Although a co-operative is not formed with the aim of making profits, most co- operatives do have a bit of profit to divide up after paying employees and meeting other expenses. In a co-operative all the members own the profits. If the co- operative has money left over after it has paid all its debts and taxes and provided the planned benefits to its members, this is called a “surplus”. The surplus is normally used to develop the co-operative. For example, a co-operative can use its surplus to expand and develop the co-operative’s business or the services it offers to its members. But if there is an extra unplanned surplus, this means that (in a worker co-operative) the wages could have been higher or (in a service co-operative) the prices or fees or commissions charged for the service were too high. In this case, the surplus can be returned to the members, or used to support other activities approved by the members. Any surplus that is returned to the members must be shared in proportion to the contribution each member made to the surplus. For example, a grocery co-operative might return a portion of its surplus to its members, in proportion to the value of the purchases made by each of them during the year.

Overall, members do not usually receive a big return on the amount they contribute to the capital of the co-operative when they become members. This makes a co- operative different from a company. A shareholder in a company buys shares in the hopes of making a profit. A member of a co-operative joins the co-operative and contributes to its capital because the co-operative will provide a benefit to its members.