The Food Marketing Industries: Recent Changes and Prospects

Forrest E. Scott and Stephen J. Hiemstra

No 319971, Miscellaneous Publications from United States Department of Agriculture, Economic Research Service

Abstract: Rising consumer incomes and the movement of people from farms to cities have increased the demand for processed foods. Technological innovations have made these foods available at competitive prices. As a result, the output of processed food products in this country is growing faster than population. Greater average capacity per plant has enabled the increased output to be produced by a declining number of food processing plants and firms. Adoption of new technology has been a major force in reducing the number of plants and increasing the average size of plant. Many types of wholesalers move products from farmers to processors and retailers. These include firms that assemble and handle raw farm products, merchant wholesalers (including both general and specialty line grocery wholesalers), manufacturers' sales branches, brokers and agents. Assemblers of farm products increased their sales and the number of establishments from 1954 to 1958, after a decline from 1948 to 1954. In the wholesale grocery field, sales of general line merchant wholesalers affiliated with groups of retail food stores more than doubled from 1948 to 1958. This trend contrasts sharply with the decline in sales of the nonaffiliated general line grocery wholesalers. Total sales of grocery stores rose by three-fourths from 1948 to 1958, but the number of stores dropped by more than a fourth. Both chain and independent grocery stores decreased in number. The number of grocery stores with an annual sales volume of less than $100,000 declined sharply, but those grossing more than $1 million multiplied fourfold. Chains with 11 or more stores increased their share of total grocery store sales to 44 percent in 1958, up from 34 percent in 1948, and 33 percent in 1939. The most rapid growth was made by chains with 100 or fewer stores. In 1958 about two-fifths of total grocery store sales were made by stores that were members of retail groups either cooperatively owning a wholesale house or sponsored by a wholesaler. Thus, independent grocery stores not affiliated with a wholesaler had only about a fifth of total sales.

Keywords: Labor and Human Capital; Marketing; Production Economics; Research and Development/Tech Change/Emerging Technologies (search for similar items in EconPapers)
Pages: 28
Date: 1962-02
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uersmp:319971

DOI: 10.22004/ag.econ.319971

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