XV. Methods of Sale in the United Kingdom. 73. In London the dried fruit trade (in currants, raisins, sultanas, and figs) is controlled by the " London Dried Fruit Trade Association "-an Association formed for the protection of the interests of its members. Similar Associations exist in Liverpool and Bristol, each having their own regulations, but all three are in close touch with one another. 74. The London Dried Fruit Trade Association is itself a combination of three subsidiary Associations : (1) The Importers' Association. (2) The Brokers' Association. (3) The Dealers' Association. 75. Although in fact the Importers' Association is an Association of four other Associations, it is substantially correct to describe it as an Association of about 100 Importers. Its members undertake to act only as importers and to sell all fruit which they handle through members of the Brokers' Association to members of the Dealers Association. 76. The Brokers' Association consists of 13 member firms who undertake to act only as brokers and to sell fruit belonging only to members of the Importers' Association. They may sell only to (a) Members of the Dealers' Association. (b) Outside buyers who buy fruit solely for speculation, or merchants who buy for speculation. (c) "Privileged buyers." Outsiders who buy solely for speculation must resell through members of the Brokers' Association. As a rule no goods pass. The list of "Privileged Buyers" consisted originally of those firms with whom brokers insisted on maintaining direct relations when the Association was formed, over 30 years ago. It now contains the names of about 13 firms-some of whom are large consumers of dried fruit. At the same time some other equally large consumers have been unable to become "Privileged Buyers." These latter firms, have, therefore, the alternatives of buying their supplies in the country of origin and making all necessary subsequent arrangements for shipment and importation, or of buying from members of the Dealers' Association. We are informed that only the very largest consumers find it worth while to have their own buying agents abroad and that therefore most firms have in practice no choice but to buy from members of the Dealers' Association. 77. At the time of sale from importer to dealer, brokers charge importers 1 per cent. brokerage and dealers per cent. brokerage, making a total of 2 per cent. Besides this charge there is a "draft allowance of 2 lbs per cwt. which means in effect that when an importer sells 112 lbs. of fruit the dealer pays for 110 lbs. With this matter we deal in paragraph 162 of one main Report. 78. Although there are no Association rules which forbid brokers to hold free auctions, nearly all sales are in fact conducted by private treaty, with the exception of sales of Valencia raisins. These are very frequently sold by public auction at which, in practice, we are told, there are few or no buyers except members of the Dealers' Association. 79. The Dealers' Association contains 36 member firms, all of whom undertake to buy all their requirements of the dried fruits mentioned above only through members of the Brokers' Association and not to make any direct importations. Dealers sell to secondary wholesalers or to the larger retailers. We are informed that there is no example of a dealer who deals in dried fruit alone. In every case dried fruit is merely one of the commodities which the dealer sells to his customers-a point of some importance, since a customer may on occasions decide that it is preferable to put up with some inconvenience in the supply of one article rather than dislocate his channels of supply for many other articles. 80. We discuss the larger aspects of these Dried Fruit Trade Associations in paragraphs 149 to 157 of our main Report. 81. The Co-operative Wholesale Society is a very large purchaser of dried fruit. We have been informed that this society purchases 75 per cent. of its dried fruit supplies direct from the country of origin. The method which it adopts is to send to Greece and to Turkey representatives of the Society as buyers where they bargain with the packer for the purchase of lines of currants or of sultanas. The Society advances in exchange. for bills of lading up to 85 per cent. of the agreed purchase price. the balance being remitted as soon as the bulk has been approved after the arrival of the goods in the United Kingdom. Such purchases direct from the country of origin are of course, exempt from the restrictions and charges of the Dried Fruit Trade Associations in the United Kingdom. XVI.-Prices Structures. 82. We attach detailed price structures from the point of primary sale in the United Kingdom back to the point of production in respect of Australian sultanas and currants. It must be remembered that these price structures are merely indicative of the results which are being obtained by producers and are necessarily only approximations. With the main items of the costs of distribution we deal in our main Report. AUSTRALIAN SULTANAS SOLD IN LONDON. From point of Primary Sale in United Kingdom to Producer. Packing charges ... †Costs of cultivation (including depreciation, rates, taxes, horse feed, and repairs, manure, spraying, harvesting, labour, etc.) ... ... Net estimated return to grower ... *The Agent's Commission varies up to 5 per cent. on the f.o.b. value. We here take 4 per cent. on the landed value as an average figure. The cost of cultivation of sultanas on the basis of 1 ton per acre has been variously estimated at from £33 to £38 per ton (i.e., an average of 35s. per cwt.). This scale of production (1 ton per acre) is a good average return. An increased output per acre in a specially favourable year would reduce the cost of cultivation per cwt., whereas in an unfavourable year the cost would be materially increased. AUSTRALIAN CURRANTS SOLD IN LONDON. From point of Primary Sale in United Kingdom to Producer. ... ... ... ... Packing charges... +Costs of cultivation (including depreciation, rates, taxes, horse feed, and repairs, manure, spraying, harvesting, labour, etc.) Estimated loss to grower ... ... ... ... ... ... ... ... 23 2.55 66.3 (see above)... XVII.-Packing in Cartons. 83. At the present time the bulk of the dried fruits sold in the United Kingdom is purchased by the consumer by the loose pound. An exception exists in the case of the "Sun-Maid " products which are marketed in cartons bearing the name of the brand. Sale in cartons in this way has formed the basis of an extensive advertising campaign for the fruit. A certain amount of Australian dried fruit has recently been sold packed in a similar way. *The Agent's Commission varies up to 5 per cent. on the f.o.b. value. We take 4 per cent. on the landed value as an average figure. †The cost of cultivation of currants on the basis of 25 cwts. per acre has been variously estimated at £23 to £32 per ton (i.e. an average of 27s. per cwt.). This scale of production (25 cwts. per acre) is the normal return. In favourable years the productivity of some estates may rise to 40 cwts. In such cases this would reduce the cost of cultivation per cwt. on particular estates. 84. The advantages of such a method of sale are obvious. It enables the purchaser to recognise the fruit without difficulty and it forms an admirable basis for an advertising campaign. The drawback consists in the fact that fruit packed in small cartons is apt to deteriorate rather more quickly than that packed in large cases. Further, there is always the possibility that a single carton may be overlooked in the retailer's shop for a long period and ultimately sold, with the effect of creating in the mind of the purchaser the impression that this is a representative sample when, in fact, it has probably become grubby" or sugared" through its long retention. 66 85. Nevertheless, we regard the advantages of the carton packing of a certain amount of Empire dried fruit as sufficiently great to outweigh the possible disadvantages. Packing should, however, be carried out in the United Kingdom after the fruit has been imported in bulk, as a long period of transport through the tropics in cardboard cartons would have a deleterious effect. We, therefore, recommend that Empire dried-fruit producers should arrange for a certain amount of their better class sultanas and raisins to be sold in half-pound and one-pound cartons in the United Kingdom, but that such packing into cartons shall be carried out in the United Kingdom and not in the producing country. We further recommend that these cartons shall bear an indication of the country of origin. XVIII.-Identification. 86. All Empire dried fruit imported into the United Kingdom is packed in boxes clearly marked with the name of the country of origin. Boxes containing fruit from Greece, Turkey, and Spain are not necessarily so marked. We are informed that anyone in the trade can state the origin of a particular consignment of fruit merely by an examination of its general appearance. Apart from this, however, the absence of the name of an Empire country on the case is conclusive evidence that the fruit is of foreign origin. In the case of "Sun-Maid " products, as already stated, the trade mark" Sun-Maid " appears on the box in which the fruit is packed and also on the individual carton when the fruit is sold packed in this form. 87. As we have already stated, except in the case of "SunMaid" dried fruit, and to a small extent certain Australian sultanas, dried fruit is sold by retail grocers by the loose pound. It is, therefore, frequently removed from the original box when exposed for retail sale in the grocer's shop, and the consumer has no way of identifying the origin of the fruit, except in the case of the carton packs. As already pointed out, however, the retail grocer is always in a position to state whether the fruit he offers for sale is of Empire or" Foreign" origin. We, therefore, recommend that in the case of dried currants, raisins, and sultanas, the retailer shall be required to distinguish between 66 |