^finally, someone who cuts to the essence of the bike cooperative. What makes the entire concept work is the non-profit aspect. Depending on the the OP's tax laws (Australia, unfortunately), setting up one requires some planning, filling out of application forms (501 (c)(3) in the , U.S.), and of course, the requisite board of directors and financial accountability.
The benefit to users is accessibility of bicycles, parts and tools at nominal charge. The benefit to communities is the greater bond between local businesses, neighborhoods and residents. From what I've read, success is based on the to-the-death commitment of the board and volunteers to keep the doors open. For donors (like those on this forum), this is THE place to send unwanted bicycles, unused or like-new parts, and the like, to obtain the value as a tax deduction. I'm always culling through my inventory of items for what can be donated.
Co-ops rarely compete with bicycle shops because the potential clientele is stratified. Bike shops want people who are flush with money. Co-ops understand that they are serving those who are not. Each can serve those in between.