As firm size increases with production density held constant, most 

 of the increase in the unit assemhly cost is due to higher unit lahor and 

 bird shrinkage costs. Moderate increases occur for truck and crew trans- 

 portation costs. The unit crate cost remains approximately the same. 



Increasing density at any firm size results in a reduced unit assem- 

 bly cost. However, the per unit cost decreases at a decreasing rate. For 

 example, firm D has a reduction of .472 cents a pound when density is 

 increased from the 1,000 to 5,000 pound level. Increasing density from 

 the 5.000 to the 25.000 pound level results in a substantially smaller 

 alisolute decline, .226 cents a pound. 



Figure 3 illustrates broiler assembly costs for six firm sizes at vari- 

 ous production density levels. The per unit cost decreases rapidly for 

 all firm sizes as production density is increased up to levels of 8.000 to 

 12,000 pounds per square mile per year. Further increases in production 

 density do not result in substantial decreases in the unit assembly cost. 

 For any given density level between 1,000 and 25,000 pounds, successive 

 increases in firm size result in a higher unit assembly cost. 



Figure 3. Broiler Assembly Costs per Pound at Various Production Density 



Levels for Six Firms. 



1.4 

 1.2 



o 1.0 





.6 



.4 



.2 







A through F = firms 



5 10 15 20 



Broiler production density • thousands of pounds per square 



mile per year 



25 



IV. Chick Distribution 



Chick distribution consists of hauling "day old" broiler chicks from 

 the hatchery to the broiler production units. Upon arrival, the driver 

 and possibly a helper check the broiler house and then unload and place 

 the chicks in the house. The boxes used to transport the chicks are re- 

 loaded in the truck and the driver proceeds to additional farms or re- 

 turns to the hatchery. 



The chick distribution activity differs in two respects from either 

 broiler assembly or feed distriliution. First, chicks are extremely small 

 and hght in weight compared to tlic mass and weight of finished broilers 

 or feed. Many hatcheries can easily ship in one truck on a single trip 

 th(^ output of a day's hatch. Second, chick distribution is not regularly 



12 



