Current sales costs 



Some measure of sales and promotion 

 costs is important in any attempt to 

 develop a joint marketing program. Such 

 a program needs financing, and such 

 financing must come from the firms using 

 the service. Therefore, it is important 

 to know what member firms have been 

 accustomed to paying for selling and 

 promoting their products. 



An attempt was made in this study to 

 estimate the average costs of selling and 

 promotion incurred by cooperative proc- 

 essors. Replies to this portion of the 

 questionnaire were such that costs can 

 be presented both as ranges and as per 

 unit averages. 



Interested firms replying to this 

 portion of the inquiry reported a slight 

 difference in costs depending on the prod- 

 ucts handled, as follows: 





Brokerage costs 



Advortlslne costs 



Product group 



Percent of 

 sales 



Per case 

 equivalent 



Percent of 

 sales 



Per case 

 ecyulvalent 



Vegetables 

 Fruits 



(Range) (Average) 



3.0 to 6.5 



2.7 to 5.0 SO. 13 



(Range) (Average) 



to 3.5 



to 10.0 SO-^6 



Twenty- eight firms advertised their 

 products during the year imder review. 

 Their aggregate shipments in 1953-54 

 were 32 million cases and they spent 

 just under $2 million in advertising. 



Current marketing problems 



Any program designed to coordinate 

 the selling activities of a group of proc- 

 essors must solve, at least in part, the 

 marketing problems of its constituents or 

 it will fail for lack of support. 



The first step in solving any problem 

 is to know what the problem is. To this 

 end, cooperative processors were asked: 

 " What do you consider to be your most 

 important marketing problems? " 



Most respondents answering the ques- 

 tion listed two or more. To reduce the 

 answers to manageable size, they were 

 grouped into broad major categories. 

 Table 4 lists these categories and the 

 number of firms whose problems fell 

 into each. To measure the nature of the 

 difference, if any, between processors 

 interested and those not interested in a 



Table 4. - Major market in^ problens of cooperat ive processors interested and not inter- 

 ested in a joint sales agency, 1953-54 



Problems associated with: 



Number of firms 



Among those 

 interested 



Among those 

 not interested 



18 



15 



13 



9 1 



9 10 



6 



6 



5 



4 



3 



Brand competition and acceptance 



Maintenance of full and adequate market coverage 



f^ustoirer buying practices and oreferences 



Transportation 



Achieving a profitable relationship between 



costs and returns 

 f\iality control and quality competition 

 Financing distribution 

 Warehousing and storage 

 Consumer use, demand, and preference 

 Excessive fluctuations in demand, supply, 



and price 

 Paw product supply 

 Mi seel laneous 



12 



