MARKETING 133 



selling to the elevator, the farmers would not sell 

 by direct shipment, the company was thus given 

 a virtual buying monopoly. The elevator, once 

 established in the community, became a public 

 service necessity. Monopoly of ownership often 

 resulted in the charging of excessive rates, - - in 

 other words, buying at too high margin. This, 

 of course, resulted in giving the producer a lower 

 price than that to which he was entitled. Indi- 

 viduals were unable to remedy this since they 

 could not compete with the powerful organizations. 

 Many companies never abused their advantages 

 and were content with the profits resulting from 

 good business management. The abuses of some, 

 however, placed nearly all of them under suspicion. 

 Out of this condition grew the organization by 

 farmers of local companies which built so-called 

 ' farmers' elevators." Since the strength of the 

 concern lay in its membership, shares of stock 

 were sold to as many farmers in a community as 

 possible. The business of the local companies 

 was placed in charge of a board of directors who 

 hired a man experienced in grain dealing as man- 

 ager. To him was intrusted the working out of 

 details subject to the approval of the directors. 

 Each subscriber pledged himself, if prices were 

 equal, to sell to his own elevator. If the line 

 elevator paid higher prices than the farmers' 

 elevator he would sell there ; in such case he 



