BUTTER CONTROL

New Zealand Herald, Volume LXXIV, Issue 22823, 2 September 1937, Page 13

BUTTER CONTROL

AUCKLAND MARKET dealers in the dark NO DETAILS OF -SCHEME SPECIAL LOCAL PROBLEMS Auckland butter distributors have had no official information so far about the details of the local marketing scheme which, it is expected, the Government will shortly introduce in the Auckland district. The first scheme of the kind lias boon operating in Wellington and Hawke's Hav since May 1, tihl it i s believed that generally similar provisions will be applied here. However, those"in the trade are hopeful/ that modifications and adjustments will lie made to suit local conditions, which are materially different from those in/ Wellington. No difficulty is expected in applying control to the provincial towns and country districts, where retailers niostlv draw their supplies of butter direct from the nearest factory. The whole problem is found in the Auckland metropolitan, area and the nearer country districts that are supplied twice weekly by vans from the city. Higher Distribution Costs This area of supply is very large, extending at least, from Papakura in the south to Brown's Bay in the north and including a large number of seaside- stores and other retail establishments in out-oi'-the way places. Owing to the lesser density of population in the suburbs, there are proportionally manv more small foodstuff shops than in Wellington.

It is estimated that I'2oo retail shops aro served by -Auckland distributors' vans, compared with 600 in Wellington wild between and 330 in Cliristehureh. "As many of them take only 201b. of butter or less twice a week, tho cost of accounting and general overhead is considerable. 11l fact, it is considered in the trade to be a heavier, item than the actual cartage. There arc 15 distributors altogether, of whom live or six may be regarded as engaged almost wholly in the business and as having substantial facilities. ! Halfpenny Margin Not Enough " The main questions that concerns, us,." said one distributor yesterday, " are .whether the 'Marketing Department will take into account the proportionately greater costs in Auckland as compared with Wellington, and whether it will allow us more than tho margin of id a podud that is allowed there. The Wellington distributors are complaining that ]d does not cover their co<t*. ]f the department insists on tlui same margin here, tiie only course will be to cut out a large proportion of the very small shops altogether. That would be a great pity, because such Ehofs in the aggregate sell a very large quantity of butter. I hey live to a large extent on the forgctfulness of housewives, and if /their butter trade is stopped there will undoubtedly be a fall in consumption, some of it temporary and some permanent."' Factories' Goodwill Will Go This informant styd that in Wellington the department had taken over the distributing business of Pieot Brothers, Limited, and had established a depoi through which passed all butter for coi/suinption in the metropolitan area The department itself supplied the best of the market, including the large Btores. It had also licensed five private concerns, who, worked on the }(I margin. A charge of an eighth of a penny 'was made upon the factories for the Services of /the depot. The five firms were the best-equipped of the former distributors, and the others had been eliminated.

" The most unfortunate part of the scheme is that? it will wipe out the goodwill of those factories that have specialised in supplying the local market and have built up a substantial demand for their butter," said another distributor. "One may well ask whether they will continue. If they take to exporting instead, it, will mean that the department will have to commandeer supplies for the local trade, and in that cpse it is unlikely that the consumer will get such good value." No Consultation Offered , It was gathered yesterday that individual Auckland firms had given their views to the department in recent months, but that so far the department had made no effort to consult the Auckland trade as a whole, and distributors had no idea of its intentions. Their present hope is that a round-table conference will be called in order that the whole matter may be fully discussed before regulations are gazetted. One point mentioned yesterday was that in Wellington the department appi-opriated all excess receipts due to the fixing of wholesale prices in sixteenths of a penny a pound. I.i was also pointed out that no attempt was being made to fix retail prices directly.