38 BULLETIN 1237, U. S. DEPARTMENT OE AGRICULTURE. 
There was also an immediate saving in marketing costs. The 
average commission charge before the organization of the exchange 
was 10 per cent, although higher and lower rates were mentioned. 
As quoted by Lloyd, the actual cost of selling through the exchange 
in 1895 was about 4 per cent, a saving of a full 850,000 this year to 
growers, (i) In this connection, Mr. Woodford makes the following 
statement : 
Then (immediately before the formation of the exchange) the growers paid the 
California shipper 7 to 10 per cent on the gross proceeds for selling the fruit. 
Now a better service is open to all growers for less than 3 per cent. 
For the year ending October 31, 1922, the cost of district exchange 
and exchange service was 1.89 per cent of the delivered value of the 
fruit, or 2.27 per cent of the f. o. b. returns, according to the report 
of the general manager. Savings in packing and marketing costs 
have, therefore, been a very important contribution to the industry. 
Although costs, measured in cents per box, have increased very 
materially in the past few years, the percentage ratio of marketing 
expense to gross proceeds has not been increased. The marketing 
expense of the exchange system, including California Fruit Growers 
Exchange costs, advertising, and the expenses of the district ex- 
changes, averaged slightly less than 3 per cent of the f. o. b. value 
of the fruit for the five-year period 1917-1921. Out of the average 
dollar paid for oranges by the consumer for the period, approximately 
40 cents went to the grower, 8 cents to the local packing house, 1 
mill to the district exchange, slightly over 1 cent to the California 
Fruit Growers Exchange for advertising and selling, 18 cents for 
transportation and refrigeration en route, 8 cents to the jobber, and 
25 cents to the retailer. 
Out of the average dollar spent by the consumer for lemons during 
the same period, 33 cents went to the grower, 11 cents to the local 
packing house, 1 mill to the district exchange, slightly over 1 cent to 
the central exchange, 14 cents for transportation, 9 cents to the 
jobber, and 32 cents to the retailer. Expressed in another way, 
the grower received about five times as much as the cost of packing. 
or the jobber's margin, and a little over twice the cost of advertising 
and selling, and for transportation. The retailer's margin was two- 
thirds that of the grower for oranges, and 97 per cent as much for 
lemons. 
The figures quoted above represent averages for the five-year pe- 
riod. Actually, however, at any given time the percentages varied 
considerably from these figures. 
COOPERATIVE PURCHASE OF SUPPLIES. 
As early as 1897 a resolution from the Ontario Fruit Exchange 
requested that the then Southern California Fruit Exchange take 
immediate steps to secure commercial and other fertilizers for ex- 
change members at wholesale rates-" but the cooperative purchase 
of supplies through the exchange agency did not become a reality 
until 10 years later. 
Following the San Francisco fire in April, 1906, there was a verv 
large demand for lumber throughout California for use in the rebuild- 
ing <>f that city. Although, for the most part; only the upper grades 
• Minute; of the board of directors, Southern California Fruil Exchange, June 22, 1897. 
