Highlights 
Definite possibilities exist for cooperative 
processors of fruits and vegetables to procure 
their containers and other packaging supplies 
on a cooperative basis, Potential savings 
appear to be greater for cooperative manufac- 
ture than for cooperative purchase ofthe prin- 
cipal types of containers, 
Savings of 14 to 17 percent appear to be 
possible from manufacturing metal cans if a 
substantial volume--12 million or more of 
the commonly-used large sizes and 50 million 
or more of the smaller sizes--can be produced 
annually. Savings of 5 to 10 percent often were 
possible from volume discounts, brokerage 
allowances, or negotiated prices for consoli- 
dated purchases. Perhaps a savings of 5 per- 
cent might be made in the fabrication and 
printing: of paperboard shipping containers. 
Cooperatives with container purchases of 
$1 million or more a year appeared to be able 
to bargain more effectively with manufac- 
turers than cooperatives with smaller pur- 
chases. This indicates many small processors 
might effect worthwhile savings by pooling 
their container purchases on a cooperative 
basis. 
Information from 76 cooperative processors 
contacted in 1965 indicated that containers and 
packing supplies were the largest single cost 
item, exclusive of the fruits or vegetables. 
Purchases averaged $1.9 million per associa- 
tion; represented 36 percent of total processing 
costs; and were equal to 22 percent of the 
sales value of processed products. 
Estimates indicated that all cooperative 
processors annually purchase about $160 
iii 
million worth of containers and other supplies 
for packing some $725 million worth of fruits 
and vegetables they market. Thus, if savings 
of 5 to 10 percent on purchases could be made 
through cooperative procurement, the total 
potential savings for grower members would 
be from $8 million to $16 million a year. 
Metal cans accounted for 68 percent of the 
expenditures for containers; corrugated card- 
board cases (including cannery cases) for 19 
percent; glass containers represented 7 per- 
cent; and other items amounted to 6 percent 
of the total. 
Cooperatives bought 92 percent of their 
containers directly from manufacturers, Serv- 
ice and price were the main reasons given. 
Processors relied on manufacturers to deliver 
containers on an "as needed'' basis. The 
cooperatives’ beginning and ending inventories 
of containers averaged 2.5 percent of annual 
purchases and peak stocks averaged 7.2 per- 
cent. 
Various forms of quantity discounts, broker- 
age allowances, and warehouse allowances 
were available to half the reporting coopera- 
tives. The most common quantity discount 
was 5 percent of purchases. Some reported 
discounts as high as 5 percent for volume, 
5 percent for brokerage allowance, and 5 
percent at year's end. The standard rate and 
terms for cash discounts were usually 1 per- 
cent within 10 days--net 30 days. 
About 80 percent of the container items 
were transported directly from suppliers' 
plants in truckloads, 16 percent were carload 
lots, and 4 percent were smaller lots, 
