Iowa County democrat. [volume] (Mineral Point, Wis.) 1877-1938, 1921-06-30
MUST LEAD THEIR
OWN ENTERPRISES.
Farmers Can Profit by History OF
Three Cooperative Concerns
That Failed.
BY w. klRScH,
Wisconsin Division CT Markets.


been many attempts among Wisconsin
farmers to organize cooperative pack
ing plants. Livestock raisers felt that
the large packing concerns paid them
less than their products deserved. By
cooperating in the packing business,
the farmers hoped that they would re-
ceive better remuneration for their
product by cutting out the local COM
mission dealers, the stOckyard charges,
the commissions to the dealers at the
market place and the freight charges
on the reshipment of meat. However,
cooperative packing plants have not
been successful in Wisconsin and have
considerable losses.
The first cooperative packing plant
project undertaken in this state was
at La Crosse. This plant was not
built by farmers. In the beginning it
was owned and operated by private
packing company When it was sold
to the farmers it was Ia years old.
The building was unsatisfactory and
little of the machinery was disable at
ALL This plant began business In
June, 1914, and closed down in De-
cember, 1916. For the $265,OOO SUBJ
scribed there was left practically
nothing except a dilapidated building,
and the machinery which was practi-
cally worthless.
The history of the cooperative
packing plant at Wausau is a differ
ent one. 1t was built by the farmers
and was originally capitalized for
$25O,OOO. The board of directors and
the manager were all competent men.
The volume of business during the
first year was $S5OOOO. The plant
handled 1859 cattle, 1851 hogs, 5,868
calves and $50 sheep. They aimed to
pay the farmer 10 cents or Is cents
per hundredweight more than Chicago
prices would net him. The manage
ment of this cooperative plant was
efficient and all went well until COM
petition set in from the big packers.
After this it was not long before the
Wausau packing plant was In down.
ward movement The profits were cut
considerably, and the loss became a
little greater each year and the COM
pany could not make expenses. The
company was reOrganiZed as
straight stock corporation. The out
standing cooperative stock was cam
celled and new stock issued in place
of it. This plant is still operating as
a stock corporation.
Another unsuccessful packing plant
was the Madison cooperative packing
plant. 1t was not promoted by farm
ers but by outside people who were
not interested in the packing plant
themselves Farmers generally bought
stock and as soon as a sufficient
amount of it was sold the promoter
left. The stockholders were scattered
all over the state and in most cases
did not know each other. They also
knew very little about the cO-opera-
tive packing plant except the fact that
they owned one or more shares.
This cooperative packing plant was
short of working capital. When they
started operations they had about
$6OO,OO0 They spent approximately
$3.50, 600 for their plant and there were
outstanding notes for the stock they
had sold to the farmers. The notes
came in slowly and consequently they
did not have bulk of money to go
ahead with. Then they were unable
to hold their products until finally
cured and had to sell them on close
margins to the great packers, who
completed the curing and reaped the
major profits. The plant was sold to
a private concern for 100000.
The story of these three cO-Opera-
tive packing plants shows that coop
Grafton can succeed only under GER
tain conditions. To be successful, q
cooperative association must be well
managed and well financed and 1t
should be organized by the farmers
themselves and not by outside promo
tiers whose interest lies in the selling
of the stock rather than in the sue
cess of the organization. An impor-
tant thing to take into consideration
is that not every line OF the farming
business lends itself equally well to
cooperation. Cooperative creamer1ea
have been very successful in WiscOn-
sin while cooperative packing plants
have generally failed. 1t must be re-
membered that the cooperative pack
ing plants have to compete with the
centralized packing companies.
Cooperation in agriculture should,
therefore, start in those lines where
there is little competition from CEN
tralized monopOlies. When co-opera-
ton among farmers has developed
and when their mistakes and failures
have shown them what they have TO
guard against, they will be In posi-
ton to undertake cooperative enter
prises on a large scale and to compete
with these centralized companies.
"Perfect Seed Circle"
County Agent A. c. Murphy OF