Entrepreneurships and Cooperatives: Benefits to the Community

Entrepreneurships and Cooperatives: Benefits to the Community

Target Grade Level / Age Range:

Grades 9-12

Estimated Time:

Two, 45-minute class periods

Purpose:

Students will learn how entrepreneurships and cooperatives benefit local communities.

Materials:

  • Whiteboard and markers
  • Printed entrepreneurship profile cards and case studies (linked below)
  • Notebook paper
  • Pencils/pens

Essential Files (maps, charts, pictures, or documents)

Vocabulary  

  • Entrepreneurship: the activity of setting up a business or businesses, taking on financial risks in the hope of profit
  • Cooperative: a farm, business, or other organization which is owned and run jointly by its members, who share the profits or benefits
  • Standard of living: the level of income, comforts and services available, generally applied to a society or location, rather than to an individual
  • Community: a group of people living in the same place or having a particular characteristic in common
  • Market: a place where buyers and sellers can meet to facilitate the exchange or transaction of goods and services
  • Economy: the wealth and resources of a country or region, especially in terms of the production and consumption of goods and services
  • Economies of scale: a proportionate saving in costs gained by an increased level of production

Background – Agricultural Connections 

This lesson is split into two parts: how entrepreneurships impact the community and how cooperatives impact the community. The entrepreneurship section focuses on benefits like job creation and local economy benefits. If a new business joins a community, the business can hire new people in that community. This can increase the population in the community by bringing in folks to take some of the new jobs. This can also lead to support industries in the community, such as hotels, restaurants, construction, etc. The local tax revenue then generated either through optional sales taxes or property taxes can then be used to better the community by repairing streets, funding schools, and more.

The cooperative section focuses on benefits like job creation and economies of scale. Cooperatives can take many forms, and each type of cooperative can have different benefits. Some common agricultural cooperatives are centered around a commodity, like grain, meat, or dairy. This section of the lesson uses the Land O’Lakes dairy cooperative as an example, which pools member dairy farmers’ resources and dairy to market more effectively and to do more research to create better dairy products. This provides significant benefits to the member farmers who don’t have the resources or ability to do all of that marketing and research on their own, and it benefits the consumer by providing better products. Cooperatives also employ people, leading to many of the same benefits to the community as entrepreneurships.

Interest Approach – Engagement 

  1. Start by reviewing what the students know about entrepreneurships and cooperatives. 
  2. Draw a Venn Diagram on the board with one side for entrepreneurships and one side for cooperatives. Take comments from students to fill in the Venn Diagram with things they remember from the previous lesson, or from other sources. Potential comments:
    1. Entrepreneurships: Small business, self-started, high risk/high reward, new ideas
    2. Cooperatives: Group of individuals, collective bargaining, small or large
    3. Both: Parts of a healthy economy, business strategies, meet needs of the public (new goods, fair wages, etc.)
  3. Give students a minute to think about how these business models impact the communities they exist in. That is what you will discuss the next two class periods!

Procedures

Day 1 – How do entrepreneurships benefit the community?
  1. Look back at the Venn Diagram and revisit the entrepreneurship section. Summarize what an entrepreneur is and what that means.
  2. Explain to the students that you will now be doing an activity to display how entrepreneurships impact their local communities.
    1. Begin handing out the entrepreneurship profile cards, one to each student, face down. Be sure that the “entrepreneur” and “rancher” cards are handed out, but any other combination of roles is ok.
    2. Tell students that their card has a role and a description written on it. Tell students that the people represented on these cards are a part of a community together, and they will need to think critically about how their roles interact.
    3. Allow students a couple minutes to read their cards and think on what that means.
    4. Next, instruct the student with the entrepreneur card to read their card aloud. Tell the students to think about how this person and their business would impact your character specifically. Tell the students that you will take turns between students to hear about each character and how they envision their characters impacting each other. If the class is large or time is an issue, not every student would have to share. 
    5. The next student to share could be the rancher. Instruct the student to read their card and describe how the entrepreneurship would impact them.
    6. Allow students to take turns and share their character summary and how they think their character would be impacted by the entrepreneurship. If students have trouble connecting the dots, follow up with pointed questions to help them.
    7. When students have completed sharing, discuss as a whole group what they noticed. It seems that a new business would be good for a community. New businesses can hire people, which could bring new people to a town, raising city’s property tax revenue. New people in a town could help fix up older houses, support other local businesses, spend money locally resulting in local sales tax revenue. Local tax revenue would support local schools and infrastructure. This business specifically would also help with public health concerns locally. 
  3. Next, tell students that you’d like them to write a short paragraph explaining how your character’s standard of living would be impacted by the entrepreneurship in the activity. Give them ~10 minutes to write a few short sentences.
  4. As a class, use this information to analyze the case study of John Deere.
    1. Hand out printed copies of the attached 1-page case study to students. Either give students a couple minutes to read silently to themselves or quickly have 1-4 students read the sheet aloud.
    2. As a group, summarize the case study. 
      1. John Deere was a blacksmith who developed a new kind of plow. The plow helped settlers in the Midwest break up the thick, heavy sod more easily. Deere moved his company to Moline, Illinois in 1848, and the John Deere company is still the largest employer in the town today.  
    3. What were the impacts of John Deere’s plow? What were the impacts on Moline specifically? Global impacts? Societal impacts?
  5. To wrap up, create a short Kahoot! or interactive quiz to summarize learning. Include questions like:
    1. An entrepreneur is a person that starts their own business. (T/F)
    2. Entrepreneurs can bring new jobs to a community. (T/F)
    3. John Deere impacted society by:
      1. Creating new jobs in Moline, IL
      2. Inventing a useful new good
      3. Founding a company that now employs thousands
      4. All of the above
    4. Entrepreneurships positively benefit their local community. (T/F)
Day 2 – How do cooperatives benefit the community?
  1. Start by reviewing what a cooperative is.
    1. Cooperatives are businesses that are owned by a group of members. The function of the cooperative is to mutually benefit all members. Both profit and risk are distributed across members, collectively benefitting all. Members have an equal say in the cooperative, and it functions under democracy.
    2. There are many types of cooperatives, from housing, energy, and food purchasing co-ops, to agricultural co-ops.
    3. Agricultural cooperatives can take many forms, but generally can help farmers (independent business owners) receive a fair price for their goods by banding together with other farmers. For example, grain cooperatives will purchase grain from many members and market them all equally to benefit all farmers who are members of the cooperative. Similar cooperatives are available for meat (West Liberty Foods turkey cooperative) and milk (Land O Lakes dairy cooperative).
    4. Allow for clarifying questions as needed.
  2. Next, tell the students they will be thinking through how the cooperative business model would impact a community.
    1. Tell the students they will be pretending to be grain farmers. They have many tasks to accomplish each day. They are each independent business (farm) owners. How they make their money is to sell their grain. However, marketing can take a lot of time. Would they rather do all of their marketing and delivery on their own, or would they rather form a group that collectively markets and delivers everyone’s grain?
    2. Discuss with the group what their thoughts are. 
    3. Some students might say that they’d have more of a say and more control if they did everything themselves. Others might see the benefit in outsourcing the marketing and delivery while also eliminating the competition between neighbor farmers and increasing each farmer’s power in the market.
  3. Next, hand out the Land O’Lakes case study sheets (attached) to each student. Either have students read silently to themselves or take 1-4 volunteers to read the sheet aloud.
  4. Recap the case study as a whole group. What was the purpose of this cooperative? How does it benefit the members? How does it benefit employees? How does it benefit the communities it is a part of?
    1. The cooperative structure allows for the pooling of resources that results in greater marketing and product development than any one farmer would be able to obtain on their own. This also provides a number of new jobs within the cooperative that benefit the community in very similar ways that an entrepreneurship would (new jobs, increased local revenue, stronger communities as a whole). The research that comes out of the pooled resources leads to new technologies that increase the standard of living (sweet butter and stick butter benefitted the farmer members and consumers enjoy it).
    2. Brainstorm quickly how different kinds of cooperatives might have slightly different goals, but similar structures or functions.
  5. To wrap up, consider creating a Kahoot! quiz to gauge student understanding. Include questions like:
    1. By participating in a cooperative, a farmer member would increase their power in the market. (T/F)
    2. Cooperatives create jobs in research, marketing, transportation, and more. (T/F)
    3. Cooperatives can support communities by:
      1. Saving members’ time marketing their goods
      2. Shielding members from total risk
      3. Spreading profits among members
      4. All of the above
    4. A community benefits when business owners succeed, because…
      1. They can employ more people
      2. They spend money locally at other businesses
      3. The money they spend locally creates tax revenue for their community
      4. All of the above

Did you know? (Ag facts)

  • There are more than 3,000 agricultural cooperatives in the U.S.

Extension Activities 

  • Assign students to write an essay on an idea they have for either an agricultural entrepreneurship or an agricultural cooperative.
  • Assign them to summarize the business model and include information on how the community would be impacted. How would it impact the standard of living in the community? Would it create competition in the marketplace? Would it increase or decrease career opportunities in the community?

Suggested Companion Resources 

Sources/Credits

Author(s) 

Chrissy Rhodes

Organization Affiliation 

Iowa Agriculture Literacy Foundation

Agriculture Literacy Outcomes

  • Describe essential agricultural careers related to production, consumption, and regulation 
  • Identify farm ownership in relation to processor ownership (e.g., cooperatives, corporations, vertical integration) 

Iowa Core Standards

  • Social Studies 
    • SS-FL.9-12.14. Evaluate entrepreneurship, career choices, and the effect on the standard of living.
    • SS-WH.9-12.16. Examine the ways in which trade, commerce, and industrialization affected societies.
    • SS-Econ.9-12.16. Describe how changes in the level of competition can affect price and output levels in specific markets.
    • SS-Econ.9-12.21. Explain why advancements in technology and investments in capital goods and human capital increase economic growth and standards of living.