Page 6 



BETTER FRUIT 



Mav 



and each will continue as part of the 

 distributing system as long as he con- 

 tinues to perform the service in this 

 way. ^^^lerever a better link can be 

 forged then a part of the present chain 

 will drop out, whether it relates to a 

 service performed by the producer, the 

 jobber or by the retailer. 



A Study in Distribution by the Citrus 

 Fruit Industry 

 The California citrus industry has 

 been studying its own distributing 

 problem, because the production of 

 oranges and lemons is increasing much 

 more rapidly than the population. The 

 Valencia shipments, which now equal 

 12,000 carloads, will double in a few 

 years. The lemon shipments of 8,500 

 carloads will more than double in the 

 near future and California will supply 

 more lemons than the present total 

 consumption of Canada and the United 

 States, including imports. There are 

 more than 40,000 acres of Washington 

 navel oranges four years old or under, 

 which will soon come into bearing, and 

 will materially increase the navel ship- 

 ments. The problem of the California 

 citrus industry is first to develop a 

 product of quality, then to create a 

 larger consumer demand, and finally to 

 adjust its distributing operations to the 

 jobber and the retailer so that the 

 supply may be uniform and the con- 

 sumer demand can be efTiciently filled 

 and promoted by the producer, the job- 

 ber and the retailer working together. 

 Looked at from its broadest aspect, the 

 problems of the producer, the jobber 

 and the retailer are intimately con- 

 nected, and are all of the same charac- 

 ter — a problem of edicient, economical 

 distribution to fill a larger demand 

 which must be developed on the part 

 of the consumer. There can be no 

 fundamental antagonism between the 

 citrus fruit i)roducer, the jobber and 

 retailer if they understand each other's 

 problems. 



The Details of the Investigation 



The investigation of the cost of dis- 

 tributing the citrus fruit crop has ex- 

 tended over two years in the principal 

 cities of the I'nited .States and Canada. 

 It has been made through the co-opera- 

 tion of the jobbers and retailers, with 

 agents of the industry located in these 

 places. Recently the investigation has 

 been extended to the rural districts, 

 where one-half of the population re- 

 sides. The method of the investigation 

 follows: Beginning in .lanuary, 1914, 

 the agents, starting with the delivered 

 price to the jobbers of oranges varying 

 in size form 80s to 360s, and lemons 

 varying from 270s to 420s, of all grades, 

 determined the price which the lead- 

 ing jobbers in each place charged the 

 retailers for these sizes and grades, and 



A Manager Wanted 



I require a manager for my 100-acre orchard (3 years 

 old), within 15 miles of the city of Melbourne. Austra- 

 lia, population 6UO.0O0. (Good roads.) I need a com- 

 petent man to take full charge as I am in business in 

 the city. Therefore, any applicant must have a 

 thorough knowledge of the fruit industry and give 

 excellent references. Address S. Stott. "Viewbank," 

 Burke Road, East Malvern. -Victoria, Australia. 



then determined the price which the 

 retailer charged the consumer. The 

 data have been accumulated on all sizes 

 and grades for two years, and 12,000 

 price reports have been brought to- 

 gether in this way. Supplemental to 

 this general investigation a large 

 amount of information has been fur- 

 ni.shed by jobbers and retailers who 

 have given the records of their dis- 

 tributing costs from their books. 



In this report, representative periods 

 in 1014 and 1915 are selected to show 

 the factors that enter into the con- 

 sumer's price when a dollar's worth of 

 oranges are purchased from the retail 

 dealer. 



The Consumer's Dollar, 1914 



From .\pril 15, 1914, to December 1, 

 1914, twenty-eight representative cities 

 are selected, including 3,265 jobbing 

 and retail prices. This period covered 

 low prices on both Navels and Valen- 

 cias. The average price paid by the 

 consumer was approximately 37% 

 cents per dozen for all sizes of the 

 grades included in the reports. The 

 factors entering into the consumer's 

 dollar under these conditions are 

 shown in the chart and table fol- 

 lowing: 



The Consumer's Dollar, Oranges, 

 April 1.5 to December 1, 1914 



The Consumer's Dollar, Oranges, 

 April 1.5 to December 1, 191.5 



Per Box 



Fruit on tree !tl.2896 27.7% 



Harvesting 1058 2.3% 



Packing 3246 7.0% 



Selling 0060 1.4% 



F.O.B. California -91.786 38.4% 



Freight and refrigeration 954 20.5% 



Delivered price !52.74 58.9% 



Jobber's margin (gross) 42 9.0% 



Jobber's price ifS.lG 67.9% 



Retailer's margin (gross) 1.49 32.1% 



Consumer pays .94.65 100.0% 



The Consumer's Dollar, Oranges, 1915 



The period from April 15, 1915, to 

 December 1, 1915, includes 34 cities 

 and 4,138 jobbing and retail prices. 

 This period represents a higher price 

 for the fruit of both Navels and 

 Valencias, the consumer paying an 

 average of 43V-' cents per dozen for the 

 oranges of the grades included. 



The factors entering into the con- 

 sumer's dollar under these conditions 

 are shown in the chart and table fol- 

 lowing: 



Per Box 



Fruit on tree -92.1896 40.3% 



Harvesting 1058 1.9% 



Packing 3246 6.0% 



Selling 0660 1.2% 



F.O.B. California -52.686 



l-'reight and refrigeration 954 17.6% 



Delivered price !?3.64 



Jobber's margin 44 8.1% 



Jobber's price $4.08 



Retailer's margin 1.35 24.9% 



Consumer pays $5.43 



The Retail Distributing Cost 



The retail distribution of the citrus 

 fruit crop to 100,000,000 con.sumers is 

 naturally the most costly, because it 

 represents a service to a vast numbei' 

 of unorganized people, performed by a 

 vast number of factors, the smaller of 

 which are almost equally unorganized. 

 It has been shown by Mr. C. C. Parlin, 

 Chief of the Research Laboratory of 

 the Curtis Publishing Company, that 

 the average cost of doing the retail food 

 business of the United States is 17% 

 on the selling price, while the average 

 net profit is 3vr, making a gross cost of 

 20%. The figures developed in the re- 

 tail citrus investigation show a gross 

 profit of 32.1% on the low selling price 

 in 1914, and 24.9%' on the higher selling 

 price in 1915. 



The cost of handling a perishable 

 fruit that is subject to decay and deteri- 

 oration, is naturally higher than the 

 cost of handling semi-perishable and 

 non-perishable food products. The 

 excess cost which is inflicted on the 

 retailer from decay depends primarily 

 on the care with which the fruit is 

 handled by the grower in preparing it 

 for shipment and on the rapidity of his 

 stock turn-overs. It is well known that 

 the fruit business, along with many 

 other products, returns a relatively 

 hi.gh profit to the retail dealers because 

 half or more of the value of the goods 

 sold through the store, including sugar, 

 flour, sometimes butter and other 

 articles, are often handled without 

 profit and sometimes below the cost of 

 handling. This condition infiicts on 

 the consumer a somewhat higher price 

 on fruits and vegetables because the 

 retailer's ii,et profit must be made on 

 one-half the goods passing through his 

 store. 



