Apra, 1933 



THE I. A. A. RECORD 



Page Fifteen 



Marchant Sees Good 



Year For Oil Company 



ILLINOIS Farm Supply Company 

 has passed the half-way mark in 

 another year with the largest vol- 

 ume for a corresponding period 

 during the history of the company, 

 Manager L. R. Marchant said be- 

 fore the I. A. A. board of directors 

 March 23. 



The total number of tank car 

 shipments is approximately 6.76% 

 above the corresponding period in 

 1932 which is considered remark- 

 able in view of the average de- 

 cline of 8.98% in the industry in 

 Illinois. 



A consolidated statement of all 

 companies associated with Illinois 

 Farm Supply Company during the 

 calendar year 1932 shows total sales 

 of $4,475,185.03. If the income of all 

 the companies had been equally 

 distributed among all Farm Bureau 

 members in good standing in the 

 state at the end of the calendar 

 year 1932, the return would have 

 been $13.68. If distribution had 

 been made to Farm Bureau mem- 

 bers in good standing in the terri- 

 tory served, the average would have 

 been $15.95. On the other hand, if 

 distribution had been made among 

 the Farm Bureau members in good 

 standing in the territory served, 

 who were patrons of the companies, 

 the average would have been well 

 above this figure. 



Difference In Companies 



A summary of the comparative 

 analysis of the business operations 

 of the associated companies indi- 

 cated that the fifty-two companies 

 could be classified in four different 

 groups, on the basis of net income. 

 The control of operating expenses 

 is a prominent factor in the oper- 

 ations. The more efficiently oper- 

 ated companies were able to show a 

 better net income at the end of the 

 year and consequently a higher 

 patronage refund. 



Detailed information on the 

 twelve most efficiently operated 

 companies in the state was pre- 

 sented and the importance of con- 

 trolling certain operation factors 

 brought out. It was pointed out that 

 a substantial Farm Bureau mem- 

 bership must be maintained; other- 

 wise there will be a tendency to 

 break down the system of distribut- 

 ing the income among Farm Bu- 

 reau members; also that an ag- 

 gressive sales program must be car- 

 ried on at all times in order to 

 maintain the present volume which 

 in a large degree governs the pos- 

 sible net income to the income. 

 Furthermore, the lack of aggres- 

 siveness and proper management is 

 likely to lead to the outcropping of 

 undesirable competition in the ter- 

 ritory. 



"In general," said Mr. Marchant, 



I. A. A. Audit Service 



"An audit service such as 

 that given by the Illinois Ag- 

 ricultural Auditing Association 

 is fundamental to the success 

 of any co-operative business," 

 C. V. Gregory of Prairie Farm- 

 er said in a recent letter to 

 Manager F. E. Ringham. "I 

 only wish that the various co- 

 operatives in the state would 

 make still greater use of it." 



Fewer Fires Improve 



Casualty Co. Earnings 



A smaller number of fire losses 

 and an increase in earnings were 

 reported by J. H. Kelker, manager 

 of the Farmers Mutual Reinsurance 

 Company before the I. A. A. board 

 on March 23. 



In times of depression the prob- 

 lem of eliminating moral hazards 

 faces every insurance company, 

 said Kelker. When money is needed 

 to pay taxes and mortgage interest 

 the temptation to set fire to a build- 

 ing to get the insurance is ever 

 present. A number of companies in 

 adjoining states, he said, are now 

 withholding insurance money 

 where the building is not replaced. 

 Sentiment is growing against pay- 

 ing claims except where insurance 

 money is used to replace the de- 

 stroyed building. 



The financial statement of the 

 Farmers Mutual was stronger than 

 that of last year and reveals the 

 improvement in operations. The 

 company gives reductions for fire 

 prevention measures such as fire- 

 proof roofs, lightning rods, etc., 

 with the result that the average 

 rate on fire is around 32 cents per 

 $100. 



Lester Ryan has been employed to 

 manage the Galesburg unit of the 

 Illinois Livestock Marketing As- 

 sociation. 



Sid Cherrill who had been man- 

 aging the Galesburg unit is back on 

 his old job doing field work for the 

 State Association. 



"sound business principles must be 

 applied; managers must be active, 

 alert, and have some common 

 knowledge of business practices. 

 Sound sales and credit policies must 

 be maintained. Those in positions 

 of leadership must not be in- 

 fluenced by personal interest and 

 must have courage to run the com- 

 pany on a business basis; other- 

 wise they will be unable to main- 

 tain the good-will and the respect 

 of the people they are supposed to 

 serve." 



Hi-Ball Gas Proves Popular 



(Continued from page 7) 



on results a complete tabulation 

 will be made of the results obtained 

 under actual driving conditions, 

 with all makes of cars and trucks 

 and motors of every age and con- 

 dition. This is expected to furnish 

 most important facts from one 

 angle of the proposition, namely, 

 whether the new fuel will actually 

 work in a satisfactory manner and 

 whether it will find a ready market 

 at a premium. 



President Smith points out that 

 this is only one step in the march 

 for adoption of blended fuel as a 

 farm relief measure. In the first 

 place, comparatively few existing 

 distilleries are equipped to manu- 

 facture anhydrous alcohol which 

 must be used. Alcohol containing 

 water will not mix with gasoline. He 

 said that the committee's investi- 

 gation has revealed that if all the 

 distilleries capable of producing 

 anhydrous alcohol were to work at 

 full capacity and their entire out- 

 put devoted to dilution of gasoline, 

 the resulting blend would be only 

 about % of 1 per cent. It has been 

 learned that it will require three 

 years of intensive construction to 

 build distilleries of sufficient ca- 

 pacity to produce a sufficient 

 amount of alcohol to bring about a 

 10 per cent dilution. 



Legislative Problem 



The problem of legislation also is 

 important. It is recognized that 

 producing oil companies and re- 

 fineries will be inclined to oppose 

 dilution to the utmost. Whatever 

 legislation is attempted must over- 

 come this opposition and extreme 

 care must be taken in formulating 

 the measure to prevent it being de- 

 clared unconstitutional. 



Members of the committee, Mr. 

 Smith said, are extremely opti- 

 mistic regarding the whole dilution 

 scheme, particularly since early re- 

 ports indicate such a favorable re- 

 ception and such excellent operat- 

 ing results. They are proceeding 

 slowly, however, testing every step 

 in order that what may prove a 

 boon to grain producers in the long 

 run is not throttled by hasty action 

 in the beginning, and so that no 

 ill-advised action may be taken 

 which would be a detriment rather 

 than a help to the plan. 



"Everything will be done that it 

 is possible to do," Mr. Smith said, 

 "but we must proceed cautiously, 

 and base whatever conclusion we 

 reach on the facts, rather than on 

 opinion, however rosy the opinion 

 may paint the picture." 



