Factors affecting the performance of cooperatives: A case study in Vietnam

Abstract

Background: Cooperatives are independent organizations in which members voluntarily collaborate to meet mutual economic, social, and cultural goals through collective ownership and democratic management. The role of cooperatives in socioeconomic development is increasingly being recognized, and they are becoming the target of economic managers.

Objective: The study aims to explore the key factors affecting cooperatives' performance in Vietnam. Besides, the authors proposed policy recommendations for enhancing the performance of cooperatives.

Methodology: The authors conducted a group discussion of managers experts with ten persons with doctoral degrees in business administration, quantitative methods, and primary data collected directly from the sample size of 400 managers of cooperatives from five major cities and five provinces in Vietnam, using a random sampling technique, offline and online serving.

Result: The results show that five main factors affect the performance of cooperatives in Vietnam, with a significance level of 0.05 and a substantial impact on cooperative management capacity. Research results suggest that managers should strengthen and enhance cooperative management capacity to promote cooperative performance.

Conclusion: Studying the performance of cooperatives in Vietnam reveals that it depends on many main factors. External factors directly include the socioeconomic environment and support policies for cooperatives. Internal factors are non-economic factors that indirectly contribute to cooperative performance.

Unique Contribution: Cooperatives' novelty in performance lies in their unique business model, which emphasises collective ownership, democratic decision-making, and a focus on community and member benefits rather than profit maximisation, especially in offering innovative solutions.

Key Recommendation: The study has pointed out the five critical factors affecting cooperative performance. It also helps managers have an overview of cooperative performance to provide directions and policies for cooperative development in the coming time, significantly improving cooperative management capacity.