in turn label the cans with their own "privcite" brand names. Large 

 chain stores have private labels and also sell national name brand 

 products. Other small packers may use Uieir ovjn "brand" name on a 

 private labels selling the majority of their pack in certain locali- 

 tieso These brands are sold by anyone who wishes to handle them 

 within a limited area. 



The canned pack is distributed in various ways usually determin- 

 ed by the size of the processing firm. The large firms hold a certain 

 percentage of their current inventories directly adjacent to their 

 plants with the balance of the inventories being warehoused at various 

 distribution centers tliroughout the nation. Smaller packers ordi- 

 narily retain the majority of their canned tuna in warehouses located 

 at the plant site. So far as it can be ascertained^ the processing 

 firms do not own or control warehouses in any of the cities of the 

 country where distribution is made. 



The level of inventories at the various centers of distribution 

 are based on projected sales figures or anticipated turnover. The 

 storage charges associated with tuna stored for the account of the 

 processor at the different distribution points are absorbed by the 

 processor. The necessity to keep canned tuna available in rather 

 large quantities at points other than plant site has developed, in 

 part, from the increasing growth of chain stores and super market type 

 distribution. These kinds of retail outlets operate on volume turnover 

 accompanied by a short time interval between purchase and resale. 

 Large orders are placed and expected to be filled raomentailly. Brokers 

 must be able to guarantee immediate delivery or buyers turn to a source 

 that can meet their needs. The competitive marketing conditions of the 

 canned tuna industry have forced the processors to accept the burden of 

 the cost of maintaining this immediate source cf supply. 



Prices charged by processors are F.O.B. shipping point which is 

 usually the cannery. Transportation charges are paid by the canners 

 who are compensated by adding freight costs to invjices sent the buyers. 

 Tuna canning requires a large cash outlay for purcnase of raw fish and 

 processing with no return being realized until after the pack is sold 

 and in the hands of the buyer. Tliis process may take from 2 to 3 months 

 or more. The seasonality of the raw fish supply requires that inven- 

 tories be held for extended lengths of time through periods of light 

 fish deliveries if the processor intends to stabilize a year-round market 

 for his brand. These marketing conditions give rise to various problems 

 of finance, 



389 



