Two of the cooperatives in the study dropped their auction method of 

 sales in early 1969 and another one is seriously considering such a 

 move . 



The mechanics of a successful auction require a sufficient number of 

 buyers and sellers to have the functions of supply and demand operat- 

 ing at a satisfactory price level. The buyers require sufficient volume, 

 variety, and quality of produce to warrant their continuing participation, 

 The sellers need an adequate number of buyers to bid up produce at a 

 price in line with the quality of each lot going through the auction 

 block. 



Although some of the New Jersey firms are still realizing net margins 

 from their relatively small auction business, most of the aii^*:ions 

 show a downward trend in volume and savings over the past decade. 



In 1969 three of nine fruit and vegetable marketing firms in New 

 Jersey handling some produce on auction dropped their auction business. 

 One firm went out of business while the other two shifted to a carlot 

 sales program. 



An eventual reduction of from six to two auctions could best assure 

 both buyers and sellers participating on the auction block a more 

 economic and efficient marketing operation. 



A current problem to adequately deal with some of the large chains 

 and other types of big buyers is attributable to the uncoordinated 

 market structure in the State. Fresh fruits and vegetables are 

 sold by many small cooperatives, noncooperative firms, brokers, 

 and individual farmers who market too limited a volume and variety 

 of produce to attract many of the large buyers o 



Furthermore, in a market structure with many sellers and few buyers, 

 sellers are at a distinct disadvantage because they compete against 

 each other for the same buyer or buyers. 



There is need for a strong cooperative carlot sales program featur- 

 ing volume, variety and quality of produce in addition to the auction 

 method of selling. 



11 



