YAKIMA VALLEY FRUIT GROWERS’ ASSOCIATION 
supplies and distributes them to the dis- 
tricts; it maintains an inspection depart- 
ment to secure absolute uniformity in 
grade and pack throughout the valley; it 
takes care of all purely inter-district mat- 
ters, and looks after the organization of 
new districts; it distributes all returns 
to the growers and makes the deductions 
in payment of supply accounts. 
Functions of “Central” 
The North Pacific Fruit Distributors 
are general sales agents for the associa- 
tion and handle all carload shipments. 
Supplies 
Thus far the association has attempted 
to handle no supplies for its members 
except such as may be classed as strictly 
orchard supplies, sprays, boxes, paper, 
nails, etc. Contracts and purchases are 
made by the sub-central and distributed 
through the districts. Each district is 
held responsible for all supplies fur- 
nished through it to its members. Sup- 
plies are sold to members at current re- 
tail prices and charged to the district at 
cost price plus a charge intended to cover 
sub-central’s expense in handling the 
business. The balance of the difference 
between cost and sales price thus passes 
into the hands of the district, where it 
may be disposed of as the members of 
each district may direct. Pro rata deduc- 
tions are made from the crop returns of 
members in payment of their supply ac- 
counts. For the two seasons of 1912 and 
1913 the association handled $360,000 
worth of supplies, paying for them at or 
before maturity. The business methods 
thus indicated and the large amounts pur- 
chased make it possible for the associa- 
tion to buy at very low prices. 
Financing 
In the inception of such a co-operative 
enterprise, perhaps the most serious prob- 
lem to solve is that of finance. Organiza- 
tion and promotion work is costly; much 
of the work each year must be done be- 
fore the shipping season begins and until 
that time no revenue is available. More- 
over, at all times a working capital is 
essential, and co-operative enterprises 
have often found it difficult adequately 
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to meet this need. At the outset the 
association met the difficulty in two 
ways: First, the membership fee of 
$100 was divided between the district 
and the then central, thus furnishing to 
central an immediate fund for initial 
expenses. In April, 1912, this rule was 
changed and since that date central has 
received no part of the membership fee. 
Second, in order to furnish the new or- 
ganization with a basis for credit, each 
early member gave his note to the asso- 
ciation in an amount equal to $10 for 
each acre planted to fruit. These notes, 
known as “acreage notes,” were given to 
be used as collateral under conditions 
laid down in the by-laws. In April, 1912, 
the giving of these notes was discon- 
tinued and in February of 1913 the asso- 
ciation, having no further need of the 
notes which had been already accumu- 
lated, and which aggregated in amount 
over $60,000, cancelled and returned 
them to the makers. At the time these 
changes in the financial plan were made, 
a plan was adopted which makes provi- 
sion for the financing of the association 
in a far more permanent and satisfactory 
way. Under this plan, a box deduction 
is made from the returns of all fruit 
shipped through the association; for ap- 
ples and pears, 5 cents a box; for 
peaches and prunes, 11% cents a 
box, and for other fruit  propor- 
tionate amounts; those deductions are 
considered as a loan to the association 
and are represented by notes, due three 
years after date with 4 per cent inter- 
est coupons attached. The first two sea- 
sons’ business has brought into this sur- 
plus fund the sum of $85,000, this with 
another year’s accumulation will provide 
a sufficient working capital, furnished by 
and belonging to the growers in the exact 
proportion in which they from year to 
year make use of the privileges of the 
association; in case they for any reason 
sever their connection the capital con- 
tributed by them is automatically re- 
turned to them as the notes mature. 
The current running expenses of the 
association are met by the usual system 
of charges upon fruit handled. 
