ipo COOPERATIVE MARKETING 



the impending difficulties. The various associations soon 

 became convinced that a purchasing agency, composed of 

 all the associations within the exchange, was the only pos- 

 sible way to break the power of the box combination. 



So in 1907 the Fruit Growers Supply Company was 

 organized. The officers and directors of the corporation 

 are the same as those of the California Fruit Growers Ex- 

 change, with the reservation that the Supply Company has 

 its own manager. In its capitalization the Supply Company 

 is extraordinary. Instead of selling stocks and bonds, its 

 capital was furnished by an agreement among the associa- 

 tions to deduct three cents from each box shipped for five 

 years, and turn the proceeds over to the new company. 

 Then shares of $10 each were to be issued to the associa- 

 tions in proportion to their contributions. With the capital 

 thus secured, the Supply Company began to render financial 

 aid to small box manufacturers who had not joined the 

 selling agency and who agreed to furnish shooks at thir- 

 teen and one-half cents. As soon as this policy was in- 

 augurated the large manufacturers tried to disrupt the new 

 organization by offering boxes at eleven cents, in very much 

 the same manner that packers and shippers attempted to 

 frustrate the early efforts toward cooperation in marketing 

 by offering members more for their fruit than they were 

 likely to get if they shipped through the exchange. In both 

 instances the attempts came to naught, because the growers 

 had had all the experience they cared for with speculative 

 shippers or exploitative box manufacturers. 



By 1 9 10 the Supply Company was on a sufficiently firm 

 financial basis to justify broadening its scope of operations. 

 Though independent box factories were furnishing shooks 

 at a reasonable price, there was no assurance that they 

 would not at some time join the selling agency and place 

 the citrus growers in a very embarrassing predicament. So 



