The total economies of scale in broiler chick hatching are continu- 

 ous, and the average costs decrease from 2.005 cents to 0.968 cents per 

 chick for hatcheries ranging in capacity from 121,800 eggs to 2,029,500 

 eggs. The cost per chick initially decreases relatively fast with increasing 

 scale, but the economies are small with increases in scale above a capa- 

 city of 700,000 eggs and an annual output of 7.5 million chicks. Savings 

 in labor accounts for 72 percent of the economies. 



The combining of a debeaking operation along with hatching in- 

 creases labor, equipment, and supervisory costs. The net additions to 

 hatching costs are not continuous with increased capacity, and the de- 

 beaking cost ranges from 0.115 cents and 0.077 cents per chick. The com- 

 bined costs for hatching and debeaking fall continuously with increasing 

 scale from 2.120 cents to 1.045 cents per chick. 



Performing vaccination concurrently with debeaking increases 

 labor, supply, and supervisory costs per chick by a relatively constant 

 amount for all hatcheries analysed. The added cost amounts to betAveen 

 0.448 cents and 0.444 cents per chick. Coml)ined costs for hatching, de- 

 beaking, and vaccination decrease from 2.568 cents per chick to 1.489 

 cents over the range of hatchery sizes analyzed. 



Chick distribution costs were synthesized for six of the eight model 

 hatcheries. The volume ranged from 25.000 chicks distributed during 

 two days a week to 417,500 chicks distributed over six days a week. 

 Costs w^ere developed for each distribution model for each of three area 

 density levels: 298, 1491, and 7,455 chicks per square mile per year. At 

 any of the density levels, average cost initially decreases with increasing 

 volume but eventually increases. The vehicle cost per chick decreases 

 as the number of hatch removals and distribution days a week increases 

 and as firms adopt larger vehicles with lower unit operating costs. Once 

 these features are exploited, vehicle costs commence to increase. 



The labor cost per chick increases with increased volume at any 

 density level. This occurs because the time expended in travel increases 

 while labor productivity at the farm for placing chicks is constant at 

 5.000 chicks per man-hour. 



With increasing volume at the low density level, distribution costs 

 decrease from 0.231 cents per chick for a model distributing 12,500 chicks 

 a day twice a week, to 0.176 cents per chick for a model distributing 

 18,800 chicks a day four times a week. Costs increase for larger volume 

 models. At the density level of 1,491 chicks per square mile per year, the 

 distribution cost decreases from 0.196 cents per chick for the smallest 

 model to 0.113 cents per chick for a model distributing 25,050 chicks a 

 day six days a week. Costs increase for larger volume models but discon- 

 tinuously. At the high density level of 7,455 chicks per square mile per 

 year, the distribution cost decreases from 0.182 cents per chick to 0.078 

 cents per chick for a model distributing 34,800 chicks a day six days a 

 week, and costs increase discontinuously for larger volume models. 



For any given volimie of chicks, increasing density reduces distribu- 

 tion costs. However, the reduction is not the same for all volumes. In- 

 creasing density from the 298 to the 1,491 chick level resulted in reduc- 

 tions ranging from 15 to 51 percent. The reductions increased with in- 

 creases in the volume distributed. Increasing density from the 1,491 to 



