16 MASS. EXPERIMENT STATION BULLETIN 304 



plans or prices paid to producers. The majority of them received for their milk 

 a flat price of 6 cents per quart. Only two local dealers purchased their milk 

 on the basis of butterfat test paying from 6 to 7J^ cents per quart depending on 

 quality, with an average of 6^ cents per quart. 



The prices paid to producers in the Newburyport market presented a more 

 uniform picture than in the other two markets. Of the total of 70 producers 

 supphing local dealers and distributors, 60 obtained a flat price of 5 cents per 

 quart, while the prices for the rest ranged up to 6 cents per quart. Except in the 

 cases of two distributors who took only a definite amount through the year, leav- 

 ing the care of the seasonal surplus to the producers, the arrangement was one 

 of mutual adjustment, where producers, being mostly close neighbors, tried to 

 keep their production within the current requirements of their distributor, and 

 the latter in his turn often accommodated his producers by taking a greater 

 amount of milk than he actually needed. 



From the standpoint of a small market the general structure of distribution 

 in Newburyport with the predominance of small dealers and distributors, each 

 obtaining his milk from several producers mostly his neighbors, seems to be the 

 most advantageous both in the way of market stability and better prices paid ta 

 producers. This system has been working fairly well in this market until recent 

 years, and its partial collapse has been due largely to the advent of outside milk. 

 However, if the pressure of surplus milk from other areas continues and the 

 producers in local markets are going to lose the advantage of their strategic 

 position, the best policy for them would be to join the existing organiz.ations of 

 producers and adapt themselves to new competitive conditions as they develop 

 in their markets. 



Producer-Distributors and Cost of Milk Distribution 



The tendency of many producers to establish themselves in the distributing 

 field during the last few years makes it essential to consider the advantages 

 obtained by direct sale of their product to the consumer. Accordingly, the costs 

 of distributing milk were obtained from 57 producer-distributors operating in 

 the three markets. L'nder normal conditions the question of the cost of labor and 

 time involved in distributing milk as compared with sale to a dealer is one of 

 the most important factors to be considered by producers. However, as demon- 

 strated by the figures obtained on farm family labor, in the last few years a 

 number of people employed in the city have returned to the farms of their parents 

 or relatives to stay during the period of unemployment. Likewise many of the 

 producers were found to be farming on a part-time basis, gaining part of their 

 income from factory or other employment. After losing their outside jobs, thereby 

 gaining more time for farming operations, those engaged in dairying in some 

 cases increased the size of their herds. This, however, was not always possible 

 either because of the inadequacy of the farm, the lack of additional funds, or, 

 most often, the difficulty of finding a profitable market for an Increased output 

 of milk. Under these conditions, among producers situated conveniently near 

 the markets there was a natural tendency to enter the distributing field, provided 

 they had the necessary equipment and the possibility of obtaining something 

 over and above the additional cash expenses incurred for the purpose. 



