614 



THE AMERICAN BEE JOURNAL. 



Sept. 24, 1903. 



co-operation, and the question came up. How best to or- 

 ganize? In producing honey, I do not suppose there are 

 near the difficulties that there are in the orange business, 

 for this reason : All over Southern California we have dif- 

 ferent climates, different soils, and it does not make any 

 difference where you go, which one of these localities, that 

 was the one which was producing the best oranges that 

 could be grown. A man would say, " I am not going to 

 pool my fruit with any man down below Los Angeles, 

 where they produce dirty, cheap trash." Another said, " I 

 am not going to come in, for I have the finest fruit grown." 

 Another said, " We have no black scale, our fruit don't need 

 washing, don't need any cleaning." We found the best way 

 to do was to organize them into localities, let each locality 

 have its own organization, and let each organization be 

 composed of the growers. 



A great many organized on the basis of acreage, claim- 

 ing that a man who had 100 acres had more right to say 

 what the association should be than a man that had 10 

 acres. There were a number of the different local associa- 

 tions organized on the basis of acreage, and others on the 

 number of boxes produced ; it did not make much difference 

 how they organized, so that they got together and organized 

 and co-operated. The difficulties that came up were these : 



" Why, you have got nobody connected with your organi- 

 zation that knows anything about selling fruit." But we 

 did have men here who had business training, business 

 sense, and they got together and said to the orange growers 

 of Southern California, " We certainly have men who have 

 business ability, and being orange growers they certainly 

 can manage and run our business for us." 



A great many said, " It never will succeed, because we 

 did not go out and employ the so-called commission man, 

 who had for years run this business, and get them to run it. " 

 But we said, " No ; it was right that the orange growers 

 should be the men to manage their own business." 



We started with organizations in different places. 

 There were many sections that did not organize. Many 

 said we will just lay back and take advantage of these fel- 

 lows who are going to do so many wonderful things ; we 

 will sell our fruit, and let them hold theirs, and see who is 

 the loser. So, no completed organization was effected, and 

 we thought best to do this : Make an organization in each 

 locality ; let that organization look after the local part of 

 the work ; let it be composed of the growers that are 

 directly interested there. And that was done. 



Local organizations came together and incorporated, 

 and after they incorporated one said, " It is pretty hard to 

 transact business." So we found it best to have the local 

 organization responsible for the material which it bought, 

 and also responsible to its individual growers (members). 

 Then we found these organizations had to be bunched to- 

 gether in district exchanges. Each county was entitled to 

 one. Wherever there was a large enough acreage in the 

 county we allowed two or three in the county. A number 

 of these local exchanges said : " We must have a head to 

 us." Therefore they got together and selected one man 

 from each one of them, and they elected one member a 

 director in the Southern California Fruit Exchange. They 

 got together, that is, and elected one man to represent that 

 locality at the Exchange. Then the exchanges got together, 

 and from their number, the directors selecting one to the 

 Southern California Fruit Exchange. This was called the 

 head of the institution, and that was made up of six differ- 

 ent exchanges, comprising citrus fields from Taylor County 

 on the north as far as San Diego County on the south, in- 

 cluding Santa Barbara, Ventura, and all the different coun- 

 ties within that district. 



We adopted a method that had been in vogue among 

 the commission sellers, seeing that the only way to sell was 

 to sell in the manner in which they sold heretofore. We 

 followed them for a year, but found that it was not the 

 thing to do. We then sold our oranges on what was called 

 the f. o. b. plan, but we found that did not work success- 

 fully in the interests of the grower ; therefore we aban- 

 doned that, and adopted a new plan and called it selling the 

 fruit delivered. We ship our fruit, and have for some six 

 years under that plan. The plan is this : 



We get the local organization to say how many car-loads 

 of fruit, when the fruit is ready to go, and when they want 

 to ship it. The different localities vary in that, and we have 

 to work and protect as far as possible each locality. The 

 local association employs the labor that is necessary to put 

 the fruit on board the cars. They then turn around and 

 deliver the fruit to the local exchange, and the local ex- 

 change bills it to the Southern California Fruit Exchange, 

 and they employ an agent in the East, and they look after 



the general part of the selling. That makes the selling of 

 it no difficulty, if it is all under one head. We found that 

 the only way we could do, instead of hiring men in the East 

 that were directly interested in the sale, was to hire men 

 that were competent salesmen, pay them good salaries, put 

 them under bond, and allow them to sell the fruit to the 

 highest market price as fast as it was shipped to them. And 

 we have been successful. For I say to you that there is no 

 organization in the world composed of producers that has 

 the reputation for doing anytliing like what the Southern 

 California Fruit Exchange has done. 



Not counting this year, but five years previous to this 

 year, we tranacted a business of $25,000,000, and our finan- 

 cial losses were less than % ol\ percent — something. If you 

 will ask your bankers East, or any place, to give you a 

 record of anything of the kind, they can give you nothing, 

 because it is a wonderful record. 



The California Fruit Exchange is made up of producers 

 that have been successful. There were always some grow- 

 ers that would not unite with the Southern California Fruit 

 Exchange, and that would rather sell their fruit on board 

 cars in California than to ship to Eastern markets and take 

 their chances there. We issued a circular for years, show- 

 ing that we could show better results than selling f. o. b. 

 California, for this reason : In shipping East we did away 

 with trying to encourage the producer to gamble on the 

 future. No class of farmers make a greater mistake than 

 those who are trying to speculate and gamble. Grow your 

 product ; put it on the market, and that is all the producer 

 is entitled to. If he undertakes to hold it one year, or two 

 years, or three years, he is gambling, and it spoils him if 

 he once wins, generally speaking. 



This exchange has done more towards helping the indus- 

 try than anybody not familiar with the facts can realize. I 

 remember in the bank where I was engaged, that it was 

 almost always slow money on orange land. The first ques- 

 tion asked was, " What did you realize for your crop last 

 year?" and the majority had to acknowedge that they real- 

 ized nothing out of their crop. 



How can you expect to borrow when you can not show 

 how you are going to pay interest? You can not do it. As 

 soon as the organization was effected, the banks all over 

 Southern California came to the association, and said : " If 

 you have any growers who desire any money advanced to 

 them on their crop, we are willing to advance any reasonable 

 amount of money." Within two years it was altogether a 

 different proposition to go to the bank and borrow money, 

 from what it had been. I claim it was altogether on account 

 of the organization, because it placed the industry on a 

 sound basis. 



Of course, there is always more or less trouble and dis- 

 satisfaction in any organization of this kind. Each man, 

 whether a producer or a seller, has a part to perform, and 

 unless he does his part, and does his part well, you can not 

 expect good results ; but, almost invariably, if you will give 

 me any cause of dissatisfaction or trouble, I will show you 

 that the trouble has been that some one has neglected to do 

 what is right, and to do his duty. If the grower will grow 

 his fruit, put it on the market, he has done what he can ; 

 then leave it to the selling agents. 



I want to say that on account of a good many of the 

 growers not coming into the Southern California Fruit Ex- 

 change, on account of about SO percent of them always 

 wanting to sell their fruit f. o. b. California, there is always 

 a good deal of competition coming up. For instance, there 

 was about SO percent of the fruit acreage right in competi- 

 tion with the grower, and the growers themselves were the 

 worst enemies that the organization had in competition, 

 because the commission merchant found he could ship his 

 next door neighbor's fruit and compete with us. 



I will speak of the Exchange selling fruit in competi- 

 tion with the outside shipper. If he can get his money he 

 has done his part, and the other fellow must take the 

 chances and risk. Every man does that who goes into the 

 market. We do, and, of course, if he can not sell it one way 

 he will sell it another. 



One of the easiest ways to sell fruit is to cut the price — 

 that is, a great many people believe that, and almost as soon 

 as our car strikes a market, there is another car on the track. 

 We have a great many times met competition, and some- 

 times have cut the price. A proposition came to us last 

 winter to do away with the cutting of prices. The outside 

 shippers got together and formed what is now called the 

 California Citrus Union. They came to the Exchange and 

 said, " We do not want our growers to give up their idea of 

 selling their fruit. We want to come with vou and form 



