40 BULLETIN 1414. U. S. DEPARTMENT OF AGRICULTURE 



points, the producing and consuming areas served by each are rather 

 limited — often a cash buyer handles but one product, and uses a 

 limited number of markets. 



The buying broker operates much like the cash buyer, except that 

 he does not buy for his own account but acts as the agent of the 

 purchaser. Generally the buying broker handles only car-lot quan- 

 tities which he inspects, purchases, and ships in accordance with his 

 principal's instructions. His compensation is an agreed brokerage 

 charge. 



TERMINAL AGENCIES 



Brokers located in the terminal car-lot markets are the agents of 

 the sellers. A broker receives quotations, presents the seller's offer- 

 ings and terms to the buyers, and reports the buyers' acceptance, or 

 their counter offers to the shippers for confirmation or rejection. If 

 the sale is confirmed, the broker's responsibility is at an end when 

 he reports the shipper's confirmation to the buyer. The shipper 

 assumes the financial risk and the task of collecting the proceeds of 

 the sale from the buyer. The broker's compensation is generally a 

 stated charge per car which varies somewhat for different com- 

 modities. 



Another agency of distribution is the fruit and produce auction. 

 One or more auctions are located in Baltimore, Boston, Chicago, Cin- 

 cinnati, Cleveland, Detroit, Minneapolis, Newark, New Orleans, New 

 York, Philadelphia, Pittsburgh, St. Louis, and St. Paul. They re- 

 ceive shipments on consignment and place samples of such shipments 

 on display in the warehouses. Shipments are listed and described as 

 to quantities, grades, condition, variety, and other factors necessary 

 to establish value, in catalogues circulated prior to the sale. At the 

 call, the lots of fruit and produce are sold to the highest bidder. A 

 fixed percentage charge, plus the freight, is deducted and the balance 

 is remitted to the shipper, or his agent. Jobbers, retailers, hucksters, 

 hotel supply agencies, and other less-than-car-lot buyers purchasing 

 fairly large quantities, patronize the auctions. Sales to out-of-town 

 buyers are limited. 



The f . o. b. auction is national in character, maintaining a central 

 office with branches or salesrooms in several of the larger cities. 

 Shipments at shipping point, or en route, that have been inspected at 

 point of origin by Federal agents are listed for sale. Such listings 

 are made by telegraph to each auction salesroom. At call, the buyers 

 assemble at each of the auction rooms and make bids on the lots in 

 which they are interested. These bids are transmitted by telegraph 

 to the central auction office, and to all other auction rooms, so that 

 bidders may know what other bids have been made. The auctioneer 

 who conducts the sale is located in the central office. He sells the 

 shipment to the highest bidder in any market, at a certain price 

 f. o. b. shipping point. The purchaser pays the branch house of the 

 auction located in his market, and the money is remitted through the 

 central office to the shipper. 



Commission merchants are to be found in nearly all wholesale 

 markets. They are receivers of car-lot, or often less than car-lot 

 shipments consigned to them by growers, growers' associations, or 

 other marketing agencies. They dffepose of these shipments in com- 



