Retailing Milk in Laconia 



By E. H. RIN'EAR, Research Specialist in Marketing, and 

 H. C. MOORE, Assistant Dairy Husbandman 



Because milk-marketing problems in Laconia are considered typical of 

 many other communities in the State, a study of retail distribution was 

 begun early in 1932. It was known that price cutting is commonly prac- 

 ticed and that the number of producer-distributors is large in proportion to 

 the city population, thereby causing much duplication in travel, labor and 

 expense. In view of these conditions the question has frequently been 

 asked, "Are there more efficient methods of distribution that would yield 

 larger returns to the producer?" 



Method and Procedure: 



To obtain data which would help to answer this question, a field survey 

 was made of all producers who were performing part or all of the market- 

 ing services in retailing milk. Individual records of the previous year's 

 business were taken on current costs, type of equipment, time required to 

 bottle and to deliver, distance traveled, amount of milk sold daily, number 

 of customers, prices received and other related information. This material 

 was tabulated and cost ratios made for each producer and distributor under 

 the following heads : 



Current costs — Advertising, bad accounts, bottles, caps, depreci- 

 ation of equipment, electricity, ice, interest on value of equipment, 

 tickets and miscellaneous. 



Delivery costs — A charge of six cents a mile was made for use 

 of auto or horse and wagon for total distance traveled on the 

 route. This does not include any charge for labor when delivering 

 milk. 



Returns for labor — This may be defined as the value of the pro- 

 ducer's time in retailing compared to wholesaling milk, or the 

 return for time required to wash bottles and to bottle and to 

 deliver milk to customers. It was obtained by taking the average 

 difference between the net price at the farm for Class I milk if 

 sold through wholesale channels and the average net price received 

 in retailing after current and delivery expenses had been deducted. 



To determine quality of milk sold, samples of bottled milk were taken on 

 the streets as the milk was being delivered and were plated for bacteria the 

 same day in Durham. Total number of bacteria present in the samples was 

 determined by following closely the technic described in "Standard Meth- 

 ods of Milk Analysis." The per cent of fat was established by the Babcock 



