AECI listed among top cooperatives in country

by Karen E. Culp

SBJ Staff

Springfield-based Associated Electric Cooperative Inc. is ranked among the top 100 revenue-producing cooperatives in the nation.

AECI was No. 60 on the list of top cooperatives for the 1998 fiscal year. The report was published in early October by National Cooperative Bank, which has published the report each year since 1992.

AECI was also included in the list for fiscal 1997 at No. 68. National Cooperative Bank ranks the top 100 cooperatives with at least $325 million in revenue.

"This ranking notes our position as a successful company that is doing what we set out to do," said Nancy Southworth, manager of corporate communications for AECI.

Farmland Industries of Kansas City was the No. 1 cooperative on the list. Coming in at No. 3 was Dairy Farmers of America, a milk marketing cooperative. DFA comprises four merged cooperatives, the largest of which was the former Mid America Dairymen, which was based in Springfield prior to the merger.

Cooperatives are either producer-owned, consumer-owned or worker-owned, but all are member-owned, according to the National Cooperative Bank's release.

Members have a say in the business on a one-member, one-vote basis, in contrast to shareholder-owned companies where a single person can own more than one share and therefore have more than one vote, the release states.

Southworth said cooperatives take a little more time with the decision-making process than do other corporations.

"Since we are member-owned, it takes a little time to go through the member voting and decision-making process. We have a 12-member board that represents the 56 cooperatives that are part of our system, and that all of those are fairly represented is very important to us," Southworth said.

Most of the cooperatives listed in the top 100 are agricultural (42), but the other businesses represented include grocery (21), hardware and lumber (seven), finance (12) and utilities (11).

The listing considers the cooperatives' revenues and asset growth as the major factors for its listing. The revenue consideration is especially interesting with regard to AECI, Southworth said. The cooperative strives to keep the rate it charges per unit of energy low, and it is one of the country's lowest priced wholesale electric providers, she said.

"Because the revenue per kilowatt hour we are receiving is low, that means in order to show an overall high level of revenue we must be selling a lot of kilowatt hours. In other words, we are not making a lot of revenue because we have high prices but because we have high sales," Southworth said.

The cooperative's move up eight spaces in this year's ranking shows that it is achieving some of its established goals, Southworth said.

"This is representative of the fact that we have taken all the necessary directions toward improving our production, efficiency and reliability," Southworth said.

National Cooperative Bank listed as its top cooperative Farmland Industries, with more than $8 billion in revenues. DFA was third with $7.3 billion, and AECI was shown as having $584 million, compared to $541 million in fiscal 1997.

The size and strength of the cooperatives listed is evidence that cooperatives are still a viable part of the nation's economy, the report states. Southworth agrees.

"I think cooperatives have a very good future. They are good businesses that provide an important service to members," she said.

AECI is owned by its members, the people to whom it sells its product, and that adds a level of accountability to its work, she said.

"Every decision is member-directed. Our objective is to provide our members with reliable power at the best possible price. If we are doing that, then we will be successful," Southworth said.