cr sold milk through other dealers. The quantities of milk involved in these 

 buying and selling transactions were usually small. Relatively few dealers 

 followed a planned program of "buying short" or "buying long." 



Information obtained on prices received for milk sold to other dealers 

 and prices paid for milk purchased from other dealers indicated the poor 

 bargaining position of independent dealers. Prices received were usually 

 the manufacturing price less handling charges and the cost of transportation. 

 Prices paid for milk purchased from other dealers were the current fluid 

 milk price plus charges for handling and transportations. 



A large part of the milk which was not sold locally as fluid milk or milk 

 drinks was separated. Most of the cream separated was sold on dealers' 

 routes for local consumption. Relatively little skim milk was used for fluid 

 sales and much was wasted. 



A separate study was made of the 34 dealers who did not attempt to 

 balance receipts with fluid sales. These dealers, generally, operated very 

 small plants. Half of them were producer-dealers and with only one exception 

 handled milk from their own herd's production exclusively. The remaining 

 dealers in this group who obtained their milk primarily from producers had 

 special arrangements for the profitable handling of excess milk. Ownership 

 of manufacturing facilities was not related to the method of balancing fol- 

 lowed by these dealers. 



The problem of balancing for independent milk dealers does not appear 

 to be serious in total volume. The quantities of surplus are usually small. 

 The evidence suggests that the best method of operation would be for inde- 

 pendent dealers to obtain the most uniform supply of producer milk possible; 

 limit their business to fluid products for local consumption; and sell or buy 

 milk price plus charges for handling and transportation. 



A considerable amount of space has been devoted in this report to the 

 technique used to measure the attitudes of dealers toward balancing. It is 

 felt that this is justified on the grounds that the technique is relatively new 

 and provides the most reliable and valid method available for attitude 

 measurement. The analysis of the balancing methods currently in use follow- 

 ed the direction suggested by the attitude investigation. Scalogram analysis 

 appears to be a suitable method of inquiry for ascertaining how and why 

 a firm decides to use a particular operational procedure. 



