corrugated cardboard containers on a joint 
or cooperative basis, 
Slightly over half of the processors believed 
that cooperative manufacture was either a 
possibility or a definite opportunity (table 18), 
They thought that savings from manufacturing 
would exceed those from cooperative purchase 
of containers. Opinions ranged from ''possible 
opportunity if enough volume could be de- 
veloped" to ‘''definitely are going into can 
manufacture" and "hope to get into the fabri- 
cation of corrugated cardboard containers 
within 2 - 3 years," 
OPERATING REQUIREMENTS 
Requirements for the successful manufac- 
ture of cans varied among persons interviewed, 
Among factors causing variation are the size 
and weight of can, number of lines, local prices 
of tin plate, local labor and power rates, stor- 
age requirements, quality of equipment, and 
competency of the canmaker or plant manager, 
Reports indicated that the minimum annual 
production of cans to operate an efficient 
plant on a break-even basis is about 12.5 
million 46-ounce cans up to 40 million 12- 
ounce cans, Some, however, indicated a mini- 
mum of 10 million one-gallon cans and 50 
million small No, 202 cans is needed, A plant 
producing only one size can may operate effi- 
ciently. 
Approximately $1.5 million would be re- 
quired to establish a plant with one line making 
one size of can. This amount would provide 
land, building, equipment, and initial operating 
capital for material and personnel. About a 
third of this would be required for equipment. 
The total amount would vary, however, with 
local conditions and storage area require- 
ments. 
The number of employees needed to runa 
complete plant varies with supervision and 
production requirements, Reports indicated 
that for a one-shift operation a body line nor- 
mally would require 6 or 7 employees and the 
end line would require about the same number, 
28 
Reports indicated manufacturing costs often 
are equal to 25 percent of the total cost of 
the: can; 
Net margins or savings may range from 14 
to 17 percent expressed as percent of ''cost of 
sales,'' depending upon efficiency of the plant, 
competency of the production management, 
and local selling prices. 
Two and one-half to three years is consid- 
ered a reasonable period for a plant to pay 
for itself, 
POSSIBLE DIFFICULTIES 
Slightly less than 50 percent of the pro- 
cessors interviewed believed there were only 
very limited or no opportunities for coopera- 
tive manufacture. Difficulties anticipated in 
establishing a cooperative manufacturing plant 
for containers are reflected in table 19, The 
principal problems they mentioned were; 
It might be difficult to develop enough volume 
of standard sizes and types of containers to 
make the manufacturing process feasible. If 
one processor does not have the volume, then 
some type of organization or agreement must 
be made between two or more processors, 
such as that between the two owners of C T 
Supply Company, Inc, Also, special federations 
of cooperative processors, such as Citrus 
Central in Florida and Consolidated Agri- 
cultural Industries in California, could pro- 
vide the leadership and organization for entry 
into container manufacturing. 
The difficulty of getting processor managers 
to work together and to participate tothe same 
degree as to benefit from economies of scale 
was considered important by some people, 
Another difficulty anticipated by processors 
is competition, from large, established com- 
panies in the container industry, Several major 
cooperative processors have made, or are in 
the process of making, long-term purchasing 
agreements with private manufacturers, . 
Private industry has respondedto these agree- 
ments by building plants in the local areas, 
primarily to serve their accounts. 
