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BULLETIN" 639, U. S. DEPARTMENT OF AGRICULTURE. 



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the larger dealers maintained expensive barns and wagons, while 

 some of the smaller ones had much less costly delivery outfits. 



The differences in costs of supplies and in the charges for interest 

 and depreciation are in the main the result of differences in the per 

 gallon investments. Figure 12 shows radical differences in the cost 

 of supplies in milk plants. As many of the dealers had operated 

 their newly equipped plants for only a short time, and since some 

 plants were not arranged efficiently or were not operated at full 

 capacity, the most economical use of supplies was not possible. 



Aside from advantages of busi- 

 ness experience, however, and 

 differences in the extent to which 

 machinery was run at full ca- 

 pacity, the larger dealers were 

 able to effect considerable econ- 

 omies by' the purchase of sup- 

 plies in large quantities. 



Figure 13 shows that the larger 

 dealers have lower labor costs per 

 gallon in plant operations than 

 the smaller plants, owing to the 

 economies effected through spe- 

 cialization of labor. The apparent 

 exception in the case of the two 

 larger groups is to be explained 

 by the fact that a larger propor- 

 tion of their output consisted of 

 bottled goods than in the case of 

 the smaller plants. In delivering 

 milk, however, there appears to 

 be no definite relation between 

 the size of the business and the 

 per gallon labor costs. 



The figures of the comparative 

 costs in Table XVII represent the 

 expenses of handling at the city 

 plant and of delivering to the va- 

 rious classes of trade. They do not include, however, such expenses 

 as are imposed on the business by surplus milk, soured or spoiled 

 milk, shrinkage in handling, shortages on delivery routes, and bad 

 bills. These items of loss or expense of the business were not obtain- 

 able from many dealers, because of a lack of efficient business organ- 

 ization or inadequacy of accounting systems to check such losses. 

 On account of the omission of those items of expense, Table XVII 

 possibly does not bring out all the comparative economies of large 



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Fig. 12. — Variations in charges for in- 

 terest and depreciation and cost of sup- 

 plies per gallon. 



