Co-ops: Billion Dollar Company In The Making

(This article is taken here)

IT is just two years old, and with only 89 members, it is possibly the smallest cooperative in the country.

But Koperasi Pusat Pembangunan Kemahiran Sara-wak (Koperasi PPKS), which was registered in 2006, is the country's second best-performing co-operative.

Its chairman, Albar Abdul Rahman, said yesterday: "We have always adopted a wise and prudent management. That is the key to our success."
(If all the GLC company in Malaysia practise this in their business, then our money would have been used for better use instead of letting the goverment using it to bail out the ailing companies)

To be voted the second best-performing cooperative nationally surprised Albar, though.

But recognition for the success of Koperasi PPKS or Sarawak Skills Development Centre Cooperative, in Ta-buan Jaya, is overdue.
In its first year and with a working capital of RM4,050, it registered a net profit of RM167,800. The next year, its profits jumped 297.9 per cent to RM499,896.
(WOW!!! This much of percentage profit earned can easily put Warren Buffett, Benjamin Graham, George Soros, Merilyn Lynch and other investment gurus to shame!!)

At its annual general meeting two months ago, the cooperative passed a resolution to pay out a dividend of 200 per cent.

Albar said: "The cooperative's performance was outstanding . We did fantastically in our first year and the dividend paid out was 100 percent.

"Last year, we more than doubled our profit and it is just fair that the dividend was also doubled."

The cooperative runs a cafeteria, cleaning and janitorial services, a photocopying centre and a mini market.
(Hmm...These businesses are worth to be considered eh?)

In Kota Baru, distributing small change to businesses and buying and selling gold jewellery under the Islamic pawn-broking concept of Ar-Rahn have earned Koperasi Permodalan Kelantan good profits in recent years.

Touted as one of the successful cooperative stories in the country, it is also making money from offering insurance coverage to telecommunication companies on their telecommunication towers.

The cooperative's secretary, Ramilan Abdul Rahman, said: "We owe our success mostly to Permodalan Kelantan Bhd, which leases us our pawn-broking licences and rents the five buildings we own."

The cooperative made headlines recently following reports that it was paying dividends of 175 per cent to members, but that wasn't its highest payout.

Just a few years after the cooperative was formed in 1998, it paid out a dividend of 300 per cent.

However, Ramilan said the high dividend did not mean the members received a big windfall because of the low initial deposit.

"When we paid out 300 per cent, the share capital of members was only RM100, which means they each got RM300.

"This time, although the share capital has been increased to RM200, they are only getting RM350 each."

The co-op has 190 members.

"Forty per cent of our income comes from the pawn-broking licences and 20 per cent from the rental of buildings.

"The rest is from insurance and loans to members."

(Loan to members eh? Ah Loong is it? No wonder so high profit larr!!)
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Judging at this exponential growth, these co-ops will turn into a multi-million company in a few years away! I would say by the next decade, we would have our very first billion-dollar co-op. I will not be suprised to see if any of the member making it to the list of top 100 richest man in Asia, or even the world.

In short, running a cafeteria, cleaning and janitorial services, a photocopying centre and a mini market, insurance services, pawn-broker and being an Ah Loong would be the shortest way to become a filthy rich man. Anyone care to chip in?