574 



GLEANINGS IN BEE CULTURE 



September, 1922 



is usually 20 to 25 per cent of the price to 

 the consumer, and the retail price on this 

 honey would probably be $1.75 per pail. Let 

 us see how this looks: 



Cost of producing 10 pounds of honey.. $1.00 

 Cost of packing, label and contaijier. . .25 



Cost of jobber or wholesaler 15 



Cost of retailer 35 



Cost to consumer $1.75 



Do not get the idea that the jobber makes 

 15 cents on every can of honey he sells. His 

 profit is really infinitesimally small on each 

 individual can. Out of the 15 cents he must 

 pay drayage, rent, office expense, salesmen 's 

 salaries and a dozen other costs. His abil- 

 ity to do business at all rests wholly upon 

 volume. Neither does the retailer make 35 

 cents on every can. His costs are propor- 

 tionally lieavier because his sales volume 

 is smaller and in addition he has greater 

 risks of all kinds. 



Let us consider, for a moment, honey 

 packed in glass and in smaller containers 

 than the ten-pound pail discussed above. 

 As the container becomes smaller and more 

 expensive, the "spread" becomes automat- 

 ically greater because new factors of cost 

 enter in. Labor is proportionally greater, 

 the container is enormously more expen- 

 sive, and the costs of sales mount. It costs 

 the retailer practically as much to make a 

 sale of a one-pound jar as it does to sell a 

 10-pound can because his sales are all unit 

 sales anyway. In fact, we sometimes find 

 that the 10-cent honey we have been con- 

 sidering has to be sold as high as 40 cents 

 per pound in certain expensively labeled and 

 attractively packed pound jars, especially if 

 freight and transportation charges enter in, 

 and this without anyone making an undue 

 or excess profit on any of the transactions. 

 All these matters should be given thought 

 and study by the producer who sells his 

 own product. 

 When the Producer Becomes a Merchant. 

 The business of producing is one thing; 

 the business of marketing is another. When 

 the producer becomes a merchant and sells 

 his own product he should have, and should 

 insist upon having, the wages of a mer- 

 chant. This is common sense. Besides that, 

 it is vital, if he is to establish a perma- 

 nent and standardized market, that he rec- 

 ognize these facts and respect these profits. 

 If he persists in selling direct to retailers at 

 the same price the jobber pays, the effect 

 will inevitably be that the jobber will no 

 longer handle honey and the general dis- 

 tribution system will break down. If he per- 

 sists in selling to the consumer at the price 

 paid by the retailer, the latter will justly 

 refuse to handle honey, and the means of 

 distribution will in time become limited to 

 the range of the peddling wagon of the 

 foolish producer who has killed the goose 

 that laid his golden eggs. The merchant is 

 tlie ])est friend of the producer of any com- 

 modity. It is the merchant and the estab- 

 lished trade channels that make economical 



distribution possible. Honey has never been 

 over-produced; it has merely been under- 

 distributed. The honey producer has been 

 in great measure at fault for this, because, 

 by direct sales in small quantities at ruin- 

 ously competitive prices, he has discouraged 

 the merchant from handling it. 

 Summary. 



Let us resume for a moment some of our 

 main considerations: 



1. Standardization of retail package as 

 to kind and style. This has been done auto- 

 matically with comb honey, but is still a 

 problem in the marketing of extracted and 

 bulk comb honey. 



2. Standardization of retail price. Tliis 

 has been impossible up to now because of 

 the wide areas in which honey is produced 

 and the lack of co-operation among bee- 

 keepers. Also, there has been a lack of the 

 true knowledge of market and crop condi- 

 tions. 



3. Proper appearance of the package from 

 the standpoint of attraction to the buyers. 

 With many men of divers habits and minds 

 packing the product individually, this has 

 been a difficult problem. 



4. Proper publicity back of the package, 

 including general co-operation with the 

 dealer. If this is ever done it must be done 

 by some such concerted movement as the 

 American Honey Producers ' League. 



5. The proper channels of distribution 

 should be recognized and protected. To get 

 lioney before all buyers, it must be handled 

 as a staple commoditv and this brings us 

 to— 



n. The proper prices at which honey must 

 be sold to jobber, retailer and consumer. 

 The beekeeper wlio becomes a merchant must 

 take into account his costs as a merchant 

 and demand his wages for the service he 

 renders. In doing so he will encourage the 

 handling of honey by the regular trade clian- 

 nels and greatly widen his field of distrilm- 

 tion. 



The remedy is threefold: Co-operation, 

 education, publicity. 



Here and there are springing up groups 

 of beekeepers who are organizing co-opera- 

 tive marketing associations that are rapid- 

 ly solving, in their limited trade areas, 

 some of these problems. Grade standards 

 and package standards are being evolved, 

 and more respect is being shown to the 

 conventional channels of distribution. By 

 their example and their persistent efforts 

 to educate their neighbors much good 

 is coming. The individual beekeeper, hero 

 and there, who is not in touch with these 

 moA'-ements, must slowly become educated 

 jilong these lines, and when really cognizant 

 of the true conditions he will also become a 

 co-operator. 



Yov coTuplete success ever to come, this 

 education of the isolated individual is nee 

 pssarv. One beekeeper who produces 500 to 

 5,000 pounds of honey can absolutely de- 

 moralize the market of a whole group of 

 beekeepers who produce 100,000 pounds. 



