Community Supported Economy
Consumers and producers taking matters into their own hands
Why do we need a community supported economy?
In the classic business model, the only direct contact (if any) that occurs between producers/service providers and consumers occurs at the moment a product or service is purchased. In “community supported” businesses, the two groups meet repeatedly at the same table. Together, they set the standards by which the goods and services they exchange are produced and provided. Together, they define what such things as fair wages and environmentally friendly production methods mean in the specific business and social context where they live and work. Together they agree upon how the resources (financial or otherwise) available to them can be most fairly distributed among and contributed by members of their community. The risks and responsibilities of goods and service provision are more fairly distributed, as are the benefits. The increased financial security enjoyed by producers and service providers, and the active participation of consumers in decision making creates a space where all parties develop greater respect, understanding and tolerance for one another’s individual needs and challenges.
Where did this idea originate?
From Community Supported Agriculture (CSA) to Community Supported Everything Else (CSX)
Community Supported Agriculture (CSA) is an arrangement where food consumers share the costs of agricultural production as well as the resulting harvest. A group of individuals comes together to form a community whose members combine their resources to cover the running costs of a farm operation. This changes the relationship between consumers and farmers, in that the relatively high risk of agricultural production lies not on the farmer alone, but also on those who consume the food produced. Together consumers and farmers develop and maintain an organizational structure that allows them all to weather the (literal and figurative) storms that make farming such a risky venture. Farm products are no longer sold for a price that is determined in an anonymous and, often volatile, market. Instead, consumers finance production on the farm, and thus shelter it and themselves from the volatility and anonymity of the market.
This principle is transferable to other goods and services, such as health and wellness, construction and repair services, restaurants and catering, music and other creative arts, and even recreation and tourism.
Community Supported Agriculture (CSA), thus becomes Community Supported “X”, or CSX.
An economy without prices: socially and environmentally conscious
The failure of the current, highly globalized economic system to provide solutions to accelerating climate change and growing economic and social inequalities demonstrates the need for more autonomous, regionally oriented supply systems. CSX provides a framework for consumers, producers and service providers to cooperatively organize these systems. Instead of paying prices for goods and services that are determined by the market, consumers supply the resources needed to run a business operation for an entire year. In exchange for their contributions, consumers receive goods and services in a quality and amount that is based both on their individual needs and on the actual production capacity of their own community-managed business. In this way, the available resources and the true needs of the group can be collectively discussed, and the ecological and social values of all involved can be included in production planning at the outset.
Prosuming instead of consuming
The innovative aspect of CSX is that it blurs the line between producers and consumers: Business decisions are made collectively, and many processes and associated expenses that usually are the sole responsibility of producers are provided in-kind or financed by the community of consumers. Members of the CSX community cease to be merely consumers, and instead become prosumers. Prosumers actively co-create production and provision structures that reflect their own social and ecological value systems. Thus, instead of placing their trust in brands and certification systems controlled by third parties, prosumers build trust collectively through participation in the group and its self-determined and guide group processes.
This shift in the boundaries between the roles of producer and consumer is reflected in the cooperative relationships and organizational structures that result. An appropriately-sized organization is key to creating and maintaining successful cooperative structures.
What is CSX?
Prosumers collectively finance the ongoing costs of “doing business”
The core of CSX is the incorporation of prosumers as active participants in running the business, combined with the collective financing of the yearly operating costs. Based on the budget for each new business year, members of the cooperative community formally commit in advance to contribute a share of the costs based on the following six principles …
The provision of products and services is organized and carried out locally (as close as possible, and only as far away as necessary). Cooperation requires interaction between producers/service providers and the community, as well as between individual community members themselves. Community meetings and events are organized to support this continual interaction.
The yearly operating budget, as well as decisions regarding production standards and the material and human resources used in production are openly communicated to the community.
Community contributions instead of prices
Community members make regular contributions (financial and/or in-kind) to cover the running costs of the operation for a set time period (usually one year). During this time, all CSX prosumers are entitled to receive an equal share of the products and services produced or provided. Individual contributions may vary based on the principle of solidarity (see solidarity-based financing), allowing members with fewer resources to participate.
The budget on which individual contributions are based covers the complete costs of running the business. While no ‘profit’ is planned into the budget, savings and investments for future business investments or unforeseen expenses can potentially be included.
Prosumers commit to make regular contributions over an agreed upon time period at a rate determined prior to that period.
Shared risk and responsibility
By committing in advance to finance the budget for the agreed upon time period, prosumers each carry a share of the risk that the amount of goods and services that can be provided is less than anticipated. If, however, amounts in excess of predictions are available, each member also shares in the bounty.
In addition to the six principles listed above, some CSX operations have additional criteria that govern their operations.
Individual CSX members contribute different amounts based on the resources available to them. In some cases, the level of individual financial contributions is decided in a bidding round.
Participatory decision making
CSX community members use participatory decision-making to collectively determine the type and amount of products/services that will be produced/provided, as well as the production and distribution methods used.
CSX members are directly involved in production, business management and development, either as volunteers, or as a requirement for community membership.
Some or all of the business and/or its physical property is owned by the community as a whole.
The core principles of CSX businesses provided here are derived from analysis of existing CSA operations in Germany. As new businesses based on these principles continue to form in other sectors, the diversity of forms and structures will increase.
For this reason, defining CSX will be a continuous open, dynamic and (naturally!) community supported process.