CHAPTER IX 



MARKETING AND THE MIDDLEMAN 



Four Steps in Marketing. In recent years the discussion of 

 marketing has taken the form of a crusade against the middleman. 

 However, the so-called " marketing problem," when studied, is 

 found to break up into four separate problems, namely, produc- 

 tion, storage, transportation, and credit. In other words, when 

 these four problems are solved, the " middleman problem" will 

 disappear. (1) The production of a good product is the first and 

 most important step in marketing. It is never difficult to sell 

 products of the best grade. The daily market reports and price 

 currents indicate brisk demand at good prices for the better grades 

 of farm products, but, at the same time, the markets are often 

 glutted with poorer grades. To put a high-grade product on the 

 market, particularly if it be inspected and graded and standard- 

 ized, is to take the first and biggest step in marketing. (2) Storage 

 is a step made necessary with most farm products by reason of 

 their production in the summer time and their consumption at 

 other seasons. These crops accordingly must be stored some 

 place by somebody, and the middleman accordingly usually enters 

 at this point to begin his services. Some highly perishable products 

 show a tremendous shrinkage in storage. Thus the southern sweet 

 potato, needing warm dry storage in winter, shows an annual loss 

 in storage estimated at one hundred million dollars. The white 

 potato of the north, calling for cool, dry winter storage, also shows 

 a heavy w r aste. Other farm products, such as eggs, poultry, grain, 

 cotton, and so on, all call for particular forms of storage to bridge 

 the gap between time of production and time of consumption. 

 In the last analysis, considering farmers' cooperative storage ware- 

 houses, public and private storage warehouses of all kinds, and 

 the consumers' own cellars, the retailer is doubtless the chief 

 storer of food products. The retailer must actually own and store 

 nearly 100 per cent of the food products which the ultimate con- 

 sumer buys. Here is an important function of the retailer. One 

 investigator has estimated that the annual waste by decay of 

 perishable food products is 40 per cent. (3) Transportation is, 

 next to retailing, the most expensive link in the chain of marketing. 

 And the most expensive phase of transportation is the haul over 

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