DANISH MARKETING

Northern Advocate, 21 October 1935, Page 2

DANISH MARKETING

HOW SCHEMES OPERATE “OPEN ORDER” PLAN ADAPTATION TO N.Z. INDUSTRY, AN IMPORTANT DISTINCTION. “Although the group export system which is to be adopted in New Zealand is based on the Danish plan, sai d Mi H. E. Davis, London manager of the New Zealand Dairy Control Board, speaking at Whangarei today, there is one fundamental difference. The Danish scheme is voluntary; ours must, of necessity, embody compulsion. The Dane is born and educated a co-operator, and compulsion is not required in his case. Long before a dairy industry was ever thought of in this country, the farmers of Denmark had organised orr a voluntary basis, and were shipping large quantities of butter to Englan . They had a flying start in supplying what the buyer wanted and how he wanted it for 52 weeks in the year. “From 65 to 70 per cent of Denmark’s sales to Great Britain is placed with British wholesale and retail distributors on contracts which call foi the weekly delivery of a stated number of casks, the price to be fixed + on the basis of what is known -as the weekly ‘Copenhagen quotation.’ | “The balance of 30 per cent to 35 per cent is sold on the open market. I “On Thursday,, two committees—one representing the factories, including a factory manager, and the other representing the buyers, including Danish exporting houses, meet separately in Copenhagen, and by comparing notes, arrive at the average price of the free butter sold during the week. The two committees then meet as one committee and agree on the average price of such sales and this is published as the Copenhagen quotation, on which the open orders are paid “In practice, therefore, the average price of about one-third of the weekly output, i.e„ the proportion sold on the open market, automatically determines the price of the two-thirds, for which delivery is contracted.” “In contrast to, thqse,” Mr Davis continued, “100 per cent of New Zealand butter has been sold on the open market. . ■ “The development of the open order system is only possible with the group marketing scheme, whereby the customer will be assured of a regular sup* ply of the butter he wants. I am sure that there wlil be a development of this very desirable system so far as New Zealand is concerned, and, in this connection, something advantageous may come from, the visit of a strong delegation 'representing English interests, which will arrive in the Dominion about Christmas time.”