Collective Business System - Overview

Overview

Beginning in the middle of the twentieth century, the business world in the United States of America and many European countries has witnessed the consolidation of all types of businesses through mergers, rollups or acquisitions. Typically, by the end of the consolidation process, a particular industry or profession becomes dominated by three or four nationally based enterprises. Under these circumstances many smaller companies (often serving only local requirements and in private ownership) are often forced out of business or decide to sell to one of the dominant entities because it can no longer compete profitably with them. Typically, locally based businesses are unable to compete because they lack the capital, global marketing capabilities, purchasing power and expensive technology necessary to operate efficiently. This trend toward consolidation is expected to continue well into the twenty-first century and is sometimes shortened in developing countries, where the initial business in a market sector may be a single, large enterprise able to compete on the international market.

Presently, and for the foreseeable future, the inherent limitations of traditional collective business systems such as the trade organization, the cooperative and the franchise render them considerably less effective than they once were in advancing the business interests of their constituents. The following is a brief synopsis of those traditional collective business systems.