ECONOMICS OF FRUIT MERCHANDISING 
ber and November, to sicken and disgust 
the consumer and kill the demand, while 
Jonathans and Grimes Golden are being 
ignorantly held in storage. 
Educating the Consumer 
So, by this plan, the consumer also will 
have been educated by us, whose business 
it is to educate him, and it will have been 
done right. The effect would be lasting, 
as we will have made a friend of the 
consumer—a co-operator. 
This is my idea of co-operation. Co- 
operation that is intelligently construc- 
tive, not destructive. Destroy the abuses 
as we find them; yes. But let us be sure 
we have found them first, or we may 
destroy something that is inherently val- 
uable, and only needs a little sympathetic 
co-operation to contribute to our needs. 
The progressive methods that I have 
proposed will cost money, assuredly. But 
spread out over a large volume of busi- 
ness, with growers co-operating and sup- 
porting, the per package cost would not 
be high. Three cents per box would do 
a very great deal; 5 cents per box would 
do more, and in my judgment would re- 
turn in increased profits many fold. Our 
industry has reached a point where such 
methods are not an extravagance, not a 
luxury, but a necessity. We have got to 
spend money to make money. 
It may not be a violation of the pro- 
prieties if I illustrate the principles 
which I have sketched by referring to the 
institution with which I am connected— 
the Northwestern Fruit Exchange. Or- 
ganized at the beginning of the shipping 
season of 1910, the exchange has expend- 
ed $150,000 in the development of a sys- 
tem of merchandising, specifically adapted 
to Northwestern fruits. We firmly be- 
lieve in the principle of f. 0. b. sale, for 
many valid reasons. First, it is the ac- 
cepted and proven system by a great ma- 
jority of the successful fruit industrials. 
The United Fruit Company sells 75,000 
cars of bananas annually on a f. o. b. 
basis strictly. The California Vegetable 
Union, American Cranberry Exchange 
and scores of others, the most successful 
in their several fields, all operate on this 
principle. We contend that the fruit is 
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worth more, f. o. b. shipping point, than 
at any other point; worth more intrin- 
sically; worth more as an article of mer- 
chandise for the merchant wanting it for 
immediate sale; worth a good deal more 
to the merchant wanting it for storage 
purposes. It would therefore seem that 
the shipping point is the place where it 
would be most desirable for the grower 
to have his market established. At that 
point we can absolutely guarantee, if we 
are careful enough, that the fruit is 
strictly first class. We cannot do that— 
absolutely—24 hours after it has left 
shipping point, but we can say everything 
good about it while it is at shipping point 
that could possibly be said about the 
fruit, and say it truthfully. Again, if 
the market is established f. o. b. it means 
the crop is a cash crop to the fruit grow- 
ers. With interest rates ranging from 
8 to 12 per cent, that in itself is a big 
item. As a matter of fact, the exchange 
made a record for the entire season of 
1911 of an average of 24 days between 
date of shipment and date of full pay- 
ment for every car handled during the 
season. Furthermore, during the season 
of 1911 the exchange sold for one asso- 
ciation that I could name nearly 75 per 
cent of its entire output prior to the har- 
vest of the fruit from the trees, and 99 
per cent of the whole f. o. b. shipping 
point. 
Sales Department 
Another very important feature of our 
problem which shows the great need of 
co-operation is in the operation of the 
gales department. The exchange believes 
that there is only one system which is 
practical in a large sales operation of 
perishable fruits, namely, resident sales- 
men. The value of any commodity is 
based on supply and demand. [In order 
to obtain maximum value, the sales man- 
ager must have at his daily command the 
whole demand of all the markets of the 
world. Traveling salesmen as a main 
system is expensive and impractical. I 
know of one large producer who tried 
that system, and he says it cost him 
$200 per car to sell his fruit at unsatis- 
factory prices. The trouble is that the 
