538 AGRICULTURAL ECONOMICS 



apparent. It is the link or links between country shippers and the 

 retail store that many people have hi mind when they say that there 

 are too many middlemen. 



The need of wholesale produce distributors may best be demon- 

 strated by a consideration of the reasons why country shippers do 

 not and cannot generally sell their goods direct to city retail stores. 

 The reasons are as follows: 



1. To procure the greatest economy in local shipments, the 

 quantity sent at one time is too great for most retailers to handle. 

 Retailers carry a large variety of products, and storage facilities for 

 handling large units of various commodities are out of the question. 

 Goods would have to be sent in small allotments, and retailers would 

 have to obtain these small allotments from a great variety of sources. 



2. Shipments from local units vary in quantity from shipment to 

 shipment and for different tunes of year. The city supply of many 

 commodities comes first from one producing section and then from 

 another. The city retailer must be able to buy from day to day in 

 order to correlate his supply with his demand. Furthermore, the 

 shipments from the country at one period will be insufficient, whereas 

 at another period they are much greater than the retailers can absorb. 

 This surplus must be carried by a separate class of middlemen from 

 the period of surplus production to that of insufficient production. 



3. The quality of commodities sent by a country shipper is very 

 variable, whereas each retail store has a fairly definite class of trade 

 and must have goods of fairly constant quality. 



4. Business relations between country shippers and retail stores 

 are difficult to establish, and once established are difficult to maintain. 



5. Retailers are notoriously "slow pay." Country shippers can- 

 not afford to wait for their money, because they must be paying cash 

 for goods as they are brought in by the farmer from day to day. This 

 fact alone has been responsible for the giving up of innumerable 

 attempts to establish direct selling from country shippers to retailers. 



These reasons suggest the functions of wholesale dealers. These 

 functions are not generally understood; they are much more difficult 

 to perform and require a much greater degree of organization and 

 business ability than most people realize. Frequently they will be 

 subdivided among two or three different sets of wholesalers, as, for 

 example, a commission merchant, handling goods on consignment, and 

 a wholesaler or jobber; or a wholesale receiver who buys outright, 

 and a jobber who sells to retail stores. 



