6 BULLETIN 860, U. S. DEPARTMENT OF AGRICULTURE. 



considered. The volume of business which any single elevator is 

 able to control will largely determine the minimum margin per 

 bushel that is required to meet the overhead and operating expenses. 

 The operating cost per bushel necessarily must be greater in han- 

 dling 100,000 bushels per year than it would be in handling 200,000 

 bushels per year. This applies with particular force to elevators 

 dealing in grain exclusively. Of course, elevators which look to 

 an extensive merchandise business for their main source of income 

 may handle a small volume of grain with very little additional cost. 

 Not infrequently such operators use their grain business as a feeder 

 to their more profitable merchandise business, in which case com- 

 peting elevators, handling grain exclusively, are placed at a decided 

 disadvantage. 



Although the community need for cooperative marketing can not 

 always be judged from the number of existing commercial agencies, 

 for cooperative marketing may be made necessary at times by reason 

 of having too many such agencies, their number and character be- 

 come of vital importance in estimating the probable success of addi- 

 tional marketing facilities. Hence, if from a conservative study of 

 local conditions and as a strictly business proposition, it does not 

 appear that a coorperative company is likely to be successful, its 

 organization had better be held in abeyance. 



PROSPECTIVE MEMBERSHIP. 



Having studied the local conditions and the need for organization, 

 it will be desirable to test the community, sentiment and desire. A 

 cooperative elevator to be successful must, first of all, have a mem- 

 bership considerable in number and sufficient to insure a dependable 

 patronage from the start. Prospective membership should be deter- 

 mined, if possible, by actual personal canvass of the community. 

 General mass meetings are desirable for the purpose of acquainting 

 the public with the principles of cooperative marketing and for 

 the purpose of free and open discussion of the need therefor ; but for 

 the purpose of a concrete and physical appraisal of membership, 

 nothing will serve so well as a formal expression from each inter- 

 ested person. Every community has " chronic enthusiasts " who are 

 in favor of everything that is proposed, but who, when the time 

 comes for assuming definite obligations, find it easier to make 

 excuses. The personal canvass may be made at any time, before, at, 

 or following a general meeting, when the people have been thor- 

 oughly acquainted with the objects of the proposed organization. 



CAPITAL. 



The matter of capital requirement is important and the prelimi- 

 nary survey should be extended to cover a careful estimate of the 



