7,455 chick level resulted in additional but smaller reductions in cost. 

 These reductions ranged from 7 to 33 percent. 



In-plant economies of scale exist throughout the range of the six 

 poultry marketing systems consisting of processing, hatching, broiler 

 assembling and chick distributing functions. The cost per bird for pro- 

 cessing and hatching decreases from 15.491 cents for a system processing 

 1.19 million birds per year to 10.287 cents per bird for a system process- 

 ing 19.76 million birds annually. 



Depending on the density of broiler production, the addition of the 

 transfer functions, chick distribution and broiler assembly, tends to or 

 does overcome the in-plant economies. At the low production density 

 level of 1,000 pounds per square mile per year (298 chicks per square 

 mile per year) the total combined cost per bird decreases from 18.816 

 cents for a system processing 1.19 million birds per year to 15.726 cents 

 for a system processing 7.11 million birds per year. Costs increase for 

 larger scale systems. At the 5,000 pound (1,491 chick) density level, 

 total combined cost per bird is less for each system than at the previous 

 density level, and decreases continuously throughout the range of sys- 

 tems analysed. Costs decrease from 17.925 cents to 13.635 cents per bird. 

 However, the economies are extremely small for systems processing more 

 than 9.88 million birds per year. At the high density level of 25,000 

 pounds (7,455 chicks) each system has slightly lower costs, and econo- 

 mies exist throughout the range of systems analysed. Costs decrease from 

 17.491 cents per bird to 12.663 cents per bird with most of the economies 

 occurring between systems processing 1.19 million and 14.82 million 

 birds per year. 



Poultry systems consisting of these four functions can reduce costs 

 by reducing the size of the broiler producing area. Systems increasing in 

 scale cannot continue to expand broiler production at a given density 

 level but must increase broiler production density to gain the potential 

 economies from the in-plant functions. 



