Definition of Patron
A patron is generally defined as an individual who regularly visits or supports a business. This term is most commonly used to describe customers or clients who consistently use the services of a particular business or organization. In the context of taxation, a patron refers to someone who engages in business with a cooperative but does not hold membership in it.
Examples
Business Context
- Retail Customer: An individual who frequently shops at the same grocery store can be considered a patron of that store.
- Restaurant Regular: A diner who routinely eats at a specific restaurant is a patron of that establishment.
Taxation Context
- Cooperative Customer: A farmer who purchases supplies from a local agricultural cooperative but is not a member of the cooperative.
- Energy Consumer: An individual who uses electricity from a cooperative energy company but does not hold a membership in the cooperative.
Frequently Asked Questions (FAQ)
What is a patron in business terms?
A patron is a customer or client who regularly uses the services of a particular business or organization.
What does it mean to be a patron of a cooperative in terms of taxation?
In taxation, a patron of a cooperative refers to someone who does business with the cooperative but is not necessarily a member.
How does patronage work in cooperatives?
Patronage in cooperatives often involves patrons buying products or services from the cooperative. Even if they are not members, patrons may receive certain benefits or part of the cooperative’s profits distributed based on their usage.
Can a patron become a member of a cooperative?
Yes, patrons can choose to become members of a cooperative if they meet the cooperative’s membership criteria and fulfill any associated requirements.
Is there a difference between a patron and a customer?
The terms are often used interchangeably, but “patron” can imply regular or habitual business, whereas “customer” is a more general term.
Related Terms
Cooperative (Co-op)
A cooperative is an organization that is owned and operated by its members, who share the benefits generated by the business. Unlike traditional businesses, cooperatives are typically driven by the interests of their members and can span various industries, including agriculture, retail, and utilities.
Membership
Membership refers to the status of being a part of a specific group or organization. In cooperatives, members often have voting rights and a share in the company’s profits based on their involvement and usage.
Patronage Dividend
A patronage dividend is a distribution of profits by a cooperative to its patrons based on the amount of business the patron did with the cooperative during a specific time period.
Online Resources
- National Cooperative Business Association
- International Cooperative Alliance
- Internal Revenue Service (IRS) on Cooperatives
Suggested Books for Further Studies
- Understanding a New Co-operative Law Framework: A Source Book by Various Authors
- The Cooperative Business Movement, 1950 to the Present by Patrizia Battilani and Harm G. Schröter
- Co-operation, Values and the Democratic Ideal: Business for the Twenty-First Century by John R. Whitman and Dave Whitman
Fundamentals of Patron: Business and Taxation Basics Quiz
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