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In recent years three important trends have become apparent among grain marketing and farm supply cooperatives. These farmer owned firms have been rapidly investing in infrastructure, reformulating profit distribution and equity strategies, and have pursued consolidation with other cooperatives. This manuscript explores the factors contributing to those trends, the implications for cooperatives leaders, and the impacts on farmer members. Abstract: In recent years three important trends have become apparent among grain marketing and farm supply cooperatives. These farmer owned firms have been rapidly investing in infrastructure, reformulating profit distribution and equity strategies, and have pursued consolidation with other cooperatives. This manuscript explores the factors contributing to those trends, the implications for cooperatives leaders, and the impacts on farmer members.

Predicted shortages of chief executives combined with growing economic and social significance of the nonprofit sector in an increasingly complex operating environment highlight the need for executive succession planning. Accordingly, our research explores factors that may influence executive succession planning in nonprofit and cooperative forms of organizations. Survey data (N = 242) were analyzed using multiple regression analysis. Results suggest both barriers to and substitutes for executive succession planning that help explain the apparent dearth of succession planning efforts in these organizations. A penchant for continuity was found to be a barrier to such planning, while elements of governance quality and internal development were found to substitute for executive succession planning.

Purpose Community banks were affected distinctly by changes in banking regulation in the 1990s when compared with large commercial banks. These banks offer non-traditional finance items, presumably to compete with these financial institutions. This study aims to examine the importance of accounting for off-balance sheet (OBS) items when estimating the financial performance of community banks. Design/methodology/approach This study applies a two-stage analysis pathway that initially calculates X-efficiency scores as part of the overall cost structure and then deploys data envelopment analysis bootstrapping method for a second-stage ordinary least square model. Findings Study findings indicate that failure to include OBS items in the X-efficiency calculation for community banks understates the efficiency performance of these banks. Furthermore, results indicate that factors internal and external to the community bank affect X-efficiency. Increases in OBS items are associated with growth in assets and growth in net non-interest income. Therefore, OBS items become an attractive alternative source of income and a mechanism for expanding output with the same volume of inputs. In addition, OBS items allow the largest community banks to deleverage their balance sheet, whereas the smallest community banks still emphasize on traditional lending products and benefit from existing equity. Also, larger banks may be using OBS items as a mechanism to isolate their performance from macroeconomic fluctuations. Research limitations/implications Research limitations include a reduced number of community banks as consolidation accelerates partly because of compliance concerns. Practical implications The approach used supports a series of community bank managerial approaches that may be adopted by management. Originality/value The results of this study show several reasons why community banks may have managerial incentives to include OBS items. As observed by Gilbert et al. (2013), community banks are adjusting their product line so as to operate efficiently. Community banks must provide a product line which provides margin and meets customer needs at a profit to the firm. OBS items allow existing staff to provide funds without additional equity requirements from the balance sheets. The increase in OBS activities may signal the perception that the associated interest income is less risky and less costly than other alternatives, including adopting technologies to diversify traditional loan product offerings. As community banks tend to have lower default rates than their larger counterparts, the most likely explanation is that the OBS interest risk is more attractive than compliance or development of mechanisms to offer a broader suite of traditional loan products.

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Reductions in strawberry yields were observed in association with infestations of the greenhouse whitefly, Trialeurodes vaporariorum (Westwood). The magnitude of yield impact is estimated using data from a field experiment evaluating nine management approaches for the greenhouse whitefly on strawberries, var. Camarosa. A range of effectiveness and yields was found. Imidacloprid (Admire) applied at transplanting was found to provide the greatest effect on adult whitefly densities. Pyriproxyfen (Esteem) had no immediate effect on adult density but reduced nymphal densities over time. Pairing the use of these products at transplant (Admire) and early spring (Esteem) provided the greatest reduction in whitefly density observed relative to an untreated control. Reductions in strawberry yields were found to increase as whitefly densities grow or as populations persist over time. For example, the estimates from our analysis suggest that at 20 weeks after planting, an average whitefly population may reduce average weekly yields in an untreated field by ≈80 g/plant.

PurposeThis paper presents a model for determining the optimal capital structure for cooperatives and explores the relationship between financial leverage and the ability of cooperatives to retire member equity.Design/methodology/approachA model is developed to determine the optimal capital structure and explore the relationship between capital structure and the rate at which a cooperative can retire member equity. Using data from cooperative financial statements, ordinary least-squares regressions are conducted to test two hypotheses on capital structure and equity retirement.FindingsThe model shows that the optimal capital structure is determined by the ratio of the rate of return on capital employed to the interest rate on borrowed capital and the required level of interest coverage. The regressions suggest that cooperatives choose their capital structure largely according to the rate of return on capital employed and the interest rate in a manner consistent with maximizing the rate of return on equity and that the rate at which cooperatives can retire member equity is directly related to leverage.Research limitations/implicationsThe model does not consider unallocated earnings. Analysis of the relationship between leverage and equity retirement yields results contrary to the assumptions of earlier studies.Practical implicationsCooperatives can use the model because the necessary parameters are easily understood and readily available from financial statements, lenders and industry sources.Originality/valueThe model is developed specifically for determining the capital structure of cooperatives and differs substantially from the corporate model. A theoretical basis is provided for the relationship between leverage and equity retirement.

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