Achieve New High Records 

 In Organized Buying 



(Continued from page 5) 



850.24. Of this amount $316,560.18 is in- 

 vested in United States securities, the 

 balance used for operating capital. Bro- 

 kerage income for the year was |186,- 

 277.64 — a gain of 25.55 per cent. The 

 net income totaled $219,159.54. A totel 

 of $180,000 will be distributed to mem- 

 ber companies on a patronage basis for 

 paying taxes and dividends on preferred 

 stock. 



An analysis of the company's audit 

 over a p«riod of years discloses that this 

 co-operative enterprise has had a marked 

 influance in reducing the margins taken 

 by privately-owned companies. Competi- 

 tioa is getting keener. The buying and 

 selling spread is narrower. And this 

 sitmation is showing up in the funds 

 available for patronage dividends to 

 member patrons in many counties this 

 year. 



It's the old story again of the co- 

 operative enterprise forcing privately- 

 controlled companies to deal with farm- 

 ers on a mora favorable basis to the 

 prodBear. Thus, the outsider, the non- 

 mefitber who contributes nothing toward 

 the support of the enterprise benefits by 

 the efforts of his organized neighbors. 



la addressing: the annual meeting 

 President Fred E. Hemdon paid a glow- 

 ing tribute to organized effort as the 

 greatest force in the success of the com- 

 pany. "Our company is now the largest 

 and best of its kind in the world," he 

 said. "There are many reasons or con- 

 tributing factors to this success, but 

 after three years of study and observa- 

 tion, I am of the firm belief that the 

 greatest influence, the one that over- 

 shadows all others, is that we are not 

 only closely related to, but a part of the 

 best general farm organization in the 

 world — the Farm Bureau and Illinois 

 Agricultural Association. As they live 

 so will we live; as they go we will go. 

 Surely it behooves us to honor our par- 

 ent organization that our days may be 

 long upon the land." 



Mr. Herndon warned against piling 

 up heavy accounts receivable. "I some- 

 times wonder," he said, "if there is a 

 trend toward borrowing money to use as 

 working capital or for expansion when 

 there should be more thought and effort 

 to collections." He expressed some con- 

 cern over the great expansion of com- 

 pany-owned filling stations which will 

 greatly increase the fixed assets, but 

 actually yield a low net income. "We 

 have the Illinois Farm Supply Com- 

 pany," he said, "because there is a need 

 fop it. With the advent of motor trans- 

 portation and power farming, the quality 

 of lubricating oils, fuels and greases be- 



M. E. Newmlster, Cooksville, Service Com- 

 pany salesman, is a real asset in fhe member- 

 ship acquisition program !n McLean county, says 

 A. B. Culp, organization director. He signed 

 18 new members in 1935. 



ing sold to farm people, also the wide 

 spread in cost of distribution caused 

 Farm Bureau members to demand an 

 organization such as we have today." 



President Earl C. ■ Smith and Donald 

 Kirkpatrick of the corporate managerial 

 board, presented several policy recom- 

 mendations which are incorporated in 

 resolutions later adopted by the dele- 

 gates. One has reference to capital re- 

 quirements and relationship of fixed as- 

 sets to outstanding capital stock and net 

 worth. It is designed to steer county 

 companies away from excessive borrow- 

 ing and excessive investment in fixed 

 assets such as retail service stations. 



The other outlines a plan governing 

 sales by county companies to farmers 

 residing in borderline or fringe territory. 

 The recommendation is that when a 

 county company serves members beyond 

 the county line with the consent of the 

 Farm Bureau and Service Company in 

 the adjoining county, that any patronage 

 dividends declared for such members 

 served, be paid over to the County Serv- 

 ice Company in the county where the 

 borderline patrons served reside and that 

 the Farm Bureau member patron so 

 served be paid the dividend declared by 

 the Company in the county in which he 

 resides. 



The fact that some county companies 

 pay higher patronage dividends than 

 others has created a troublesome prob- 

 lem among borderline residents who tend 

 to patronize the company in the ad- 

 joining county which pays a higher cash 

 dividend. 



Clifford V. Gregory, editor of Prairie 

 Farmer, gave the principal address at 

 the meeting in Peoria attended by some 

 700 or more delegates and members from 

 the 60 county companies. He praised 

 the achievements of the State Company 



and the affiliated county companies in 

 setting a high standard of quality for 

 products handled, and in savings, but 

 warned that not too much emphasis 

 should be placed on th« payment of divi- 

 dends. The time may come, he said, 

 when patronage dividends may be re- 

 duced due to increased competition. 



The success of the Company in pi- 

 oneering the "use of a farm product — 

 soybean oil in paint — he said, had great 

 implications and indicated how such a 

 co-operative could be of outstanding 

 service in developing new industrial uses 

 and markets for farm products. 



A greater opportunity, he said, lies 

 ahead of farmers in reducing the spread 

 in the sale and distribution of farm 

 products. After all, the price the farmer 

 sets for what he raises overshadows any 

 savings in buying supplies, and more 

 attention should be given toward co-op- 

 erative marketing and distribution that 

 the farmer may get a fair price and the 

 consumer may buy food at a price nearer 

 to that received by the farmer. 



D. W. Hardy, manager of the St. Louis 

 Bank for Co-operatives which has as- 

 sisted in financing a number of county 

 companies discussed pertinent questions 

 involved in federal loans to co-operative 

 enterprises. 



An interesting skit was presented by 

 the sales force led by Walter Peterson 

 and Chet Becker of the State Company 

 following the meeting. Leaders of the 

 four divisions: Egyptian. Rough Riders, 

 Norsemen and Illini, dressed as football 

 players threw silver colored footballs to 

 the various company managers symbolic 

 of the quotas accepted by each in the 

 1935-'36 future motor oil sales contest. 

 County managers and leading truck 

 salesmen were honored during the 

 meeting. 



Three changes were made in the Board 

 of Directors: C. H. Buzzard of Altamont 

 succeeds Harry Ebbert of Montrose, J. 

 B. Redman of Cairo succeeds G. W. Clark 

 of Golconda, Jesse L. Berry of Cerro 

 Gordo was elected in place of the late 

 .1. M. Eyman of Warrensburg. 



Re-elected were Mr. Hemdon; L. A. 

 Abbott, Morrison; H. A. Keele, Chester- 

 field; Frank J. Flynn, Murrayville; Thos. 

 J. Penman, Yorkville; E. E. Stevenson, 

 .Streator. 



The U. S. District Court at Peoria. 



Illinois, recently held the amended 

 F'razier-Lemke farm mortgage mora- 

 torium law unconstitutional. The deci- 

 sion was handed down by Judges Charles 

 P. Briggle and J. Earl Major. 



The Organization Department reports 



that 13,291 new Farm Bureau members 

 were signed between Jan. 1, and Oct. 10, 

 1935. 



n 



I. A. A. RECORD 



