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CHAPTER ONE

1.0     INTRODUCTION

Abia State is one of the states that was created in August 1991 by General I. B. Babangida. The head of state inherited a total number of 3.758 cooperative societies from Imo State. But this figure increased immensely as a result of individual desires and government encouragement together with the benefit from the formation of cooperative societies.

This cooperative society is formed when a group of people with common interest decide to cooperate, rather than in dealing with a common set of supplier. Cooperative is wide spread and very important to both the members, customers entire public and the government as well as those in marketing, production, distribution etc of good and services at a fair price to those that need them.

Despite the energetic efforts towards the development of the system customers have not yet been fully convinced since it has been known that the aim of private traders is to buy cheap and sell at higher price but are theoretically restrained in the price that can change consumers or the users of their goods because government regulates prices for a whole range of commodities regarded as necessities. Infact ministry seems to regard the elimination of private middlemen as desirable. Cooperatives are set up with government encouragement and guidance goods from given localities and take them to a grouping centre to sell to the public, these goods could be vegetables such as potatoes, meats, onions, beans, rice etc. The various types of cooperative societies in Abia State are farmers, multipurpose cooperative society, Golden Guinea Breweries, Multipurpose Cooperative Society Ltd. Umuahia timber Dealers Multipurpose Cooperative Society Ltd.

1.1     BACKGROUND OF THE STUDY

The strength and weakness of cooperative societies can be treated with reference to some of the major tasks of cooperative societies which is to bring to the customers the best quality food and goods at reasonable price. Majority of farmers in Abia State are food crop producers in receptive there is increasing fluctuation in the price and supply of food crops in the state. To determined by the force of demand and supply in the market quality and quantity of these products that enter the market from many producers and indeficit to market their products existed in Nigeria and are designed to produce the living standard of the class during inflation.

1.2     STATEMENT OF PROBLEM

Some members of cooperative societies are experiencing considerable difficulties in the sale of their product like food crop by unscrupulous marketing agents. In Abia State today self-sufficiency in food production is very important to the government in view of the apparent wide special food shortage due to neglect of Agriculture. This in effect has led to food production being carried out by small scale farmers in rural areas mostly for home consumption. Majority of consumers complain that cooperatives operate like a close-shop to the exclusion of non-members. While the cooperators themselves complain of instability for production, storage, distribution and marketing of food crops as a result of which are incurred due to spoilage and loss of quality. Inadequate capital or fund makes it difficult for the cooperative to provide efficient and effective production facilities and equipment many retailers, producers, distributors etc see cooperative as a dumping ground for their products. This research will look into these weakness and more with a view to providing solutions/recommendations to tackle them.

1.3     OBJECTIVE OF THE STUDY

The objective of this study generally is to find out the strength and weakness of cooperative society in Abia State to be specific this study is meant to determine the efficiency of cooperative period and present local firm being sheltered from internal and external completion from/exploiting consumers. Price control are regarded as a mere officious alternative to income redistribution or over all wage. Thus, produce should not be exploited by merchants so in an attempt to maintain stable prices of there products and many producers buyers, consumers etc have succeeded to form cooperative societies in the state. There sole aims are:

1.  To market the products of their members to their advantages. 

2.  Raising of fund from which loan can be granted to members production purpose.

3.  To obtain loan unbehalf of members from financial institutions.

4.  To obtain supply of raw material.

5.  The provision of other service to their members.

However the cooperatives performance in terms of marketing turnover, maintaining fair and stable price for food crops, gross margin, distribution cost, loan situation and other objectives are of the opinion that cooperatives have not been efficient in their activities. This is why it becomes important and necessary to examine the strength and weakness of cooperative societies in Abia State. To suggest way of enhancing their performance.

-  To identify the problems of cooperative in carrying out their operation in the state.

-  To identify the importance of cooperative in the state.

-  To recommend ways and means by, these cooperation to the satisfaction of needs and wants of both their members and potential customers.

1.4     SCOPE OF THE STUDY

Abia State is the focus of this study. It is made up of seventeen local government area. Because of time available for this study, it will not be possible to conduct the survey in all local government areas in the state, as such I will conduct study on three local government areas in Abia State, therefore, the three local government areas in Abia State studies for the purpose of this research are:

1.  Ukwuano Local Government

2.  Aba North Local Government

3.  Arochukwu Local Government