Limited equity housing cooperatives, which are often used by
affordable housing developers, allow members to own some equity in
their home, but limit the sale price of their membership share to that
which they paid.
2.4.7 Building cooperative
Members of a building cooperative pool resources to build housing, normally
using a high proportion of their own labour. When the building is finished,
each member is the sole owner of a homestead, and the cooperative may be
dissolved. This collective effort was at the origin of many of Britain's building
societies, which however developed into "permanent" mutual savings and
loan organisations.
2.4.8 Agricultural cooperative
Agricultural cooperatives are widespread in rural areas. In the Nigeria, there
are both marketing and supply cooperatives which promote and may actually
distribute specific commodities. There are also agricultural supply
cooperatives, which provide inputs into the agricultural process.
2.5 THE PROS AND CONS OF COOPERATIVE MOVEMENT
THE PROS: Advocates of producer cooperatives claim numerous
comparative advantages over what is generally referred to as a classical firm
(CF). The proposed advantages extend to a host of theoretical issues. Many
overlap the separate disciplines of labor economics, industrial management
and organization theory, investment and finance, and property rights theory.
Academicians have devoted significant amounts of research and analysis to
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23. such issues as (1) the absence of "shirking" by workers in producer
cooperatives; (2) superior productivity rates that result from the extension of
democratic principles into the cooperative workplace; (3) the lack of
unnecessary supervision due to the "horizontal monitoring" performed by
cooperative members; and (4) the pursuit of cooperative employment and
output strategies that are less sensitive to business cycle fluctuations.
THE CONS:
Compared to CFs, producer cooperatives suffer from two interrelated
investment disadvantages. Both are readily acknowledged by most
cooperative proponents. The first concerns the problem of intra-firm finance or
underinvestment. This tendency arises when the disparity between a worker
member's expected profit share of income and what they could earn by
investing outside the firm (say, at a bank rate of interest) becomes
problematic. A second, and related, underinvestment point concerns the
apprehension of nonmember financiers to lend to cooperatives. Since they
must risk their funds within an organizational form where they have little
control, outside financiers are reluctant to lend except on terms unfavorable to
cooperatives. At the same time cooperative members are reluctant to borrow
on terms exceeding the going interest rate and wary of relinquishing
management control to outside parties who might not share a similar
commitment to cooperative forms of organization.
2.6 COOPERATIVES AS SOCIAL ORGANIZATION:
- Cooperatives put people at the centre of their business and not capital.
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24. - Welfare of members is emphasized
- Cooperatives should engage in business activities that touch members
eg schools building, credit.
- Creation of jobs and empowerment of members
2.7 THE UPC COOP. SOCIETY (ASABA) PROFILE
- Registered 1967
- 4000 viable cooperatives as members
- 15 multipurpose unions and 7 associations
Business: Pure water, yam flour, car was Ice block making, cooperative
stationery.
2.7 CHALLENGES:
- Existing By-law needs to be reward because it does not give room for
the Cooperative to operate freely. It gives more power to state.
- Members apathy needs to change
- Information and communication gap to be reduced
- Leadership and managerial improvement
- Lows and statutes to be changed
3.8 STRATEGIES
- Reorientation of members
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25. - Awareness campaign carried out
- Members involvement
- ICT website launched
- Sensitization for more cooperator among cooperatives
- Lobby for favorable cooperative Law
- Encouraging transparency and accountability
- Education and training on continuous basis eg. End of year training for
all leaders
2.9 FUTURE PLANS
- Greater autonomy and independence coops
- Cooperative clubs for children in schools
- Introducing cooperatives in secondary school curriculum
- Introducing cooperatives in curriculum of Lagos state university.
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26. CHAPTER THREE
RESEARCH METHODS AND PROCEDURES
3.1 RESEARCH DESIGN
The research method selected for the study is a combination of a survey and
an industrial study. The survey research method is described hereunder that:
(i) It is a design in which primary data is gathered from members of the
sample that represents a specific population;
(ii) It is a design in which a structure and systematic research instrument
like a questionnaire or an interview schedule is utilized together with the
primary data;
(iii) It is a method in which the researcher manipulates no explanatory
variables because they have already occurred and so they cannot be
manipulated;
(iv) Data are got directly from the subjects;
(v) The subjects give the data the natural settings of their workplaces;
(vi) The answers of the respondents are assumed to be largely unaffected
of the Context in which they are brought;
(vii) The impacts of the confounding factors are “controlled” statistically; and
(viii) The aim of the research may span from the exploration phenomena to
hypotheses testing (stone 1995).
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27. The survey research method has some merit, which are to be articulated
hereunder: In the survey research method, the sample of the respondents is
selected in such a way as to make for the generally low due to the utilization
of big sample sizes, which results in generally low sample errors. Also the
probability sampling techniques utilized in selecting the samples of the
respondents in a survey especially, the selecting the samples of the
respondents in a survey especially, the random sampling techniques makes it
possible to give every element in the population a known and chance of
belonging to the sample and by so doing, sample bias is either minimised or
completely eliminated (Stone 1995). Sampling even as a compromise has a
lot of strength. The survey research method also has the merit that data
collection takes place in the “natural” settings of the workplace rather than an
activated laboratory. Data is collected directly from the respondents. The
advantage that the survey yields data that suggests new hypothesis is very
illuminating. There is also the merit that a set of systematic data collection
instruments such as questionnaire interview schedules and observation
gadgets can either be used alone or in conjunction with other instruments
(Stone, 1995).
The survey research method also has some demerits. There is the demerit
that there is a decreased willingness of the subjects to give responses to
survey probes. There is the demerit that most surveys are “one shot” or at
most “two short” as opposed to the panel type of research design, in which
repeated measures are taken on the same sample using questionnaires. The
result of this shortcoming is that the ability of the survey research method to
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28. yield data with which to test the causal relationships of variables is minimized
(stone, 1995).
There is also the demerit of the survey that in terms of total expenditure, the
survey research methods is a highly costly research method due to a large
administrative, and/or personnel and travel expenses especially when the
research and the field data collectors have to do several trips to get at some
subjects that were not originally available. There is also the demerit that the
structured and pre-arranged response formats of many survey measures e.g.
questionnaires and structure interview schedules many compel the subjects to
give response which they do not really accept (stone, 1995 ).
Apart from the choice of the survey research design, the industry is also
chosen for the study. The study on the internal control in the aviation industry
is for only industry and there was the need to deliver questionnaires to the
managers in at least two firing investigation in some depth.
3.2 SAMPLING
Spiegel (1992) observes that sampling theory is a study of the relationship
existing between a population or universe and the samples drawn from it. The
population in this study is the entire staff of the firm.
In order to make conclusions of sample theory and statistical references to be
valid, a sample must be selected as to be representative of the population
(Spiegel, 1992 ). One way in which a representative sample may be got, is by
the process of stratified random sampling. In this research work, the
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29. technique of simple random sampling is used to select the sample of 100
respondents from a total sample size of 200.
The list of all the senior staff in the UPC cooperative society is got from the
personnel department of the organisation. The numbers are written on a piece
of paper, put in a basket and the papers are folded to cover the numbers and
one of the pieces of paper is selected at a time without replacing it and any
name corresponding to the number becomes a number of the sample. This
method of sampling without replacement is done until the sample of 100
respondents per firm is got.
3.3 DATA COLLECTION
As earlier stated, the primary data collection instrument in this study was the
questionnaire. In the questionnaire method of primary data collection, a heavy
dependence was placed on verbal reports from the subjects to get information
on the role of packaging as a management strategy.
The questionnaire had a lot of merits. It needed less skill to administer.
Further, Questionnaire can be administered to a big number of individuals at
the same time. Also with a specific research budget, it was usually possible to
cover a brooder area and to get information from more subjects by a
questionnaire. The impersonal nature of a questionnaire, its structure and
standardized wording, its order of question, its standardized instructions for
recording answers might make one to conclude that if offers some uniformity
from one measurement occasion to another (Selltiz et al, 1976).
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30. Another merit of questionnaire was that subjects may have a bigger
confidence in their anonymity, and thus feel freer to express views they feel
might be disapproved-Another attribute of the questionnaire that is
sometimes, through not always desirable is that it might place less pressure
on the subjects for immediate response (Selltiz et al, 1976).The questionnaire
also has some demerits. It has been estimated that for purpose of giving
dependable responses to a questionnaire, one respondents must be
considerable educated, Thus one of the demerits of the usual questionnaire is
that it is appropriate only for with a considerable amount of education. There
is also the demerit that subject may be reluctant and unable to report on the
particular subject matter. Also, if a subject misinterprets a question or give his
or her answer in a batting manner, there is often a little that can be done to
ameliorate the situation. In a questionnaire, the information the researcher
gets is limited to the fixed alternative answer format, when a specific answer
is not available, it can lead to errors (Selltiz, 1976).
There is also limitation of memory in reporting on past facts. There is also a
problem beyond memory. Usually, the cause of a failure to report past facts is
not forgetting in the usual sense of the word but rather, it may be motivational.
Also the researcher is not a policeman that can compel answers. That is, the
information may not be readily accessible to the subject and thus the subject
may be reluctant to put forth enough alternative information that he or she is
only barely conscious of (Selltiz et al, 1996).
In this research project a structured and undisguised questionnaire is utilised
which is made up of two parts namely, the personal data section and the
section on the data on the actual subject matter of the work. The
30

31. questionnaire is undisguised in the sense that the purpose of the data
collection which is to collect primary data for writing up the researcher’s HND
project is made known to the 200 respondents. The questionnaire is
structured in the sense that the questions are logically sequenced and are to
be asked to the respondents in the same manner and no follow up questions
are to be allow. Some of the questions are of the fixed alternative answer
format type. Ten (10) of the questions have yes or no answers, Ten (10) of
the questions have alternative answers for the respondents to tick.
The structured questionnaire has the merit that it yields data that is easier to
analyse than data produced by an unstructured questionnaire. Also the
structured nature diminishes both researchers and research instrument
biases. It however has the demerit that the rigidity of the research instrument
diminishes the amount of information that could be got.
The method of communication of the research instrument is by means of the
personal interview. The method has the merit that it produces a better sample
of the population than either mail or the telephone methods. It also has the
merit that it gives a very high completion and response rates. It has the merit
that the interview has a bigger sensitivity misunderstandings by the
respondents and gives a chance for clarification of misunderstood questions.
It has the merit that it is a very feasible method (Selltiz et al, 1976). The
personal interview method has the demerit that it is more costly than the mail
or the telephone methods of communication of a questionnaire.
31

32. 3.4 FIELD WORK
The researcher and three other field data collectors did the fieldwork.
The field data collectors were other classmates also offering the part-time ND
program, who have also offered Research Methodology and are members of
the organisation so they had no problem getting data from the organisation .
They were to be trained by the researchers on how to gain entry , greet the
respondents and , how to tick the questionnaire correctly, and honestly.
3.5 DESCRIPTION OF DATA PRESENTATION AND ANALYSIS TOOLS
The data presentation tools were simple bar charts, histograms, and pictorial
tables. The most important parts of a table include;
(a) Table numbers
(b) Title of the table
(c) Caption
(d) Stub or the designation of the rows and columns
(e) The body of the table.
(f) The head note or prefatory note or explanatory just before the
title;
(g) Foot note, which is an explanation not at the end of the page
(h) source note, which refers to the literally or scientific source of
the table(Mills and Walter 1995)
Anyiwe (1994) has observed that a table has the following merits over a
prose information that;
(i) A table ensure an easy location of the required figures;
32

33. (j) Comparisons are easily made utilizing a table than a prose
information;
(k) Patterns or trends within the figures which cannot be visualised
in the prose information can be revealed and better depicted by
a table; and
A table is more concise and takes up a less space than a prose
formation:
The data is to be analysed by means of percentage, cross tabulation
and the z test of population proportions for testing the two hypotheses.
Percentages express the ration of two sets of data to a common base
of 100. Percentages facilitate comparison and address the problem of
the misleading tendency of absolute in which 8 over 10 is greater than
12 over 15 as the first ratio gives a percentages of 80 while the later
gives a percentages of 75 . Cross tabulation involves utilising a table
to display two or more variables. The z test of population of the
respondents who said yes to a particular yes or no question is given at
5% level of significance to a particular (Spiegel, 1992)
33

34. CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
4.1 INTRODUCTION
In the previous chapter, the research methods and procedures
have been handled. In this chapter the data presentation and
analysis are to be done. The data is to be presented by means of
tables, two simple bar charts, one histogram and one pie chart to
make it amenable for further analysis. By analysis, it meant the act
of noting relationship and aggregating the set of variables with
similar attributes and also breaking the unit of their components
(Mills and Walters 1995).
In this research work, the researcher accepts the contention of
Podsakoff and Dalton (1995) that the factual information from the
data can be used as a basis for reasoning, calculation and
discussion.
Apart from the heading above, the other headings in this chapter
includes:
1.Data presentation,
34

35. 2. Percentage analysis
3.Cross- tabulated analysis
4. Hypothesis testing
4.2 DATA PRESENTATION
TABLE 1
THE SUMMARY OF THE PERSONAL DATA OF THE RESPONDENTS
1
2
3
4
SEX
Male
Female
Total
Marital status
Married
Single
Total
AGE
21-30 years
31-40 years
41-50 years
51-60 years
Total
HIGHER
EDUCATIONAL
QUAIFICATION
DIPLOMA
OND
HND
FIRST DEGREE
SECOND DEGREE
ACA
TOTAL
FREQUENCY
150
50
200
130
70
200
90
90
10
10
200
10
30
80
20
40
20
200
Angles
suspended
in degree
18
54
144
36
32
36
360
35

36. In the marital statuses of the 200 respondents above, it is found that 130
of them are married while 70 of them are single. For the ages of the 200
respondents they are 21-30 years, 31-40 years, 15-60 years with
frequencies of 90 and 10 respectively. For the highest educational
qualification of the 200 respondents they are diploma, OND, HND, First
Degree, Second Degree, A.C.A. and they have frequencies of 10, 30,
80, 20, 40 and 20 respectively.
Figure 4.1 below shows the simple bar chart of the data on the sex of the
respondents
FIGURE 4.1: THE SIMPLE BAR CHART OF THE DATA ON THE SEX OF THE
RESPONDENTS
Source: from data in table 1
36
MALE
FEMALE
50
70
80
90
100
110
120
130
140
150
160
150
M F Sex of the respondents

37. MARITAL STATUS OF THE RESPONDENTS
MARITAL STATUS OF THE RESPONDENTS
SINGLEMARRIED
Frequency
140
120
100
80
60
40
20
0
From figure 4.1 above, it is shown that male respondents have the
modal frequency of 150 of the 200 respondents while the female
respondents have the frequency of 50 only.
Figure 4.2 below shows the simple bar chart of the data on the
marital statuses of the respondents.
FIGURE 4.2: THE SIMPLE BAR CHART OF THE DATA ON THE MARITAL
STATUSES OF THE RESPONDENTS
37
MARITAL STATUS OF THE RESPONDENTS
Frequency Percent Valid Percent Cumulative
Percent
MARRIED 130 65.0 65.0 65.0
SINGLE 70 35.0 35.0 100.0
Total 200 100.0 100.0

38. From figure 4.2 above, it is shown that the married respondents
have the modal frequency of 130 out of the 200 respondents while
the single respondents have the frequency of 70 of them.
FIGURE 4.3: THE HISTOGRAM OF THE DATA ON THE AGES
OF THE RESPONDENTS.
38
AGE OF THE RESPONDENTS
Frequency Percent Valid Percent Cumulative
Percent
21 - 30 YEARS 90 45.0 45.0 45.0
31 -40 YEARS 90 45.0 45.0 90.0
41 - 50 YEARS 10 5.0 5.0 95.0
51 - 60 YEARS 10 5.0 5.0 100.0
Total 200 100.0 100.0
AGE OF THE RESPONDENTS
4.03.02.01.0
AGE OF THE RESPONDENTS
Frequency
100
80
60
40
20
0
Std. Dev = .78
Mean = 1.7
N = 200.00

39. SOURCE: From the data in Table 1.
From figure 4.3 above, it is shown that the age classes are 20.5-30.5
years, 30.5-40.5 years, 40.5-50.5 years and 50.5-60.5 years with
frequencies of 90, 10, and 10 out of 200 respectively. This shows that
this is a bi-modal distribution as the age classes of 20.5-30.5 years and
30.5-40.5 years have a frequency of 10.
Figure 4.4 below shows the pie chart of the data on the highest
educational qualifications of the 200 respondents.
FIG.4.4 THE PIE CHART OF THE DATA ON THE HIGHEST
EDUCATION QUALIFICATIONS OF THE 200 RESPONDENTS
39
EDUCATIONAL QUALIFICATION OF THE RESPONDENTS
Frequency Percent Valid Percent Cumulative
Percent
Valid DIPLOMA 10 4.8 5.0 5.0
OND 30 14.3 15.1 20.1
HND 80 38.1 40.2 60.3
FIRST DEGREE 19 9.0 9.5 69.8
SECOND DEGREE 40 19.0 20.1 89.9
ACA 20 9.5 10.1 100.0
Total 199 94.8 100.0
Missing System 11 5.2
Total 210 100.0
EDUCATIONAL QUALIFICATION OF THE RESPONDENTS
Missing
ACA
SECOND DEGREE
FIRST DEGREE HND
OND
DIPLOMA
38.1%
9.0%
19.0 %
9.5 %
5.2 %
5.0%
15.1%

40. SOURCE: From the data in table 1.
From figure 4.4 above, the Highest Educational Qualifications are
Diploma, O.N.D, First Degree, Second Degree and A.C.A and the
subtend angles equal to 180
, 540
, 1440
, 360
, 720
and 360
and
respectively at the center of the circle.
`4.5 CROSS – TABULATED ANALYSIS
Table: 3 below shows the analysis of the statuses of the 200
respondents
TABLE: 3 THE ANALYSIS OF THE STATUSES OF THE 200
RESPONDENTS
CROSS-TABULATION 1
Cooperative plays a leading role in poverty
reduction
YES NO NO
ANSWER
DON'T
KNOW
Total
DIPLOMA 10 10
OND 30 30
HND 70 10 80
FIRST
DEGREE
20 20
SECOND
DEGREE
40 40
ACA 9 11 20
Total 110 70 9 11 200
40

41. The above table shows that the total of 100 respondents
(out of 200 said YES. This proved that Cooperative plays a
leading role in poverty reduction
The above table indicates that Cooperative do grant credit to empower
members to own their own business . 104 respondents out of 200 said
yes. While 40 did not agree with the fact.
PERCENTAGE ANALYSIS
Table below shows the percentage analysis of the responses to the yes
or no Questions.
41
CROSS-TABULATION 2
10 10
30 30
75 5 80
20 20
40 40
9 11 20
115 65 9 11 200
RESPONDENTS’
EDUCATIONAL
QUALIFICATION
DIPLOMA
OND
HND
FIRST DEGREE
SECOND DEGREE
ACA
Total
YES NO
NO
ANSWER
DON'T
KNOW Total
Cooperative do grant credit to empower members to own
their own business

42. 42
S/N QUESTIONS YES % NO % TOTAL
IN NUM.
TOTAL
IN %
1 DOES COOPERATIVE SOCIETY
CREATE MPLOYMENT TO
MEMBERS?
110 55 90 45 200 100
2 DO COOPERATIVE SOCIETY
GRANT CREDIT TO EMPOWER
MEMBERS TO OWN THEIR OWN
BUSINESS?
115 57.5 85 42.5 200 100
3 DOES COOPERATIVE SOCIETY
CONTRIBUTION TO GDP ?
109 54.5 91 45.5 200 100
4 DOES ADVOCACY AND
LOBBYING FOR BETTER
LEGISLATION ONE OF THE
ROLES OF THE COOPERATIVE
SOCIETY?
123 61.5 77 38.5 200 100
5 Do cooperative society offers Better
services to members to enable them
increase their income?
155 77.5 45 22.5 200 100
6 Cooperative society helps to
Improve business entrepreneurial
skills
111 55.5 89 44.5 200 100
7 Cooperative society plays a leading
role in poverty reduction
130 65 70 35 200 100
8 Cooperation is unique because it
promotes.
* Reliance &
* Empowerment
122 61 78 59 200 100
9 Is Cooperative society organization
owned by the people and for the
people
111 55.5 89 44.5 200 100
10 Do Cooperative society put people
at the centre of their business and
not capital.
128 64 72 36 200 100
11 In cooperative society, is Welfare of
members is emphasized?
111 55.5 89 44.5 200 100
12 Do cooperatives engage in business
activities that touch members eg
schools building, credit?
150 75 50 25 200 100
13 Is Creation of jobs and
empowerment of members one of
the functions of the firm?
100 50 100 50 200 200

43. 4.3 HYPOTHESIS TESTING
In attempting to arrive at decisions about the population, on the basis of
sample information, it is necessary to make assumptions or guesses about
the population parameter involved. Such an assumption is called statistical
hypothesis, which may or may not be true. The procedure, which enables the
researcher to design on the basis, is sample regards whether a hypothesis is
true or not is called test of hypothesis or test of significance.
The null hypothesis asserts that there is no significant difference between the
statistics and the population parameters and what ever is observed difference
is there, is merely due to fluctuations in sampling from the same population.
Null hypothesis is thereby denoted by the symbol H0. Any hypothesis, which
contradicts the H0, is called an alternate hypothesis and is denoted by the
symbol H1. The researcher used chi-square analysis.
4.4 CHI-SQUARE TEST
The c is one of the simplest and most widely used non-parametric test in
statistical work. It makes no assumptions about the population being sampled.
The quantity c describes the magnitude of discrepancy between theory and
observation i.e. with the help of c test we can know whether a given
discrepancy between theory and observation can be attributed to chance or
whether it results from the inadequacy of the theory to fit the observed facts. If
c is zero, it means that the observed and expected frequencies completely
43

44. coincide. The greater the value of c the greater will be the discrepancy
between observed and expected frequencies.
The formula for computing chi-square is –
c =∑ (O-E)2/E
Where,O=Observed frequency
E=Expected or theoretical frequency
4.5 SOFTWARE USED FOR DATA ANALYSIS:
For the data analysis and the interpretation, the researcher has adopted
advanced version of SPSS (statistical package for social science). This
application software has facilitated the researcher to construct the frequency
table, various types of charts and to find out the valid percentage responses
from the sample. By this automated data analysis it has minimized the
researcher’s time constraints and reduced human error and give also
accurate outlay of information.
Chi-Square Test (1)
The liability of the members is unlimited
Observed
F
Expected
F
Residual Decision
YES
NO
DON’T
KNOW
NO
ANSWER
Total
100
43
39
18
200
50.0
50.0
50.0
50.0
50.0
-7.0
-11.0
-32.0
Accept
Reject
Reject
Reject
44

45. Chi-Square Test (2)
Cooperative do grant credit to empower members to own their
own business
Residuals
The observed value of the dependent variable minus the value
predicated by the regression equation, for each case. Large
absolute values for the residuals indicate that the observed values
are very different from the predicted values.
SOURCE: From the questionnaires administered.
The formulated hypothesis that is subject to statistical test is at 5%
level of significance in testing hypothesis, the calculated value of
the test statistics is usually compared with tables of value. The
45
Observed
F
Expected
F
Residual Decision
YES
NO
DON’T
KNOW
NO
ANSWER
Total
104
40
47
9
200
50.0
50.0
50.0
50.0
54.0
-10.0
-3.0
-41.0
Accepted
Rejected
Rejected
Rejected

46. critical values of the test statistics serve as criterion value. It
afforded the basis for rejecting the null hypothesis is a function of
the value of the tested statistic.
Reject the null hypothesis if the calculated value of the test statistic
is greater than the critical value.
Accept the null hypothesis if the calculated value of the test statistic
is less than the critical value.
TEST STATISTICS
note: df = degree of freedom
4.6 SUMMARY OF RESULT
Level of significance……….0.05
Critical value………………………43.0
Calculated value……………………73.880
46
The liability of the
members is
unlimited.
The society is
managed by
one person
only.
Chi-Square
df
73.880
3
94.120
3

47. From the above analysis, it could be seen that in the first test, The
liability of the members is unlimited, the calculated value is greater
than the critical value so we reject the hypothesis.
In the second test which state that The society is managed by one
person only, the level of significance is 0.05, the critical value is 44
while the calculated value from the test statistics table is 94.120.
Looking the data above, it shows very clear that the calculated
value is greater than the critical value so we reject the hypothesis.
47

48. CHAPTER FIVE
FINDINGS, SUMMARY AND RECOMMENDATION
5.1 FINDINGS
-A co-operative society is a voluntary association of individuals
having common needs who join hands for the achievement of
common economic interest. Its aim is to serve the interest of the
poorer sections of society through mutual help.
 -Membership of co-operative societies is voluntary and open to all.
It is democratically managed and it has a separate legal
existence . The main motive is to provide service to the members.
It works on the principle of self help through mutual cooperation of
members.
48

49.  A co-operative society can be formed under the Co-operative Act,
with a minimum of ten members. For registration, an application
along with bye-laws of the society has to be submitted to the
Registrar of Co-operative Societies.
 -Co-operative societies may be classified as follows:
1) Consumers’ co-operative society - formed to eliminate the role
of middlemen and supply high quality goods and services at
reasonable price to consumers.
2) Producers’ co-operative society - formed to help producers to
procure raw material, tools, equipment etc.
3) Co-operative marketing society - formed to ensure a favourable
market for small producers to sell the output and get a good return
on sale.
4) Co-operative credit society - formed to provide financial help to
members through loans at low interest rates. They encourage
saving habit among members.
5) Co-operative farming society - formed to achieve economies of
large scale farming and maximization of agricultural output.
6) Housing co-operative society- formed to provide residential
houses to members by constructing them or providing loans to
members to construct their own houses.
49

50.  Co-operative societies are easy to form and have a stable life.
Membership is open to all and members have limited liability.
There is democratic management based on ‘one-man, one vote’.
The societies have stable life and they enjoy government
patronage.
 They suffer from insufficient capital, problems in management and
conflict among members. There is lack of motivation in members
due to absence of direct reward for individual effort. Excessive
government regulation and control may also pose problems for
them.
 Co-operative societies are suitable in protecting exploitation of
weaker sections of society and promoting their economic interest.
It is ideal where service motive, and not profit, is the priority.
5.2 SUMMARY
Cooperative method remains the vibrant economic technique of
poverty eradication, wealth creation, job creation and rural
development and SMEs financing. There are various problems
militating against the performance of cooperative societies in
50

51. Nigeria. Also the changing world of technology poses great
challenges to the efficiency of cooperative societies in Nigeria
most cooperative societies are operating with inadequate capital to
cope with the need of SMEs.
5.3 RECOMMENDATION
- Immediate review of the cooperative law in line with the
cooperative Development Policy that would re-position the Director
of cooperative, service was suggested.
- a base line study; to allow data base and statistics on registered
societies, to allow data base and statistics on registered societies,
members savings mobilized, total reserves, loans disbursement,
percentage recovered, nature and types of cooperative societies
existing in the country, that are required for effective planning.
- Research suitable for planning more effective cooperative
education and training programmes for committees, members and
employees of cooperative is highly essential to fit with the
changing environment.
- Government should liberalize cooperatives by loosening its grip
on cooperatives to allow for self-help and self-responsibility
principles of cooperativeness.
51

52. - Investment in Information and Communication Technology (ICT)
has become imperative for a success-drive cooperatives. On-line
update of members' passbooks, loan application, etc should be
incorporated into the business of cooperatives. Otherwise, such a
cooperative will be living in the past.
- A guided recapitalization of the cooperative sub-sector
- Fund channelization through the cooperative societies by the
Government, NGOs and commercial banks for sustainable SMEs.
52

53. REFERENCES
Abrahamsen, M.A (1976) Cooperative Business Enterprises MC Craw Hill
books company New York
Akinwumi, J. (2006): Road Map to re-engineering Cooperatives in Nigeria; A
paper presented at the south west cooperative leaders conference, organized
by cooperative federation of Nigeria South west zone at Obisesan Hall,
Ibadan, September 7th.2006.
Asaolu, T. O.(2004): Evaluation of the performance of the Cooperative
Investment and Credit Societies (CICS) in financing Small-Scale Enterprises
(SSEs) in Osun State, Nigeria.
Ayoola (2006): Nigerian cooperative movement: "Yesterday, Today and
tomorrow" A paper presented at conference for cooperative leaders and
members organize by cooperative federation of Nigeria South west Zone.
53

54. Epetimehin, F. M. (2006): Understanding the Dynamics of Cooperatives,
Tadon Publishers, Ibadan.
Frank, R.H Gilorich T & Regan, D.T (1999): "Does studying Economics Inhibit
cooperation" gnu@gnu.org: free software foundation incorporation Boston,
U.S.A.
International cooperative Alliance congress (ICA) (1995), Centennial
Congress and General Assembly, Manchester.
International Labour Office, 1960, cooperative management and
administration Geneva.
Lawal, T.O 2006: Introduction to modern cooperative management, Akure,
alibi-Eyo&co Ltd.
Olesin, Ayo (2007) "making Cooperative societies work for you", Sunday
business in Sunday Punch Newspaper 18th, February, 2007 pg7.
Onuoha, Enyeribe 1986: Principles of cooperative enterprise, Enugu Nigeria,
Express publishing company ltd.
Rana, J.M 1970: AO,s and principles of cooperatives and Applications in
different Asian countries (in Ilo Reports, Geneva).
54

55. Roy, I. (1964). Cooperatives Today and Tomorrow, Genera.
Reeves, M (2003): A wealth of opportunities in a World of Limits: Free
Enterprises. Economics of Cooperation, Federal Reserve Bank of Dallas;
www.dallasfed.org
The Nation, Newspaper, "President Obasanjo Lunches National Policing on
consumer credit and out sourcing NAPPCO", editorial, Friday, January12,
2007, pg.4
Wikipaedia (2006). Economic Development, www.wikipaedia.com
55