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How Patronage Works

As you may know, patronage is a big part of Rocky Mountain Supply and the co-op system; many people may need help understanding how we calculate the patronage dividends at the end of each fiscal year. Below is a breakdown of how members earn patronage and equity within the company and how we calculate those checks that everyone loves to receive!

  1. Become a Rocky Mountain Supply Co-op member. It’s free! 
  2. Make purchases at Rocky Mountain Supply. 
  3. We add up all purchases made in our fiscal year (which begins February 1st and ends January 31st each year) to calculate your patronage Dividend Check. 
  4. Patronage checks are mailed directly to your address we have on file. \

2024 RMS Rates of Return based on RMS Divisions.  

  1. Agronomy - Bulk Fertilizer, Seed, Chemical           4.8%    $32.50 per Ton of Fertilizer  
  2. Retail - Retail Fuel & In-Store Purchases               5.0%    18.4 ¢ per gallon of Gas
  3. Energy - Bulk Fuel & Wholesale Fuel                     5.0%   19.2 ¢ per gal of Diesel 
Patronage currently receives 40% Cash and 60% RMS Equity (aka stock). 

Rates will vary from year to year, depending on RMS’s profitability. 

RMS must be profitable to send out patronage checks. 

Patronage Calculation

Fertilizer            Bulk Fertilizer          Retail Fuel 

                                                         + In-Store Purchases  

$40,000             $20,000                  $5,000

x .048                 x .05                      x.05      Rate of Return 

______________________________________________________

$1,920               $1,000                    $250

 Total Patronage = $3,170

                            x.40

                           $1,268 Cash                         40% 

                           $1,902 RMS Equity / Stock    60%  

 The RMS Equity remains in your account in your name. Once you earn equity, you will have ownership of your local co-op. The equity is later retired and distributed to you based on the Equity Retirement Plan determined by the Rocky Mountain Supply Board of Directors.

If you have any questions regarding patronage, please give us a call and ask for CFO Terry Sweeney. (406)388-4009.