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Two main factors have been responsible for tbe success of co-operative packing 

 associations from the first. No capital had to be supplied by the shareholders and each 

 pledged his entire output of fat hogs to the co-operative association. 



On the joint guarantees of shareholders the banks provide the necessary money 

 for the erection and equipment of the factory and working capital. The working fund 

 is increased in the beginning by holding back a small part of the value of the hogs 

 slaughtered. When this has reached an amount sufficient to carry on the work the 

 capital sum provided by the bank is reduced year by yeai*. As a rule the principal is 

 paid off at a rate to clear the whole debt in twenty to thirty years. The following is a 

 usual form of guarantee. 



We the undersigned hereby pledge ourselves to deliver to the Co-operative 

 Bacon Factory which it is proposed to establish, all the pigs of weights between 

 150 and 200 lbs. which we may produce for sale. Such pigs will be delivered on 

 conditions decided by the shareholders of the Society, and that we shall receive 

 such amount in payment of such delivered swine as may be realized for them by 

 the factory, less preliminary 'expenses incurred in the organization of the Society, 

 and the annual instalments on loan for building and plant payable during a 

 period of about 25 years, together with current working expenses. 



The guarantee is graduated according to the number of acres owned by each 

 memberfcrespectively. Ownership of 25 acres or less is sufficient for a guarantee of 

 about ^4 ; between 25 and 250 acres, $28 ; and for larger amounts $28 for each 250 

 acres. The guarantee of one member in no case exceeds $135. It is a fundamental 

 principle that each guarantor is a partner in the ownership of the whole property of the 

 factory in proportion to the amount of his respective guarantee. The penalty for 

 violation of the agreement to deliver all marketable pigs to the co-operative factory is 

 $2.70 per pig sold to any other concern or person. The further penalty of expulsion 

 from the Association may also be exacted. 



Shareholders who live within six miles of the factory as a rule deliver their pigs 

 free, but those living at a greater distance deliver to the nearest railway station, and the 

 association pays the freight from there to the factory. In some associations a bonus 

 of about 7 cents per hog is granted the shareholders who deliver their own pigs. The 

 packing plant agrees to accept every sound hog delivered. The pigs when delivered 

 are unloaded into a small car and a metal tag is put into the ear of each for identifica-' 

 tion. If the owners so desire the pigs may be weighed alive. Immediately after being 

 dressed they are weighed and classified. An advance covering a portion of the value, 

 based on the current quotations and the class to which the carcass belongs, is made at 

 once. About one-quarter of a cent per pound is withheld until the end of the year, 

 when the final premium is paid on the basis of weight of pork delivered during the 

 year. 



FIXING THE PRICE. 



In each province or district there is a committee to decide the price for the fac- 

 tories in that province or district. Quotations are fixed on Saturday morning for the 

 following week. The committee charged with this learns the views of the several com- 

 mittees attached to individual co-operative factories, and sets the price according to 

 the average of the recommendations of the several local committees. That is to say, 

 if five committees recommend 45 ore per pound while five others place the figure at 40 

 ore per pound for grade No. 1, the general committee sets it at 45J. To guard the 

 interests of all concerned an arbitrator is appointed to decide cases in dispute. 



A local committee to arrange quotations consists of three, the president, a well 

 known farmer who is not a director of the association, and the manager of a factory. 

 The manager lays before the others the latest telegrams and information in regard to 

 the state of the British bacon market and the results of the consignments shipped 

 during the week. After providing for a profit of $1.25 to $1.75 per hog, and a quarter 

 of a cent for working expenses, the committee decides upon its quotation. It was 



