34 BULLETIN 1414, U. S. DEPARTMENT OE AGRICULTURE 



adjustments are subjects commonly undertaken in special studies 

 and presented in special reports to the manager and board of direc- 

 tors. 



COST OF RECORDS 



Bookkeeping and accounting systems are often looked upon as 

 necessary evils, the expense of which should be reduced in every 

 way possible. This often results in the hiring of incompetent em- 

 ployees, or in the failure to employ sufficient help to handle the work 

 properly. Although it is important to keep down overhead expense, 

 the value of accurate records must not be overlooked. For that rea- 

 son the employment of competent persons at reasonable salaries is at 

 present considered necessary to the safety and successful operation 

 of the business. 



POOLING 



Approximately three-fourths of the fruit and vegetable associa- 

 tions pool the returns received for shipments of the same variety 

 and grade. Thus the producer instead of receiving the price at 

 which his products are sold, less necessary expenses, gets the average 

 net price received for all similar products shipped during the sea- 

 son, or some shorter period, generally determined by the directors of 

 the association. 



The first purpose of pooling is to equalize price fluctuations and 

 prevent injustice to individual members. This is accomplished by 

 spreading gains or losses over all the volume handled during any 

 definite time, or pooling period. The entire burden, consequently, 

 does not fall upon those whose products, perhaps unavoidably, have 

 incurred losses. Likewise the profits of any particularly advanta- 

 geous sales are spread over all the transactions, raising the general 

 price to all the members. 



Another pronounced advantage of pooling is that it enables ship- 

 ments to be distributed throughout the season in accordance with 

 market demands. The sales manager of the association can control 

 the situation and no complaints regarding price inequalities will be 

 received from members, since all receive the same basic price for 

 products of the same kind and grade shipped during the pooling 

 period. Xot all shipments can be sold on the highest market, and 

 the tendency of unorganized growers to hold for what they consider 

 the most favorable market often defeats itself. Individuals may 

 withhold shipments during a period of advancing prices, expecting 

 the market to go higher. When prices decline it is seen that the 

 peak of prices has been reached, and a rush of shipments to market 

 may carry the decline to disastrous levels. This same tendency for 

 the individual, rather than the trained salesman, to attempt to fore- 

 cast market conditions, is present in associations that do not pool 

 their shipments. Ii nullifies many of the advantages of organization. 



METHODS OF POOLING 



Pooling systems used by fruit and vegetable organizations differ 

 considerably both in complexity and the length of time over which 

 the pool extends. The simplest kind of pool could be used by an 

 association handling one kind, variety, and grade of any product for 



