Large-Scale Organization in the Dairy Industry

R. K. Froker, A. W. Colebank and A. C. Hoffman

No 324060, Miscellaneous Publications from United States Department of Agriculture, Economic Research Service

Abstract: Excerpts from the report Introduction: One of the most important post-war developments in the dairy industry has been the tendency toward large-scale organization in the manufacturing and distribution of dairy products. This tendency is exemplified by the big dairy corporations, the meat packers, the grocery chains, and a number of dairy marketing cooperatives. More than any other factor, the rapid growth of such organizations during recent years has altered the entire marketing structure for dairy products and has affected the methods of their handling at all points in the distributive process. This study shows that concentration of control varies considerably for the different dairy products. The three largest handlers of each product distribute approximately 21 percent of the total supply of butter, 63 percent of the cheese, and 44 percent of the condensed and evaporated milk. No single firm has any very large percentage of the total volume of milk that is consumed in fluid form, but it is not uncommon for two or three handlers to distribute from one-half to two-thirds or even more of the supply in a given city market. It is impossible to obtain a direct measurement of the effects of large-scale organization on the marketing costs and margins of dairy products. But it is significant that the marketing spreads for condensed and evaporated milk (to which mass methods have been most completely applied) have narrowed steadily in relation to those of other dairy products. In addition to these major topics, the writers have sought to bring together what information is available relative to other phases of the problem. Among these are the financial tendencies shown by the dairy companies, their sources of supply and sales outlets, the importance of patent control in the dairy industry, and the relationship of mass distribution to the producer-cooperative movement.

Keywords: Agribusiness; Financial Economics; Industrial Organization; Labor and Human Capital; Livestock Production/Industries; Marketing; Research and Development/Tech Change/Emerging Technologies (search for similar items in EconPapers)
Pages: 79
Date: 1939-07
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uersmp:324060

DOI: 10.22004/ag.econ.324060

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