Evening star., 1913-02-27
COOPERATIVE MARKETING.
V-THE MIDDLE MAN.
By Frederic J. Haskin.

When the statement is made that the
farmer who breeds the stock and fattens
1t and who grows the grain and other
| produce gets less than half OF the price
4 the consumer pays at the corner grocery,
and when that Information is not mere
surmise but q conclusion based upon
careful statistical inquiry, 1t becomes
highly interesting thing to the consumer
| to get a glimpse at the processes by
which his dollar becomes a flfty-cent
piece.
| An Interesting picture OF how the
process moves forward step by step is
afforded by a study Of the middlemen in
the beef industry. one Of the most highly
| organized of all our marketing Industries.
| In considering these various steps. how
ever. 1t is we'll to keep In mind that in
some stages of the procedure unusual
economies have been effected and that
| but for these 1t is hard to tell where
| the prices the consumer would be called
upon to pay for his steaks and roasts
would end. For instance, by slaughtertng
close to the cattle supply. the saving
| effected in the transportation Of the
dressed beef rather than Of the cattle on
the hoof becomes substantial constdera-
| ton. Seven carloads of live cattle make
| beef. The difference in the freight rate
on live and slaughtered steer between
Kansas City and New York amounts to
about $3.50 per head. In slaughtering on
| a large scale and the consequent utiliza-
| ton OF the by-products a saving Of large
| proportions is affected.
| When the Texas farmer sells his stock
cattle a charge Of perhaps a dollar a
Converted Into Fat Cattle is made
on Ranches in the North. buver m for
the service. Then it costs about 15
cents head to drive them to the rail-
road. $3.50 head freight to Montana and
| the Dakotas 20 cents a head for feeding
en- route. cents head for attendance
and 10 cents a head for driving from the
| station to the ranch, or about 1886 per
head, all told. On the northern ranch
| this stock cattle must be converted into
| fat cattle, and, of course, the rancher
who does 1t Is not in the business for
the pleasure there is in 1t. He probably
| adds something to the value of the steer
besides the cost Of putting on the surplus
| meat. At any rate. it costs more to get
the fattened steer to and through the
| stockyards at Chicago from the northern
| ranch than it did to get him through the
first stage of the journey to market. The
whole course Of transportation from
Texas to Chicago adds a cent a pound to
| cent and half a pound to the value OF
the live steer by the time he reaches the
packer. The profits of the buyers and
other middlemen between grower and
packer probably bring the total up to =
cents pound
The packer, perhaps, pays cents
pound for the steer on the hoof. He
usually sells the dressed beef at a mar
gin of about 3 cents above the on-the-
hoof price. figure that would mean
heavy loss to him except for the by
products. To illustrate, a steer which
would cost him $50 on the hoof. would
net him less than fifty dollars worth of
dressed beef. If the packer were to make
only ! cent a pound on the cattle he
dresses. the big packers would be making
Sl2o,OW,UD year, or more than a bill
lion dollars every decade and of course
no one claims that they have made that
much.
After the beef is dressed, there is the
shipping charge for transportation and
I c n &.
Charges Made for Shipping W h G
and Icing Dressed Beef.
another cent to the cost. Then it goes to
the retail butcher. If the beef has cost
the packer cents on the hoof it will
cost the retail butcher around 10 cents a
pound wholesale. A cent pound more
on the hoof will increase the price of
dressed beef about a cent and a half
pound. Out of the twelve-cent-a- pound
carcass the retailer will probably cut the
consumers roast at something under 80
cents
Inquiry among retailers shows that one
OF their main expenses Is that of de-
livery. manager of a big chain of
stores. which sell for cash and leave the
matter Of delivery to the consumer, de-
clares that the reason their prices are
about 20 per cent under those Of the
other grocers Is because they effect that
saving on delivery alone. For steak that
an ordinary grocer sells at 25 cents
pound these stores charge 20 cents.
From this it will be seen that the deliv-
cry wagon probably figures more than
middleman's profits in the sales of
produce to the consumer. Based on the
assumption that the farm produce sold
in this country does represent $4,000
100000 to the consumer. and the further
assumption Of this manager that the re-
| tailers' delivery wagons are responsible
| for % per cent of the consumers GRO
Gerry bill, that scandalous institution. the
delivery wagon, costs the American con-
suIler annually enough to build the Pan