and price of valement À noter sommer vipedia, 16 a pooling systems, on the part of Grape retume and accountings by reason of the fact abatorecarit & pou may get into trouble and require considerable time for final claposition. Tomeet this situation, some cooperatives set * * * opon * van enigmente based upon all available information and core the pool, laver mading, on adjustments as actual returns warrant. The type of pool employed by a cooperative will depend upon many bactors, incl veing the number and characteristics of products handled, the method of distribution, the length of marketing period. the rate and intensity of fluctuation in market values. For commodities such as celery, berries, or early potatoes, which must move to market promptly and for which rapid price fluctuations are common, a daily pool is the most practical. In other instances where potatoes, early apples, or other products are being moved to market as harvested, 3 day or weekly pools may be employed. The seasonal pool was employed for a time by some of the cooperatives handling late potatoes and then abandoned.

In any event, it is almost always necessary to include commodities of like variety, grade, and quality in the same pool, regardless of the length of pooling period. Cooperatives handling citrus fruit sometimes employ seasonal pools for oranges, lemons, or grapefruit of the same variety, giving due consideration to similarity of quality. Likewise, the apple cooperatives may operate variety pools upon a seasonal basis or for shorter terms, depending upon conditions and the preferencess of the members. Some of the citrus organizations operate a variety of pools seasonal upon a variety and quality basis, partsenson basis by varieties, or the "pick-around" basis. Under the "pick around" scheme all the citrus picked during a definite harvesting senson goes into a given pool, taking into account, of course, proper relationship of grades and varieties.

Regardless of the fact that, without pooling, it is practically impossible for cooperatives to return the same price to all members for individund sales of products of like variety, grade, and quality sold during a given period, many organizations find it impractical to operate pools beenuse of members' objections to the practice. Through the exercise by members of some voice in determining the time of sale of their products and with the understanding that the management of the cooperative will prorate orders to the membership upon a basis as equitable as possible, the members may be willing to take their chances under this plan rather than participate in a pooling system. Many of the more responsible members of cooperatives operating upon this basas virtually obtain seasonal price averages by scattering deliveries to the association rather evenly throughout the marketing season.

An occasional emergency arises for which no individual member can be held responsible, which can be met upon a thoroughly equitable basis only through some type of pool. To illustrate, during the winter of 1936 a car of Maine potatoes ran into a flood while in transit, was seized by the public health authorities, and condemned as unfit for human consumption or for use as seed. Neither the cooperative nor the individual owner of this car of potatoes could possibly have foretold its fate. It so happened that this particular shipment was included in a large pool and the loss was shared by many growers instead of being borne by an individual. Had a cooperative, a sales agency, or the individual owner made this shipment without the protection of some kind of pooling system, and had this car represented the total crop of the producer, the loss to him would have been disastrous. In this case, however, the actual owner probably never even learned the fate of the particular shipment.

With the members and directors of the cooperative association rests the responsibility for deciding whether their organization shall operate with or without the pooling system, what methods of pooling will be used, or what alternative plans for equitable distribution of orders and sales proceeds will be employed.

Some fruits and vegetables are not well adapted to any pooling system. For instance, fresh peaches from different orchards on the same date may grade U. S. No. 1, but upon a $2 f. o. b. market basis the trade will readily place a differential of from 15 to 25 cents a package upon the different "marks" because of the reputation of the individual producers. This differential is justified in many instances by actual variation in quality.

Cooperative association managers and directors should give careful consideration to the development of a practical and scientific method of pooling before deciding on the plan to be used. Unless the plan developed is reasonably fair and equitable, the members will soon discover the inequalities and will voice their disapproval.

Some Essentials for Success

ECONOMIC NEED AND DEMAND

IN N ORDER that a cooperative may succeed, there must be an economic need for its services. Caution is necessary to differentiate between the existence of the need and a demand for a cooperative. Often the need exists without the demand. Sometimes leaders with a job complex initiate movements for the formation of cooperative organizations and are successful in arousing interest among producers. It is only fair to observe that such leadership is sometimes successful

in initiating and carrying forward cooperative ventures where the need exists but where demand has been lacking.

Human progress does not come as a surging, irresistible force generated by the masses or the classes. It results from the efforts of leadership, either self-appointed or selected. Any worthwhile cause, as a rule, has to fight for every inch of ground gained and then fight to hold it; thus leaders are developed.

Being convinced that the cause is worthwhile leaders may well bear in mind that many of the inventions, reforms, discoveries, and achievements of the human race have been made after the outstanding experts and authorities of their time had definitely determined that such accomplishment was impossible. One of the first persons to mention wireless communication found himself in prison. The first trans-continental railway in this country was constructed after the most eminent engineers had determined the impossibility of such a venture.

In the cooperative field we find similar instances. The outstanding citrus cooperative in this country owes its success to leaders of vision, foresight, and ability, who dared to undertake what seemed an impossible task. They developed an organization and a program the success of which can be ranked along with that of the most outstanding commercial ventures of this age. There is a difference in the development of a commercial venture where finances and raw material can be marshalled at the will of a board of directors and the management and that of marshalling hundreds and thousands of people into an organization and getting them to provide the finances, commodities, and leadership necessary for success.

GROWER SUPPORT

To be permanently successful, a cooperative must have the loyal and intelligent support of its membership. The producers of agricultural products are ordinarily so busy with their regular duties as to make it impractical for them to become expert in other lines of activity. However, it is not unreasonable to expect that a sufficient number understand the cooperative program well enough to give intelligent direction to the operations of their own association. Often we find producers skeptical and slow to participate in the formation of a cooperative, but once they become members and enjoy a few seasons of favorable operation, they are willing to follow almost blindly the leadership of the manager and a few directors and neglect to remain posted as to what is taking place. Even directors sometimes fail to look behind the reports and recommendations of the management and other operating personnel and later wake up to learn that all is not well and that unsound practices have been followed which could have been avoided had the directors kept themselves fully informed. The statement is often made that farmers will not cooperate or

that they will not support a cooperative venture, once they have had an unfortunate experience with such an undertaking. Quite the opposite may be true. Farmers will cooperate once they are convinced that a sound and practical proposition is being presented to them. They are almost always willing to forgive mistakes and take losses and to support new cooperative ventures which seem to be sound and logical.

ADEQUATE VOLUME

The mere fact that there is large production in a given locality does not by any means guarantee that a cooperative will be able to control sufficient volume for economical and efficient operation. It is not necessary that the cooperative obtain a monopoly, always possess majority control, fix prices arbitrarily, or perform unreasonable services, but it is important that the volume be adequate to justify the overhead expense and to enable the organization to be a real factor in determining policies for the industry and in the distribution of its members' products.

Any organization of this kind has certain rather fixed expenses regardless of the volume of business transacted. It is folly to attempt to operate an association without sufficient volume to meet these expenses. As in any other line of business, there will be lean years; hence, it is well to make sure that the volume of business will be sufficient to provide reserves during favorable seasons to cover deficits incurred during less favorable times.

Producers are inclined to desert an association if it is weak as compared with commercial organizations handling the same commodity in the locality. If their association occupies a commanding position they will point with pride to its success and give it their loyal support. Many cooperatives command such positions in their respective fields and invariably their members enjoy being associated with their organization.

SOUND FINANCIAL PROGRAM

A sound financial structure is necessary for the success of any business institution. No exception can be made in the case of the cooperative. In developing such a financial structure it is well to bear in mind several fundamentals. First, the services to be performed by the organization must be well understood and provision made for the adequate financing of these services. Second, the structure should be such as to provide for ample financing upon the assumption that the organization is to have continuous existence.

Raising money is sometimes regarded by members of a cooperative as the most important part of financing. It is important, but the use made of the capital is equally important. The wise use of money not only produces results but safeguards the investment. Heavy invest

FIGURE 9.-SECTION OF A MODERN PROCESSING PLANT. Celery is taken from the field crate, stripped, washed, packed, and precooled for shipment.

ments in equipment may be necessary for handling or processing certain products in preparing them for their journey to the ultimate consumer (fig. 9); the preparation of other products may require only plain buildings and simple equipment.

The financial program of the cooperative association necessarily needs to be adapted to the specific needs of the membership in accordance with their requirements and the characteristics of the industry being served.

In general, finances required by cooperative associations should be so arranged as to meet the following needs: (1) Fixed assets in the form of land, buildings, and equipment; (2) operating expenses such as salaries, taxes, insurance, and general operating costs; and (3) reserves to meet contingent liabilities and insure the maintenance of the organization upon a sound financial basis.

Two extremes are sometimes noted in the attitude of directors and members of cooperatives toward the expenditure of money for facilities and services. On the one hand we find the ultra-conservative group, which will not permit the expenditure of sufficient funds to provide efficient and economical services; in other instances money is expended too freely without due regard for results and apparently without appreciation of the fact that the members must foot the bill. The middle ground is the safe one.

Sources of Capital

Some of the methods by which cooperatives acquire capital are the following:

(1) Sale of stock.-Associations organized with capital stock may obtain capital through the sale of such stock. Provision may be made