Final answer:
A cooperative business arrangement is known as a cooperative, or co-op, which is a nonprofit, voluntary association of members who are also owners, joining forces for mutual economic benefit. These include consumer cooperatives, producer cooperatives, and service cooperatives, all operating democratically to serve member needs.
Step-by-step explanation:
A cooperative business arrangement between two or more companies may be referred to as a cooperative, or simply a co-op. Cooperatives are nonprofit, voluntary associations where the members are also the owners, working together for mutual benefit. For instance, consumer cooperatives like Sam's Club or Costco purchase items in bulk and pass the savings on to their members. Producer cooperatives, like Dairy Farmers of America or Sunkist Growers, collaborate to get the best possible prices for their products. Service cooperatives provide services like credit unions or insurance for their members. In all these types, the goal is to meet the shared needs and aspirations of the members, often offering better pricing and services than could be achieved individually.
General partnerships and cooperatives share the concept of shared responsibility and profit among stakeholders, but cooperatives specifically function as nonprofit entities serving their members. Organizations may grow and merge, which can lead to various business structures including conglomerates or corporations. A corporate merger involves the amalgamation of two private firms, while an acquisition is when one firm buys another. On the other hand, cooperatives strive to operate democratically and for the direct service of their participants' needs.