ii6 COOPERATIVE MARKETING 



When the representative of the association is chosen the 

 voting power over the association's nominal stock in the 

 district exchange is assigned to him. Then the various 

 delegates organize a new board of directors, electing a 

 president, manager, etc. It follows that the president and 

 all of the directors of the district exchange must be mem- 

 bers of some local association, but, adopting the practice 

 of the local associations, the directors of the district ex- 

 change do not necessarily elect one of their own number 

 for manager. The manager of the district exchange is so 

 vital to the prosperity of the section which he serves that 

 it would be suicidal to limit in any way the selection for 

 the place. Business ability of a high order is essential, and 

 it must be secured wherever it may happen to be found. 



The district exchange is undoubtedly the least understood 

 element of the exchange system, so its structure will be re- 

 capitulated before proceeding to its functions. A group of 

 packing associations, say, seven, in a given producing area 

 form a corporation which is to market the fruit for all. 

 Each of these associations, through its board of directors, 

 elects one representative to act as a director in the district 

 exchange. These elected representatives are the directors 

 and only stockholders of the exchange, control its policy for 

 the benefit of their local associations, and are responsible 

 to their respective associations. Each director's voting 

 power in the exchange is determined by comparing the 

 number of boxes shipped by the association which he repre- 

 sents with the total number of boxes shipped through the 

 district exchange. 



A basis for further study of the district exchange may 

 best be gained from an examination of the contract between 

 it and the local associations : 



Whereas, the system of marketing and handling citrus 

 fruits devised by the California Fruit Growers Exchange 



