Orbit Connected
CO-OP
About a GPS Cooperative Model
"Low Risk < High Reward"
CONCEPT
The idea behind a cooperative focused on GPS products is members working together to solve common problems and seize exciting opportunities. In the case of a specific GPS co-op, it is to take advantage through the bundling of hardware, software and sims so that member clients in the group have more control over pricing, their customer base and the data associated with their customers. The model also frees members to design programs for their customer base, based on specific needs.
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The model is designed so that one of the cooperative's functions will be to act in the capacity of a group specific distributor as many hardware manufacturers won't sell to dealerships direct.
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The function is quite basic. The group co-op purchases and resells the product to the member clients on a cost plus basis. The small mark-up goes to help with administration and support for the co-op to continue its operation.
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Revenue will be generated by the co-op in several ways which include hardware sales, service and consumer software usage for each of the member clients customer base. Since the co-op is owned by the members, profits less member agreed to administrative fees will be returned to the client members based on their participation. What ever markup the client member sell their product and service for also stays in the clients wallet, not the co-op. For example, if the co-op cost to the client for all the services was $100 and the dealership sold the product to their customer for $600, the dealership keeps the $500 margin. If at the end of a given period of time agreed to in the by-laws, the co-op only used $90, of the $100, the balance of $10 would be distributed to the dealerships times their participation.
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ALWAYS REMEMBER:
Data is now a big part of the life blood that fuels our economy. In this model, the co-op (thus the participating member clients) now control the data as they are the owners of the co-op.