bls_0796_1944.pdf

78th Congress, 2d Session - House Document No. 683

U N IT E D S T A T E S D E P A R T M E N T O F L A B O RFrances Perkins, Secretary

BUREAU OF LABOR STATISTICS Isador Lubin, Commissioner (on leave)A . F. Hinrichs, Acting Commissioner

+

Operations o f Consumers

Cooperatives in 1943

Bulletin 7so. 796[R ep rin ted fro m th e M o n th ly Labor R e v ie w , Septem ber and

O ctob er 1944, w i t h ad d ition al data]

For sale by the Superintendent o f Documents, U. S. Government Printing Office Washington 25, D. C. - Price 10 cents

Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Letter of Transm ittal

U n ited States D e par tm e n t of L a b o r ,B u reau of L a b o r St a tist ic s , Washington, D . C ., October 17, 1944

The Se c r e t a r y of L a b o r :I have the honor to transmit herewith a report on the operations of consumers7

cooperatives in 1943, prepared by Florence E. Parker of this Bureau.A. F. H in r ic h s ,Acting Commissioner.

Hon. F ran ces P e r k in s ,Secretary of Labor.

ContentsPage

Summary_____ ______________________________________________ 1Local associations______________________________________________________________ 2

Operations in 1943________________________________________________________ 3Wholesale associations________________________________________________________ 4

Membership of wholesales________________________________________________ 4Expansion of services and facilities______________________________________ 4Distributive operations___________________________________________________ 6Capital and resources__________________ ,__________________________________ 6

Service operations of central cooperative organizations______________________ 8Production by cooperative federations________________________________________ 9.

Expansion and new facilities_____________________________________________ 10Type and value of goods produced_______________________________________ 13Geographical location of cooperative plants____________________________ 15

Employment and wages in cooperative business federations------------------------ 16

(H)


Bulletin 7no. 796 o f theUnited States Bureau o f Labor Statistics

Reprinted from the Monthly Labor Review, September and October 1944, with additional data.]

Operations of Consumers Cooperatives in 1943

Summary

A general advance in both membership and volume of business by cooperative associations providing consumer goods and services was noted in 1943. In that year retail distributive business done by these associations reached an estimated total of 468 million dollars^ and service business (meals, housing, 'medical care, burial, etc.) accounted for about 12% million dollarsaltogether over 480 million dollars. The wholesale associations supplying these local organizations had a combined wholesale distributive business of over 148% million dollars, in addition to a service business exceeding 3% million dollars. Net savings on the wholesales' operations for the year exceeded 8% million dollars, of which over 6 million dollars was returned to member associations in patronage refunds. Service federations had a combined business of nearly 2 million dollars.

The central business federations manufactured goods valued at over 31 million dollars, all but 5 million of which was produced by the wholesales.

Increased production and acquisition of productive plant by the federations and diversification of activities by the local associations may be said to have been the outstanding developments in the consumers' cooperative movement in the United States in 1943.

Nearly all types of associations showed an increase in number as well as business progress in 1943 compared with 1942. Exceptions were housing associations, which are at a standstill because of wartime restrictions on construction, associations providing rooms and meals, which have declined somewhat because of the closing of many rooming and eating clubs of male students at universities, and credit unions, whose membership and business have fallen off as a result of a combination of wartime factors.

Table 1 summarizes the status of local associations and federations as of the end of 1943.

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2T able 1. Membership and Business o f Local Cooperatives and Central Federations

in 1943

LOCAL ASSOCIATIONS

Type of association

Retail distributive associations............................................Stores and buying clubs. _..............................................Petroleum associations....................................................Other distributive...................................... ...................

Distributive departments of farmers marketing associations 1____________________________________________

Service associations...............................................................Rooms and/or meals.......................................................Housing________________________________________Medical and/or hospital care:

On contract..............................................................Own facilities........ ..................................................

Burial:8Own facilities............... ................ .........................Caskets only............................................................

Cold storage-..................................................................Water.............................................................................Printing and publishing.............................................Recreation......................................... ............................Miscellaneous.................................................................

Electricity associations *.......................................................Telephone associations _.....................................................Credit unions.................................... ...................................Insurance associations...........................................................

Total number of asso

ciations (estimated)

Number of members

(estimated)

4,225 1,355,0002,700 600,0001,475 735,000

50 20,000

550 200,000594 386,300200 20,00059 2,100

75 200,00018 25,000

40 30,0003 1,300

80 26,00033 2,00016 75,00025 3,50045 1,400

850 1,210,0005,000 330,000

10,460 3,041,0002,000 10,000,000

Amount of business

(estimated)

468.000. 000236.000. 000225.000. 000

8, 000,000180.000. 000 12,270,0002.775.000

8 1,575,000

4,000,0001.750.000

300.000 5,000

950.000200.000475.000 65,000

175.000 35,000,000 *5,485,000

211,492,000 185,000,000

DISTRIBUTIVE, SERVICE, AND PRODUCTIVE FEDERATIONS

Type of federation

Wnm. Matti.Amount of business

Value of own production

Net earnings from all depart

ments

Patronage

refunds from all departments

ber of federations

berassociations Wholesaledistributive Service Retail

Wholesales:Interregional_____ 2

2311149

24 3,377

165 1,114

8 15

7 $5,182,943 140,293,798

2,808,696

7 $2,149,002 23,395,842

555,283

? $131,750 8,317,010

112,229 54,954

166,115

? $114,826 6,044,657

89,769 8,911

114,437

Regional.... ........... $3,191,796 105.888

1,865,376

$16,610,613D istrict.._______

Service federationsProductive federations. 5,004,128

< Figures not estimates but actual aggregates for the 550 associations for which data were available.* Gross income.8 Local associations only; burial organizations composed of local associations, are included under serv

ice federations.8 Data are for 1942; no data on which to base later estimate.* Data are for 1936; no data on which to base later estimate.* Data relate to reporting associations only.* One organization only.* Membership of 5 federations only.

Local Associations

Reports from various sections of the country indicate that in spite of supply, manpower, transport, and other wartime obstacles, the local associations generally had a good year. From Nebraska it was reported that Farmers Union cooperatives were in the best financial condition they have ever been with little or no indebtedness, cash operations almost universal, and increasing membership and patronage.1 In the Eastern States sales substantially increased, the greatest

i Nebraska Union Farmer (Omaha), February 9, 1944.


3proportionate rise having taken place in the associations handling the widest variety of lines. In the Illinois-Indiana-Ohio region, Central States Cooperatives reported that never before had the stores given such loyal support to the wholesale.

Among the Farm Bureau Cooperatives of Ohio, numerous new cooperative service points were established, and a record-breaking crop of new associations and new stores was reported in the New England and Middle Atlantic area. Some of these were in recent housing developments where the. concentration of families made new shopping facilities necessary.

Diversification of business continued apace. Stores added new lines, petroleum associations began to handle groceries and other goods, and many farmers marketing and purchasing associations added the handling of groceries and household supplies to the farm supplies previously carried. Numerous new stores, coal yards, lumber yards, cold-storage lockers, etc., were acquired during the year.

A wartime development that is also of interest consists of the associations in the War Relocation Centers. Although none of the 10 enterprises was in operation during the entire year (the periods of operation ranged from 2 months to 7 months), the organizations had a combined business of $10,295,165 on which net earnings of $1,257,555 were made. These associations had the encouragement of the War Relocation Authority, but were privately financed. At the end of 1943 the cooperatives had a membership of 40,720 out of a total camp population of 92,451.

OPERATIONS IN 1943

Data on 1943 operations were available for some 1,100 associations for both 1942 and 1943. The business done by these organizations rose from $157,806,076 to $196,811,869 in the period, or 24.7 percent. Membership rose almost as much, even though a fifth of the reporting associations had a decrease in members from 1942 to 1943.

T able 2.Membership, Business, and Net Earnings o f Local Cooperatives in 1943 asCompared with 1942

Membership Amount of business Net earnings

Type of association Per

Percent reporting

Per

Percent reporting

Percent which went

from

Percent report* ing

cent of increase

intotal

Increase

in1943

D ecrease

in1943

cent of increase

intotal

Increase

in1943

Decrease

in1943

Gainin

1942 to loss

in1943

Lossin

1942 to

gainin

1943

Lossin

bothyears

Increase

ingain

in1943

Decrease

ingain

in1943

AH types K................... ............. 21.9 68.4 223.3 24.7 76.8 23.2 3.4 3.4 0.9 56.9 35.6

Stores and buying clubs............. 13.6 67.4 25.7 28.8 84.7 15.3 6.8 5.3 1,9 51.7 34.3Petroleum associations________ 23.9 74.6 23.0 19.1 71.5 28.5 .4 1.8 60.3 37.5Distributive departments of

farmers marketing associations........................................ 11.1 56.3 34.2 43.5 86.8 13.2 3.0 3.0 60.6 33.3

1 Includes a few associations of various types, none sufficiently numerous to justify separate computations. * 8.3 percent reported no change.*


4Reflecting, probably, the effects of rationing and supply difficulties, 28.5 percent of the petroleum associations as compared with 15.3 percent of the stores and buying clubs reported a falling off in business during 1943 (table 2). Wartime difficulties were also reflected in earnings realized; 56.9 percent reported larger earnings in 1943 than in the previous year (in 1942, 68.5 percent were in this group). Altogether, for 35.6 percent of the associations net savings made on operations were smaller than in the previous year (for 1942 the corresponding proportion was 23.6 percent).

The 159 distributive associations which reported as to patronage refunds had returned to members on their purchases in 1943 the sum of $1,328,017.

Insurance associations.Cooperative insurance associations connected with the consumers cooperative movement, for which data are available, were almost unanimous in reporting good results in 1943, and several had the best year in their history. The largest of all, the Ohio Farm Bureau insurance companies, writing life, fire, workmens compensation,.and casualty insurance in 12 States and the District of Columbia had a premium income of $14,365,500 in 1943. A controlling interest in an old-line insurance company with headquarters in Maryland was acquired during the year.

Cooperators Life Association had $5,060,912 of insurance in force at the end of 1943, as compared with $4,090,075 in 1943.

Wholesale Associations

MEMBERSHIP OF WHOLESALES

The 23 regional wholesales for which membership was reported had a total of 3,377 affiliates at the end of 1943, a gain of 274 as compared with the preceding year. The district wholesales also made a membership gain, the number of associations federated in the 11 reporting wholesales rising from 148 in 1942 to 165 in 1943. Thirteen regional wholesales reported 2,270 unaffiliated purchasers, and 4 of the district wholesales reported 31 such associations.

Seventeen regional associations reported as to the number of families served by their affiliates; the 1,634 associations covered by these reports had individual members (families) totaling 1,007,271. The 129 affiliated associations of the 6 reporting district wholesales had a total of 75,727 individual members.

EXPANSION OF SERVICES AND FACILITIES

Except for a large expansion in productive plant (see p. 10), comparatively few new services or facilities were added in 1943.

Ohio Cooperative Grocery Wholesale was formed in November 1942 as a subsidiary of Central States Cooperatives and Ohio Farm Bureau Cooperative Association, to serve Ohio cooperatives. Because of difficulties entailed by war conditions the actual functioning of this organization has been postponed.

Among the regional wholesales, Central States Cooperatives and Eastern Cooperative Wholesale both added a department to handle fresh fruits and vegetables, Midland Cooperative Wholesale and Farmers Union Central Exchange both added clothing to the lines of


5T able 3. Membership o f Cooperative Wholesale Associations, 1942 and 1943

AssociationYear in

which or

Number of affiliated associations

ganized1943 1942

Interregional

Illinois: National Cooperatives.................. ............................................ 1933 16 16Ohio: United Cooperatives.......................... ........................................... 1930 8 8

RegionalIllinois:

Central States Cooperatives.............................................................. 1936 115 102Illinois Farm Supply C o . . .---- --------------------------------- 1927 140 137

Indiana: Indiana Farm Bureau Cooperative Association.......:............... 1921 86 93Iowa:

Iowa Farm Service Co............................................................ ........ 1927 29 30Farmers Elevator Service Co.................. ......................................... 1926 1367 380Cooperative Service Co___ i ____________ ______ -...................... 1935 33 26

Massachusetts: United Cooperative Farmers....... ___________ ____ 1927 11 11Michigan: Farm Bureau Services.......... ....... ............................. ........... 1920 140 139Minnesota:

Midland Cooperative Wholesale__________ ___________ _______ 1926 298 252Farmers Union Central Exchange___________________ _____ ___ 1927 310 300Minnesota Farm Bureau Service Co__________________ ________ 1928 49 45

Missouri: Consumers Cooperative Association_____________________ 1928 749 592Nebraska: Farmers Union State Exchange............... ............. ....... ....... 1914 323 319New York: Eastern Cooperative Wholesale...................... .......... .......... 1929 162 155Ohio: Farm Bureau Cooperative Association......................................... 1933 87 87Oregon: Oregon Grange Wholesale_______________________________ 1937 15 15Pennsylvania: Pennsylvania Farm Bureau Cooperative Association___ 1934 22 22Texas: Consumers Cooperatives Associated........ ................................... 1931 106 82Utah: Utah Cooperative Association.......... ....................... ............. ...... 1935 10 6Virginia: Southern States Cooperative....................................... ............Washington: Pacific Supply Cooperative... ............................................

2 1923 80 801933 94 87

Wisconsin:Wisconsin Cooperative Farm Supply Co.......................................... 1923 114 13Central Cooperative Wholesale......................................................... 1917 137 130

District

California: Associated Cooperatives of Northern California3.................... 1939 28 17Michigan:

11Cooperative Services.......................................................... .............. 1932 11Northland Cooperative Federation................................................. 1938 8 7

Minnesota:Trico Cooperative Oil Association____________________________ 1929 18 16C-A-P Cooperative Oil Association........................................... ....... 1929 10 10Range Cooperative Federation.............. ......... .................................. 1924 29 26

Wisconsin:Fox River Valley Cooperative Wholesale______ ______ _________ 1936 40 42A & B Cooperative Association______________________________ 1930 5 4Iron Cooperative Oil Association___ ___________ ______________ 1930 7 7Cooperative Services__________________________ _____________ 1928 6 5Price County Cooperative Oil Association--- ---- ----------- ---- 1934 3 3

i Data are for 1941.8 Estimated.3 Phrase of Northern California dropped in 1944, when association enlarged coverage to whole State.

merchandise handled, milking machines were added by the Utah Cooperative Association and Consumers Cooperatives Associated (Texas), and the latter also feed, salt, and steel products. A new branch warehouse was opened by Michigan Farm Bureau Services.

The fresh produce department of Cooperative Terminal Association (marketing organization at Duluth, Minn.) was taken over by Central Cooperative Wholesale. The Terminal warehousing and marketing activities were suspended as of April 15, 1944.

Among the district organizations, Range Cooperative Federation opened a new gasoline service station. Northland Cooperative Federation, on the other hand, closed its service station which had been operating at a loss, but purchased a creamery. The handling of automobile tires was discontinued by the Fox River Valley Cooperative Wholesale.


6At the end of 1943, the 18 reporting regional wholesales had a total of 51 warehouses. Two others were operating on a brokerage basis, doing no warehousing. Eight reporting district associations had a total of 14 warehouses.

Only 6 of the regional associations and 2 of the district associations had retail branchesa total of 30 and 3 branches, respectively.

DISTRIBUTIVE OPERATIONS

The 24 regional associations for which data are at hand had a combined business in 1943 of $156,904,411 ($140,293,798 wholesale, $16,610,613 retail). Net earnings of nearly 7% million dollars were realized on the years business, of which 77.6 percent was returned to member associations in patronage refunds. Not all of the earnings shown in table 4 were realized on the distributive business alone; in fact a considerable part was earned by service and productive departments but was not segregated by department.

For identical associations reporting for both 1942 and 1943, there was a 22.9-percent increase in business, a 39.4-percent increase in earnings, and a 36.4-percent increase in patronage refunds.

I t was reported 2 that goods purchased by regional affiliates of National Cooperatives through that organization totaled $4,096,872, or nearly double the amount in 1942. Appliances and automotive accessories accounted for the largest volume of purchases, followed in order by groceries and building materials.

CAPITAL AND RESOURCES

Total assets amounting to $37,487,766 were reported by 23 regional organizations; the 8 reporting district associations had a total of $681,293. Current assets of 19 regional associations amounted to $17,093,926 as against current liabilities of $7,051,260. For 8 district associations the figures were $417,912 and $107,963, respectively. For individual regional associations the ratio of current assets to current liabilities ranged from 1.2:1 to 19.6:1 and averaged 2.4:1. For the district associations the range was from 1.2:1 to 9.5:1 and the average 3.9:1.

For the whole group of regional wholesales that reported on both total and current assets, 64.1 percent of the total assets were current. Among the individual associations the proportion ranged from 39.7 to 93.5 percent. For the district wholesales the average was 61.3 percent and the range was from 28.5 percent (for a new association only recently started) to 94.3 percent.

Share capital (including membership fees and certificates of 2 nonstock associations) of 20 regional associations at the end of 1943 totaled $4,236,902 and of 8 district associations (1 of which was a nonstock organization) $364,328. Share capital has, for many of the wholesales, formed only a small part of the associations funds; these have commonly been built up largely from earnings.

A development of the last few years has been the increasing cooperative use of preferred stock carrying no voting power. Among the 20 reporting regional associations, 9 made no use of this financial *

* Midland Cooperator (Minneapolis), March 8,1944.


7T able 4. Distributive Business, Net Earnings, and Patronage Refunds o f Cooperative

Wholesales, 1942 and 1943

Association

All associations: Interregional.Regional......District____

Interregional

Ohio: United Cooperatives............ ..

RegionalIllinois:

Central States Cooperatives.......111. Farm Supply Co..................

Indiana: Farm Bur. Coop. Assn____Iowa:

Iowa Farm Service Co................Farmers Elevator Service Co___Cooperative Service Co...............

Massachusetts: United Coop. Farmers.............................. ....................

Michigan: Farm Bureau Services___

Minnesota:Midland Coop. Wholesale..........Farmers Union Cent. Exchange.Minn. Farm Bur. Service Co___

Missouri: Consumers Coop. A ssn.... Nebraska: Farmers Union State

Exchange........... ...........................New York: Eastern Coop. Wholesale.Ohio: Farm Bureau Coop Assn........Oregon: Oregon Grange Wholesale... Pennsylvania: Farm Bureau Coop.

Assn................. .............................Texas: Consumers Cooperatives

Associated......................................Utah: Utah Cooperative Assn..........Virginia: Southern States Coopera

tive.................................................Washington:

Pacific Supply Cooperative........Grange Coop. Wholesale........ .

Wisconsin:Wisconsin Coop. Farm Supply

Co... ........................................Central Coop. Wholesale............

District

California: Associated Cooperativesof Northern California.................. .

Michigan:Cooperative Services_____ _____Northland Coop. Federation...

Minnesota:Trico Coop. Oil A ssn.................C-A-P Coop. Oil Assn................Range Coop. Federation.............

Wisconsin:Fox River Valley Coop. Whole

sale............. ....... ..................A. & B. Coop. Assn.................. .Iron Coop. Oil Assn__________Cooperative Services.............. .Price County Coop. Oil Assn___

Amount of business 1 2 Net earnings Patronage refunds 3 4

1943 1942 1943 19421

1943 1942

$5,182,943

1

$9,905,611 $131,750 $100,000i

$114,8261 $94,2268 156,904,411 3123,181,462 7,740,892 5,520,256

132,5236,044,65714,357,698

2,808,696 2,846,905 112,645 89,769 116,607

5,182,943 9,905,611 4 131,750 5 100,000 4 114,826 94,226

494,307 264,025 11,000 6,U9 10,000 6,64514,118,070 15,083,781 8 1,054,948 4 1,055,499 8 896,830 4 902,81310,571,397 9,255,394 7 1,323,887 8 793,428 8925,424 8 496,897

1,232,292 0 47,449 45,549 45,645 39,690io 1,516,000 0 9 82,081 0 78,350 0

95,483 11 83,763 16,753 30,814 15,077 20,815f 12 1,412,316 l 13 1,789,218 } 2,631,424

/ 12 40,620 \ 13 51,698 } 69,058

/1240,620 \1351,698 } 0*)

/ 12 4,757,493 \ 13 1,675,238

4,343,8151,244,298

144,161 54,411 } 8247,052 6193,638 8232,773

9,004,955 10,641,839 1,309,288

10.409,115 / 12 2,409,699 \ 13 1,165,593

3,210,180 17,363,046

6,949,509 8,949,756 1,181,000 9,885,198

12 2,407,020 13 879,970 2,765,155

12,850,586

8 362,996 782,562 104,690 201,908

12105,189 13 43,525 -22,247 8 494,494

8 149,503 347,663

72,700 190,101

12110,757 13 2,276 63,634

8 359,607

8 273,353 528,603 104,432

4 680,77412 64,81113 28,754

8 122,646 200,950 72,600

4 545,356 12 50, 117 13 2,262 56,544

8 168,7358 342,733291,837 is 276,587 31,395 i* 4,562 20,612 15 3,290

7,584,152 5,192,905 352,633 227,715 187,064 144,253

2,134,206 1,420,601 63,829 59,300 63,829 24,8560254,109 216,568 8,079 0 8,259

J12 28,524,939 \13 11,980,564

12 19,700,580 13 8,784,476

12 1,596,695 13 232,514

121,105,730 13 141,568 } 967,495 878,041

3,837,664 3,268,562 8 353,097 275,652 353.097 8 255,9182,761,574 0 0 0 0

1,001,212 ii 543,649 835,622 ii 14,168 8 26,367 8 137,192

ii 9,2785,358,625 5,002,840 8 166,903 147,801 8 123,219

238,502

121,674

217,849

155,925

343 80

0 6,2584,073

0 5,9220

23,517

162,790

220,321

105,842

260,436

1,136

16,397 23,517 16,397110,074 119,847 9,655 9,694 9,655 8,873926,795 970,119 29,196 24,600 23,711 22,236

534,662 549,019 26,872 40,843 20,575 39,684117,376 8 120,202 9,186 37,504 9,186 8 7,271189,328 150,000 8,163 0 2,292 0

i 149,427 197,6660

11,281 15,954 7,953 9,104037,747 416 0 0

1 Except where otherwise indicated, figures relate to wholesale distributive business.2 Includes all refunds declared, regardless of form (cash, shares, members equity credits, etc.) in which

paid. 8 Wholesale and retail.4 Includes productive departments. 6 Estimated. Includes service departments.7 Includes $504,765 from distributive business, $245,263 from services, and $869,167 from production, minus

$295,309 (expenses of administration not allocated by department).8 Includes productive and service departments. 9 No data.i Includes an estimated $750,000 handled on brokerage basis. 11 Data relate to 1941.1* Wholesale. 18 Retail. 14 2.9 percent; amount not reported. 15 Data relate to 1940.

615829 44------2


8device while the other 11 had issued preferred stock aggregating $5,093,629. For the associations with preferred stock, such stock constituted on the average 23.1 percent of their total liabilities, Among the individual associations the range was from 12.4 to 40.5 percent. In 3 of the associations, preferred stock accounted for less than 20 percent of the total liabilities; in 6 associations, from 20 to 30 percent; and in 2 associations, over 30 percent. There seems to be some difference of opinion among cooperators as to the desirability of this type of financing, especially if the stock is not confined to cooperative members but is offered to the general public. Some associations are of the opinion that bonds or debentures are preferable. Recently, several of the associations7 meetings have voted to pay at least part of the patronage refunds to the local associations in preferred stock.

Service Operations o f Central Cooperative Organizations

A number of the wholesales offer services of various kinds, in addition to their distributive business. There are also several enterprises (the member-owners of which are local or wholesale associations) which were started to provide services desired by the members. For the associations that furnished data the 1943 business done in services totaled $5,163,060$3,297,684 for the wholesales and $1,865,376 for the service federations, divided as follows:

Auditing_________________________Insurance, bonds, etc___________Financing and credit____________Burial____________________________Transport (by water and truck)Automobile repair_______________Tire recapping__________________Management____________________Mimeographing_________________Recreation_______________________Other (not specified)------------------

Wholesaleservice Service

departments federations

$40, 287 $114, 07047, 359 2 ,55332, 742 146, 14232, 750 45, 231

2, 407, 761 1, 557, 04786, 59617, 47715, 496

3334 ,864

612, 352

As table 5 indicates, some of the associations concentrate on a single service; others carry on a variety of activities. An example of the latter type was the young Federated Cooperatives of East Central Minnesota, which operated 3 funeral establishments, besides offering insurance and mimeographing services4activities which, as it explains, any one individual cooperative would be too small to do for itself7 7 and which the regional wholesales have not wanted to undertake. The membership of this federation includes stores, petroleum associations, creameries, shipping associations, and electricity cooperatives in 6 counties.

I t should be noted that table 5 does not reflect the full earning capacity of the service departments of the wholesales. In most cases their earnings (and patronage refunds) were not separable from those of the distributive business and are included therefore in the data shown in table 4.

4 Insulating and trucking added in 1944.


9T able 5. Service Activities o f Central Cooperative Organizations, 1943

Association

Member

associa

tions

ServiceAmount

ofbusiness

Netearnings

Patronage refunds

Total.......................................... .............. $5,163,060 $476,228 $355,100Service departments of wholesales.......... 3,297,684 421,274 346,189Service federations. ........................ ....... 1,114 1,865,376 54,954 8,911

Service departments of wholesales

Illinois: Illinois Farm Supply Co........ ...... Transport (truck, tow 1,694,077boat). 409,880 346,189

Tire recapping.......... ____ 17,477Indiana: Farm Bureau Cooperative Asso- Auditing..................... . 17,186

ciation. Trucking. ........................ 235,696Auto repair....................... 32,399 /i\Insurance.......... ............. 32,331 0 (VFinance (or credit)........... 32,742Other................ ............... 612,352

Michigan:Farm Bureau Services......................... Management...... ............. 15,496 11,048 0Northland Coop. Federation________ Recreation (park)______ (2) 8 269

Minnesota:Midland Coop. Wholesale................... Trucking. ............. .......... 111, 513 0 0Range Coop. Federation__________ ... __do.. .................... 17,604

Auto repair....... ............... 35,690Insurance.......................... 14,980 0 0Mortuary...:................... 32,750Recreation........................ 4,864

New York: Eastern Coop. Wholesale____ Fidelity bonds_________ 48 0 (2)Ohio: Farm Bur. Coop. Assn_____ _____ Trucking_________ _____ 114,462 (1) (1)Utah: Utah Coop. Assn............. ....... ....... .......d o .. ............................ 27,012 615 0Washington: Pacific Supply Cooperative. _ ___do....... ....... .................. 123,578

} 0Auto repair....................... 18,507Wisconsin:

Wis. Coop. Farm Supply Co__........... Trucking.......... ............... 6,649i (I)

0Central Cooperative Wholesale______ Auditing...___ ________ 23,101

Trucking.......................... 77,170 ) (1) 0Service Federations

Minnesota:Federated Co-ops of E. Cent. Minn.4__ 23 Insurance................. ....... 2,553 232

Mortuary____ _________ 10,066 8 2,065Mimeographing........ ....... 333 8 94

Northland Coop. Burial Assn............. 21 Mortuary______________ 18,965 ,3,617Coop. Auditing Service_____________Midland Credit Corp______________

467104

Auditing_______________Credit finance__________

55,416 2,654

3,1631,165

2,848619

Farmers Union Accounting Services.. 124 Bookkeeping, auditing___ 15,217 363 363Farmers Union Coop. Credit Assn.5. _ _ 123 Loans to cooperatives___ 8 112,966 3,096 2,396:Farmers Coop. Trucking Assn___ _ 78 Trucking.___ ________ 1,444,089 36,620 0

Montana: Farmers Union Transporters__ 42 Trucking of fuel oils....... . 84,398 82,800Nebraska:

Farmers Union Coop. Transport Assn. 2 ___ do....... ....................... 7,703 1,001 901D o .. .. ..................................... . 4 ___ d o ............................. 20,857 2,467 0

South Dakota: Equity Audit Co________ 35 Auditing______________ 24,543 2,702 ' 960Washington: Northwest Coop. Auditing 84 ___ do_________________ 18,894 824 824

and Service Assn.Wisconsin:

Valley Coop. Services4_____________ 5 Funeral and ambulance 16,200 4,087service.

Central Finance, Inc............................ 2 Financing of sales contracts for cooperatives.. 8 30,522 576

1 Figures not separable from distributive business; see table 4.2 No data.8 Loss.4 Data cover 8 months operations.8 Data cover 14 months operations.8 Amount of loans made.

Production by Cooperative Federations

By the middle of 1944 more than 100 productive plants were being operated by central federations connected with the consumers' cooperative movement in the United States. Eighty-five of these plants, for which data were available, in 1943 produced goods valued at more than 31 million dollars, or more than twice the amount in


10

1941. Farm supplies accounted for over half the value in 1943 and petroleum products for about a third. Purely consumer goods formed 6.3 percent of the total.

The geographical distribution of the various productive enterprises operated by central cooperative organizations is shown on the accompanying map.

According to the Cooperative League of the U. S. A., cooperatives go into production for four reasons: (1) To assure a source of supply for the goods they distribute; (2) to break the hold of monopolies, trusts, or cartels; (3) to lower the price of commodities where the price has been held at artificially high levels; and (4) to control the quality of goods handled.5 I t appears that each of these factors has been an influence in various cases in the United States. The most powerful motivation in recent years has been the desire of the movement to become self-sufficient to as great an extent as possible and to obtain for the members the large financial benefits that accrue in manufacture.

A great many retail associations with farmer membership have feed mills, a few urban cooperatives have bakeries, and one or two local associations manufacture sausage. With these exceptions, however, most of the cooperative production in the United States is carried on by the cooperative wholesale associations, either individually or jointly, or by other central organizations of the federated type.

EX PANSIO N AND N EW FACILITIES

Expansion in 1948 More productive facilities were acquired in 1943 than in any previous year.6

The greatest expansion took place in the production of petroleum and its products. Altogether, five petroleum refineries were purchased by regional cooperative wholesale associations, either singly or in conjunction with other wholesales. According to figures given in the cooperative press, these refineries represented a total investment of $10,971,500. Three of these plants, for which capacity was given, are capable of turning out a total of 281,000,000 gallons of refined fuel yearly, and one also has a lubricating-oil department with a capacity of 10,000 gallons. The maximum output for the other two plants was not reported, but one was stated to be capable of handling 4,500 barrels of crude oil per day; the fifth plant was considerably smaller. A furfural plant for improving the quality of petroleum products was under construction at the end of 1943, at a cost of about $165,000.

These acquisitions also included 474 miles of pipeline. The largest purchase also involved an oil-compounding .plant, 270 oil wells, and 104,408 acres of oil-bearing lands in Illinois, Kansas, New Mexico, Oklahoma, and Texas. In addition, the wholesale which pioneered in petroleum production several years ago, and had 12 oil wells in operation at the end of 1942, brought in 4 more wells in 1943.

Five sawmills were purchased. For two of these the capacity was not given; that of the other three combined amounted to 41,000,000 board feet per year.

* Consumers Cooperation (New York), December 1943, p. 138.6 For purchases by individual associations, see Monthly Labor Review for March 1944 (pp. 561-666).


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Two feed mills, one with a maximum output of 100,000 tons per year and the other of 10 carloads per day, were bought. A third mill of 100,000 tons annual capacity was leased from a private owner. One of the above purchases also included a lumber yard and coal yard.

The petroleum wholesale above mentioned installed in the cannery bought in 1942 a dehydration unit capable of handling 35 tons of potatoes per day, and bought a new cannery with a maximum output of 30,000 to 50,000 cases per year. This plant has canned only tomatoes thus far but plans to handle other local crops also. In connection with the cannery the association installed greenhouses and hotbeds for both seed and yield.


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National Cooperatives, Ine., the purchasing agency for the regional wholesales, took its first step into production with the purchase of (1) a chemical factory producing cosmetics, floor wax, and related household supplies, and (2) a milking-machine plant costing about $200,000.

Other acquisitions by regional or national organizations included a printing plant, a coffee-roasting unit, 2 glucose plants, a potato-starch factory, 3 grain elevators and mills (2 of these had a combined capacity of 410,000 bushels), an alfalfa dehydrator, a chick hatchery, a seed-cleaning mill, and 2 farm-machinery plants.

A district wholesale purchased a creamery and undertook the retail distribution of milk, as well as the manufacture of butter and cheese.

Expansion during first half of 1944Since the beginning of 1944, several additional plants or productive facilities have been purchased or authorized. The Indiana Farm Bureau Cooperative Association bought a one-fourth interest in a Kentucky coal mine, with the understanding that that wholesale will act as sole distributor of the output, to the 120 cooperative coal yards throughout Indiana. The system of direct supply from mine to cooperatives is expected to result in considerable savings, besides which the cooperatives will also share in the earnings from the mining operations.

Cooperative Services at Waterloo, Iowa, bought from a private company an oil-compounding plantthe first productive venture of this wholesale. The 1944 annual meeting of Consumers Cooperatives Associated (Texas) authorized the purchase of a petroleum refinery.

National Cooperatives added to its productive facilities by the purchase of a shingle mill at Sand Bay on Vancouver Island (B. C.). The purchase also included shore land and cottages.

Three soybean-processing plants were acquired in 1944by the Farmers Union Central Exchange, and the Ohio and Pennsylvania Farm Bureau Cooperative Associations, respectively; a similar plant was planned by Consumers Cooperative Association (Missouri) which it was expected would be in operation by the time the crop was ready. The products of these plants are high-protein cattle feed and edible oil. The Ohio wholesale also bought another fertilizer plant.

Including wells previously drilled and those acquired in 1943, by the end of 1943 Consumers Cooperative Association had 286 oil wells in production and leases on 104,408 acres of oil-bearing land. Since the beginning of 1944 the association has been drilling 5 wells; one of these came in early in February, but another proved to be a duster and was abandoned. The organization is operating for the Federal Government an aviation-gasoline refinery. Early in 1944 the association established a geological and exploration division, with 5 full-time geologists.

Another development during the first half of 1944 was the formation of the Atlantic Seed Stocks Cooperative, the members of which are the Pennsylvania Farm Bureau Cooperative Association, Southern States Cooperative, Eastern States Farmers Exchange, and the Cooperative G. L. F. Exchange. The new association will produce foundation seed corn adapted to production in the Eastern States. This is, of course, purely a producer (not consumer) activity and is noted here only because of the fact that cooperative wholesales handling consumer goods are among its members.


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A meeting of the grocery committee of National Cooperatives, in July 1944, voted to ask the parent organization to study the possibilities of acquiring flour mills sufficient to supply the entire needs of the consumers cooperatives. ,

Thus far it has been impossible to operate at capacity some of the cooperative oil refineries in the Middle West, owned by C. C. A. and other wholesales, because of the shortage of crude oil in this area as a result of diversion to the refineries making aviation gasoline. To some extent the situation has been met by utilizing crude oil from the Texas field.

TYPE AND VALUE OF GOODS PRODUCED

As table 6 indicates, the reporting associations manufactured goods valued at over 31 million dollars in 1943. Purely consumer goods (bakery goods, butter, cheese, meat products, flour, etc.) formed only 6.3 percent of the total value. Of commodities used for both consumer and producer purposes, petroleum products (and operations connected with their production) accounted for 32.4 percent and paint and lumber for 5.5 percent. Farm supplies constituted 54.9 percent.

T a b l e 6 . Value o f Goods Produced Cooperatively in 1943, by Product

Product Value of goods produced Net earningsAmount of patronage

refunds

All p ro d u c ts______ ____________________ _______ $31,104,255 $1,085,274 $748,286

F ood............................................................................ 1,958,036 189,622 495,847

59,436

12,406 7,015Bakery products._________________ ___________Butter and cheese...... .................. ........... ...............

812,406

0)

(!)Meat products______ _________________________ 0)Flour, cereals, etc_____________________________ 416,154

709,709 87,268 31,340

1,672,756 6,743,901 1,358,479

223,864

' 7,015 0)Canned goods________________________________

Coffee roasted................................... ........... ......Crude oil____________ ___________ _______________ 10,524

58,102(2)

Pipe-line operations______________________________ (2)Refined oils_____________________________________ 595,939

(3)415,344

(*)Lubricating oil___________________________________Grease__________________________________________ (i) 0)N atural gas_____________________________________ 8,272

1,351,782 326,959

5,316 9,579,646 7,201,511

246,247 35,644

360,502

0) 0)Paint ........................................................................... < 91,756

7,953(9

176,399

)

1 Data not available separately; included with wholesales distributive operations (table 4).2 Included with refined oils.3 Not available separately; some included with paint.< Includes some earnings and refunds on manufacture of paint and barn equipment.< Some earnings and refunds not available separately for printing; included with wholesales distributive

operations.

The table covers 85 plants. I t does not include figures for some of the more recent acquisitions, which were not under cooperative ownership or on a cooperative basis during the full year. Among such enterprises not included were the plants of the National Cooperative Refinery Association, the milking-machine plant of National Cooperatives, the feed mill of Consumers Cooperatives Associated at Edroy, Tex., and the cultivator plant of National Farm Machinery Cooperative, at Bellevue, Ohio. In fact, none of the operations of the


14

National Farm Machinery Cooperative are included, as that association was occupied in building tanks for the Federal Government.

As regards the productive departments of the wholesales, in many cases the earnings from production are not separable from those of the distributive business. The productive earnings of the few organizations for which this information was available exceeded $1,000,000 in 1943 and member associations benefited by returns amounting to slightly over $748,000 on their patronage.

That the productive enterprises are very profitable is indicated by the fact that their earnings pay back the initial cost fairly soon. Thus, the cosmetics plant of National Cooperatives paid for itself in 6 months and the milking-machine plant in 10 months. The refinery of Indiana Farm Bureau Cooperative Association was paid for out of 1 year's gains, as was also the jointly owned flour and feed mill in North Carolina. A similar mill in Ohio, owned by three regional wholesales, paid for itself in 16 months.

The value of the various commodities produced by individual organizations in 1943 is shown in table 7.

T able 7. Production by Central Cooperative Organizations, 1943

Association Goods producedValue of

goods produced

Netearnings

All associations___ ____-............ ...............

Productive departments of wholesales

$31,104,266 $1, 085,274

Pa-tronage

refunds

$784,286

Illinois: Illinois Farm Supply Co_______________Indiana: Farm Bureau Cooperative Association . . .

Michigan: Northland Cooperative Federation. Minnesota:

Midland Cooperative Wholesale..............

Farmers Union Central Exchange..............

Minnesota Farm Bureau Service Co..........

Range Cooperative Federation...................

Missouri: Consumers Cooperative Association.

New York: Eastern Cooperative Wholesale. Ohio:

Farm Bureau Cooperative Association..

United Cooperatives.

Pennsylvania:Pennsylvania Farm Bureau Cooperative Association

Washington: Pacific Supply Cooperative...............Wisconsin:

Wisconsin Cooperative Farm Supply Co..........

Feed, seed, hay..........Refined oils_________Printing......................Fertilizer....................Chicks................ .......Butter and cheese.......

Refined oils................Pipe line and tank cars.Natural gas................Feed............. ..............Refined oils; lubri

cating oil.Feed and seed_______Fertilizer...................Meat products............Butter and cheese.......Crude oil....................Pipe line ................Refined oils........ .......Lubricating oil...........Paint....... ...............Grease....... ................Lumber...... ...............Canned goods.............Printing....... .............Shelving units............

Refined oils_________Chicks....................Fertilizer....................Lubricating oil...........Paint______________Barn equipment....... .

Seed....................... .Feed...........................

Flour, antifreeze, etc

Central Cooperative Wholesale.

reeu, aeeu__ ....Fertilizer........... .Bakery products. Coflee roasting-..Feed.................. .Seed.................. .

3,412,407 2,058, 755

23,068 2,072,341

211, 257 84.335

162,838 138,536

0) 00 0)

1,895,944 104,880

8,272 33,545 0

00

0

0139,432 \ 56,821 / 59,436 \

411,512 / 31,340

1,567,876 2,369,362

492,227 104,676 223,864 360,502 709,709 56,536 5,316

0 00 010,524 58,102

595,939

19,057 a 44,952 *415,344

0) 00 0)

419,840 34,990

1,959,346 866, 252

1, 247,106 35,644

0) 0)

91,756 79,969

159,317 \ 1,827,372 /

15,8840)0

00)

76,005 1 530,415 \ 128,160 ) 189,622 ) 87,268 I

1,969,825 f 59,668 J

00

00

See footnotes at end of table.


15T able 7. Production by Central Cooperative Organizations, 1943Continued

Association Goods producedValue of

goods produced

Netearnings

Patronage

refunds

$187,96086,90336,929

| $3,309 $1,647

1,312,650 142,164

1,821,742 1,163,101

22,839

13,56172

13,561

97,91234,283

872

64,80024,649

872

32,228115,26042,07640,276

} 9,097

3,540 3,469

5,368

3.540

Productive federation8Indiana:

Cooperative M ills5...............

Farm Bureau Milling Co. *..........................Farm Bureau Printing Corporation......... .

Maryland:Cooperative Fertilizer Service7....................Fertilizer Manufacturing Cooperative8____

Minnesota: Cooperative Printing Association... Washington:

Grange Milling Co......................................

Grange Cooperative Printing Association___Wisconsin: Cooperative Publishing Association.

Flour..........................Mill feeds................Cereals and special

flour.Feed..........................Printing.....................

Fertilizer..___ do......Printing..

Feed.......Flour___Printings ----do___

1 Not available seDarately; included in wholesale's distributive operations (table 4).* Value not available; 1,760,100 gallons of refined oils, 66,729,344 gallons of lubricating oil.* Includes refunds from crude-oil production.* Includes refunds from pipe-line operations.* Owned by 4 member wholesales. Owned by a wholesale and an insurance association.7 Owned by 2 member wholesales.8 Owned by 3 member wholesales.

GEOGRAPHICAL LOCATION OF COOPERATIVE PLANTS

In table 8 are listed, by States, the productive plants of the central cooperative organizations as of June 1944.

T able 8. Location o f Productive Facilities o f Consumers9 Cooperatives

Location of plant Type of plant Location of plant Type of plant

United States United StatesCon.

Arkansas:Leola........................Pine Bluff..............

California: Hatfield Station.

Illinois: Chicago.............

Indiana:Auburn.....................Hammond................Indianapolis..............

Mt. Vernon.

Schererville. Shelby ville..Spencer___Thorntown.

Iowa: Waterloo. Kansas:

Chanute__Coffeyville..

McPherson.

Phillipsburg____

Louis ana: Meraux.... Maryland: Baltimore.

Michigan: Rock........

Sawmill.Do.

Seed-cleaning.

Chemicals (cosmetics, etc.).

Flour and feed.Do.

Seed-cleaning. Fertilizer. Oil-compounding. Petroleum refinery. Pipe lines.Fertilizer.Farm-machinery.Printing.Serum.Oil-compounding.

Petroleum refinery. Do.

Soybean-processing. Oil-compounding. Petroleum refinery. Pipe line.Petroleum refinery. Pipe line.Petroleum refinery. Feed.Fertilizer.Creamery.

Minnesota:Minneapolis...............

South St. Paul...........

Virginia......................Missouri:

North Kansas C ity ...

Milan...........Montana: Laurel. Nebraska:

Omaha...... .

Scottsbluff...

New Jersey:Bridgeton...................Mt. Holly..................

New York:A lbany.....................Batavia......................Buffalo.......................Hemlock....................New York..................Syracuse............. .......Waterloo....................

North Carolina: Statesville.

Oil-compounding.Printing.Oil-compoundingPaint.Feed mill.

Paint.Grease.Printing.Oil-compounding.Fly-spray.Cannery.Petroleum refinery.

Feed-mixing. Seed-cleaning. Petroleum refinery. Cannery. Dehydration. Soft-drink bottling.

Fertilizer.Feed.

Do.Fertilizer.Feed.Fertilizer.Coffee-roasting.Seed-cleaning.Cannery.Flour and feed.


16T able 8. Location o f Productive Facilities o f Consumers9 CooperativesContinued

Location of plant Type of plant Location of plant Type of plant

United StatesCon.

Ohio:

United StatesCon.

South Dakota: Hill City.. Sawmill.Alliance................... Fertilizer. Texas:

Barn-equipment. Amarillo..................... Oil-compounding.Paint. Edroy........................ Feed.

Bellevue....................- Cultivator. Virginia:Columbus _ Chick hatchery.

Fertilizer.Richmond.................. Seed-cleaning.

Feed.Dayton . . . . . . Roanoke___________Olflndftlfl. _ _ Do. Norfolk....................... Do.

Maumee.....................Feed.Fertilizer. Washington:

Fertilizer.

Payna Alfalfa-dehydrator.Feed.

DavATiport Feed.Roading Issaquah___________ Fertilizer.SpringfiAld Soybean-processing.

Petroleum refinery. Pipe line.

Seattle_____________ Printing.

Feed.Oklahoma:

Cushing _ . . .Wisconsin:

Burkhardt...... ..........Menomonie................ Soybean-processing.

E n id .......................... Feed. Milwaukee Oil-compounding.Feed.Coffee-roasting.Bakery.

Oregon:Ontario____________ Seed-cleaning.

Fertilizer.Superior.....................

Portland.....................Swisshome.................. Sawmill.

W aukesha.................Printing.

Pennsylvania: Milking-machinery,Avondale....................Bloomsburg................

Soybean-processing.Cannery. Canada

Manheim................... Seed-cleaning.Feed. British Columbia: Sand Shingle mill.

Warren...................... Oil-compounding. Bay (Vancouver Island).

Employment and Wages in Cooperative Business Federations

For the third successive year, average annual per capita earnings of employees of cooperative wholesales showed an increase. Earnings rose from $1,355 in 1941 to $1,523 in 1942, and to $1,976 in 1943.

T able 9.Employment, Pay Roll, and Average Annual Earnings o f Employees ofCooperative Wholesales, 1943

Type of association

Number of

associations reporting

Total number of em

Total wages paid, 1943

Average annual earnings per employee i in

ployees1943 1942

Wholesales_________________________________ 31 2,977 $4,304,641 $1,976 $1,523 1,201 1,530 1,746

(1 2)

Interregional associations_________________ 1 101 144,852 1,434Regional associations_______ ______________ 22 2,789 4,029,132

130,657 121,264(2)

2,024District associations______________________ 8 87 1,502

Service federations___________________________ 10 66 1,893Productive federations___ _________________ 9 351

1 Based only on associations which reported both on employment and wages paid.2 No data.


Bureau of Labor Statistics Reports on Cooperatives

Bulletins1No. 797. No. 770.

No. 750.

No. 740. No. 665.

No. 659. No. 608.

No. 606.

Activities of credit unions in 1943. Price 5 cents.Cooperative associations in Europe and their possibilities for post-war

reconstruction. Price 35 cents.Directory of consumers cooperatives in the United States, as of Jan

uary 1, 1943. Price 15 cents.Student cooperatives in the United States, 1941. Price 10 cents.Organization and management of consumers cooperatives and buying

clubs. Price 15 cents.Consumers cooperation in the United States, 1936. Price 25 cents.Organization and management of cooperative housing associations.

Price 10 cents.Organization and management of cooperative oil associations. Price

5 cents.Reprint pamphlets 2

Serial No. R. 1483. Serial No. R. 1660.

Serial No. R. 1453. Serial No. R. 1216. Serial No. R. 671.

The cooperative movement and the war.International aspects of the cooperative movement. (Re

print of a section of Part 1 of Bulletin No. 770.) Taxation of consumers cooperatives, 1940.Operations of cooperative burial associations, 1939. Cooperative telephone associations. (Reprint from Bulle

tin No. 659.)

1 For sale by Superintendent of Documents at prices indicated. How to order publications: Address order to Superintendent of Documents, Government Printing Office, Washington 25, D. C., with remittance in check or money order; currency is sent at senders risk; postage stamps not acceptable.

2 Copies free on application to Bureau of Labor Statistics, Washington 25, D. C., as long as supply lasts.

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IT. S . GOVERNMENT PRINTING OFFICE: 1944


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