North Karelian Cooperative Society is a significant tourism actor in North Karelia. It is owned by its customers and the inhabitants of the region.
North Karelian Cooperative Society is part of S Group which is a Finnish network of companies operating in the retail and service sectors. S Group consists of 20 independent regional cooperatives and 7 local ones. They are owned by their members.
The cooperatives offer services in the supermarket, department store and speciality store trade, service station and fuel sales trade, travel industry and hospitality business and hardware trade.
The regional cooperatives are independently responsible for their business operations. Their main objective is to serve the needs of co-op members: to provide them with competitive services and benefits in a profitable manner. Both financial profitability and social responsibility are emphasised in the co-op activities. Their principles include: open membership, democracy, equality and purchase rewards for members, as well as the distribution of surplus.
The North Karelian Cooperative Society is the largest tourism actor in the region and it owns hotels in Joensuu, Koli national park and Nurmes and runs a downhill ski resort and spa in Koli. In 2016, the cooperative bought Bomba resort (hotel, spa & Karelian village) which was once a very successful tourism destination but over the years its appeal had faded and it needed new investments. By buying the resort and renovating it, the regional cooperative was able to secure tourism activities in the destination and also attract new visitors to the area and, thus, benefit local economy.
Each co-op member has invested an equal amount of equity in their cooperative, as a membership fee. All regional cooperatives have a Managing Director, who is responsible for managing its operations in accordance with laws and regulations issued by its administrative bodies.
Evidence of success
The North Karelian Cooperative Society (NKCS) has currently over 80 000 members/owners, i.e. around 83% of the households in the region are part of the cooperative. NKCS invested around 6 M euros in the Bomba resort. After the renovations the number of visitors in the resort and the Pielinen Karelia area increased notably. In January-March 2018, the number of visitors in the area grew by 17 % when compared to the same period in 2016 i.e. prior to the investments in Bomba.
Potential for learning or transfer
Some destinations could use the cooperative and its management structure as an example when building their own destination management systems. The cooperative model emphasises the role of owners/inhabitants in decision-making and development activities. In the regional cooperatives all decisions are made by the owners and business profits are invested in the development of service offering which will benefit all co-op members and other residents in the area.
Tourist destinations suffering from a lack of private investment could build cooperatives owned by the customers and inhabitants to run business and improve their tourist offer.
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