1 



AC.RirULTURAL APPROPKIATlON BIIJ., lf©4. 50l 



Before we know tliat those romplnints wouM he JIIimI, w - -•--...i:rt 



to analyze the eonunission nirn's oprrations in five typ 



for the purpose of detenninin}; just how they K"^ their revenues aiid 



for what purpttscs they expfodrd thrir tnnnrv. havinif in iiiind th«« 

 ohjert of joiiiparin},' th(»s(> (hlfemit markets and utdi/.in^ the infor- 

 mation in arriving at sound prmeiplen to eover our future rate «|c- 

 tenninations. What w«> would hke to do woidd f)e to have nonie 

 fundamental facts that will shorten thf rati* work later on. For that 

 purpose we s«'le<ted Pit tshurj^h. St. Paul. Omaha. Fort Worth, aufl 

 Portland. All of them exeept Pittshup^h were su))se<|uentlv hroU::ht 

 into the «(tmplaints. so that the time was well employe<l w)ien thono 

 markets were selected. 



Now, hy takinj^ the eonilitions at those markets an interestinij eom- 

 )arison ran he nnuh*. We will take Pittshtir<;h. F'ort Worth, and 

 *ortland; and, rouiihly spenkini:, they are in one i^roup, while St. 

 l*aul and Omaha arc in another ^roup. At Piltshur^di there — "» 

 commissi(ni ajrencies, at Forth Worth 1.'^ and at Portland S. of , 



6 were in continuous operation durini; 1921. At St. Paul there are 31 

 cominissioiT agoiicies and at Otnaha 54. In looking; over tli<:r 

 fijjures we find that at Pittshurj^h their averaire net return to llie 

 owners is 60 per cent of the income, at Fort Worth per cent, at 

 Portland 37 per cent, at St. Paul 27 per cent, and at Omaha 38 per 

 cent. Omaha and Portland operate on practically the same pei- 

 centa^xo. We took the averajre net return to the owners without 

 rejjard to the percentaf^es. and we have an avera<;e net return in 

 Pittshurjjh of .?23.nOO, as against only SI6.000 in Omaha an«I SI. <>'•') 

 in Fort Wc^rth. Now, as a matter of fa^t, in exsinininf; th 



we find that Pittsburj^h, for example, accompli.-hed tiiose ne; i 



largely by not spending so much money as the others or not spon 11 n,' 

 so much money in advertising, s')licitation, or anything else har My. 

 Practically all of the items of expense v ere greatly behnv those of any 

 other market. Now, of course, all of those things are affected by the 

 volume of business, and we have not completed our statistical informa- 

 tion on the volume of business. That is ]>eing worke 1 up nov. so as 

 to apply those figures to the volume of business. An interesting 

 thing about that is the wav thev distribute their income when thev 



f^et it. Among other things, in the course of this comparison, we will 

 )e able to show just how the cooperative enterprises working in the 

 same markets get along as to expense, and as to cost per ear, per heti I. 

 or per pound, as compared with the old line agencies. In othi r 

 words, we will probably get something that is fact rather than con- 

 jecture on those points. 



Mr. Anderson. Of course, to really furnish much of a basis for 

 comparison, I assume that those figures would have to be divided 

 into volume of business in some way, so as to get at the cost per car, 

 per head, or per pound. 



Mr. Morrill. 1 es, sir; ajul we are taking all three of those things. 

 We are going to work it out per car, per head, and per poun«l, and 

 then we are dividing it by species, of course. Then, we are takmg 

 into consideration just how much money they spend for eacli class 

 of expense. solicitatit)n, advertising, etc. Some of thetn spend a 

 great deal more for advertising than others. For instance, in some 

 markets a fjjreat deal of money is spent for market pai)ers. The 

 secretary of one exchange told me last winter that many shippers 



