Factors Influencing Performance Of Co-operatives; A Case Of Mbeere North Sub-county, Kenya

Abstract

Cooperatives have largely been considered a community development tool by the international community due to their efficient resource mobilization, utilization and enhanced economies of scale. Cooperatives in Mbeere North Sub-County have a record of poor performancesuch as low capital growth. The purpose of the study is to establish the factors that influence the performance of cooperatives in Mbeere North Sub-County. Four objectives were formulated to guide the study which bears delimitation to membership size, education level and training, level of income and quality of management. The literature reviewed revealed that the variables under investigation are relevant. These variables are consistent with the principles of cooperatives as a vital basis on which cooperatives are built and designed to ensure success. Large membership sizes in organizations like cooperatives lead to economies of scale while on the other hand it may lead to interaction problems such as free-riding .The level of education and training is crucial on issues of management of organizations since it depicts personal productivity. The level of income for members has been found to have significant impact on performance of cooperatives since it influences member participation especially contributions as required. The study employed a descriptive research design. Systematic random sampling was used in data collection to identify respondents for data collection from active cooperatives in the study area. The population was 1526 members of the active cooperatives. The formula suggested by Mugenda was used in sampling frame to identify 400 members as the representative sample. The DCO and at least one leader in each cooperative were engaged in data collection purposively. Data collection was carried out using semi-structured questionnaire and unstructured interview schedule for DCO. Data analysis was mainly descriptive in nature. Descriptive statistics formed the main basis of data analysis and presentation to enable easy interpretation. The study indicated that membership size influence the performance of cooperatives and Membership size is therefore a substantial consideration for cooperative development. Large membership size is desirable for continuity of cooperatives; however policy framework should be put in place to guide the limits on cooperative membership which may be expected to yield relatively higher returns. Education level and training of cooperative leaders influence cooperative performance. Cooperative leaders should be well educated as indicated by 381 respondents (97.2%).Members level of income influence performance of cooperatives. Reliable income influences continuity of cooperative, contribution ability, leads to higher resource base and member participation in activities of cooperatives. The study indicated that source of income influences the performance of cooperative as shown by 242 respondents (61.7%). Therefore, a reliable level of income for members leads to improved support for the activities of cooperatives. Cooperative management should be geared towards achieving members’ expectations and goals. Cooperative members should be involved in election of their leaders since the results indicate that successful cooperatives have higher extent of achieving set objectives, high level of member participation and higher management capacity. It was recommended that membership size, education level and training, level of income and quality of management be considered as vital factors to improve the performance of cooperatives.