Table 21. Costs Per Chick for Distribution by Six Hatcheries 

 at Three Density Levels. 



Hatchery Vehicle Labor Management Total 



(cents per chick) 

 298 chick density level 



A 

 C 

 E 

 F 



A 

 C 

 E 

 F 

 G 

 H 



A 



C 

 E 

 F 

 G 

 H 



ing 18,800 chicks a day, four days a week and 3.71 million chicks annu- 

 ally. At the 1,491 chick density level, the cost decreases from 0.196 cents 

 per chick for A to 0.113 cents for E distrihuting 25,050 chicks a day. six 

 days a week and 7.41 million chicks a year. At the high density level, the 

 cost decreases from 0.182 cents a chick for A to 0.078 cents for F distri- 

 huting 34,800 chicks a day, six days a week and 10.3 million chicks a 

 year. 



This is a different result than would he expected in a theoretical 

 sense. If distance was the only feature of distriljution that varied as size 

 of firm, and therefore size of distriljution area, increased, the cost per 

 chick for distrihution should rise. However, this decrease in cost with in- 

 creasing volume is the result of the direction and rate of change in the 

 costs for vehicle operation and lahor. Vehicle operating costs decrease 

 at a decreasing rate as each successively larger hatchery operates a single 

 hut larger load capacity vehicle. This introduces economies in some of 

 the operating costs which offset those operating costs that increase with 

 expansion of the hroiler producing area. Furthermore, the numher of 

 distrihution days increase from two for hatchery A to six for E. This in- 

 crease spreads the fixed vehicle costs over an increasing numher of chicks 

 and reduces the unit cost. 



At each density level, lahor costs per chick increase with increasing 

 volume. This is a result of an increasing numher of man-hours heing 

 expended in travel in an expanding hroiler producing area. Eventually, 



40 



