The Kimball graphic. (Kimball, Brule County, Dakota [S.D.]) 1883-1905, 1904-01-22
TAlE KIMBALLGRAPHIC
cLArE TlNAN
Official Paper Of the City and County
The Creamery Business

OAASy a"AAA OAA ~ AtoO
time the company passes a dividend.
It is to be presumed that there are
those who will say: it can afford to
in the light of former heavy dividends.
Very likely-and it isn't likely that
there will be dissatisfaction expressed
on the part of the stockholders. On
their part they can, in turn, say that
had they not received some pretty
liberal dividends it would take some
tall figuring to show where they are
coming out even for their investment
in a creamery, to which every man
had the same access and same privi-
leges and his milk turned into butter
and sold for him at no more cost than
his neighbor who had 500 tied up in
the concern.
The history Of the creamery business
in Minnesota and Iowa has shown
that five cents per hundred pounds Of
milk will no more than keep up the
plant, add improvements as needed
and pay 10 per cent interest on the
stock. If for any reason the plant
should shut down permanently the
building ana machinery won't bring
over ten or fifteen per cent on the
original cost.
Occasionally a creamery is found,
like the Kimball creamery in its best
days, when the milk receipts are so
large that the five cents per hundred
brings in a large amount Of money,
and which, with small expense fer re-
pairs-everYthing being new-soon
accumulates a handsome surplus, but
a surplus that is sure to be needed in
time.
1t would be well for the Kimball
creamery today if it had some of that
surplus in the treasury instead of in
the pockets of the stockholders, man
OF whom today are out of the country
and with no intesest IN it or in any Of
its institutions or industries.
The stockholders thought best last
year to reduce the levy on milk from
five to three cents per hundred, be-
]ieving that it would not only bring
in sufficient revenue to keep up the
plant and pay at least the stipulated
10 per cent interest on the capital
stock but satisfy some of the non
stockholders who were not patrons.
Had the creamery run all through the
fall and up to the present time with
the average amount Of business OF
former years, it is likely that there
would have been enough funds on
hand to paid the interest on stock.
But it didn't, and any one Of a dozen
things are liable to happen anytime to
cut down the revenues.
When the stockholders meet next
week they will undoubtedly be forced
to raise the levy on milk back to five
cents, as the days for large milk re-
ceipts are over. If it should prove
otherwise it is a simple matter to
distribute any surplus back to the
patrons pro ratio in proportion to the
amount of milk delivered, after pay.
Ing 10 per cent interest on the stock,
and whatever repairs have been nee.
essary to keep the plant in running
| order.
This will be fair to the patrons and
fair to those who have their money
invested in the plant.
1T would prove more satisfactory all
around if every patron was a stock.
holder, and mi to about the same eX.
tent as another. An attempt was
once made to distribute a large amount
of stock among a score or more OF
patrons not stockholders, but it was
only partially successful and many OF
those who took the stock soon dis.
posed of it. Experience has shown
that stock in a corporation is as free
to circulate as government currency
and there is no way to hold it within
any defined b~ounds-and this whether
it is worth ten cents on the dollar or
dollar and ten on the dollar. There
has been no time in the history of the
Kimball creamery but what a control
ling interest could be bought at less
than the par value Of the stock, ever
when it was paying big dividends
Wise investors saw that the business
was far from being on a sure founda,
tion.
The reduction OF the sinking fund
levy from three to five cents had no,
the slightest effect on the business Q,
the creamery for the simple reason
that the two cents reduction did not
amount to but two-tfths OF a cent on
the cost Of manufacturing a pound O.
butter. The reduction means a con
siderable lost to the company in tht
aggregate, but when distributed
among fifty to one hundred patron.
does not NEAR enough saving to then
to be of sufficient Importance in war.
ranting their patronage or Withdrawal
When you look at the large number
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