CO-OPERATIVE FRUITGROWERS.

Otago Witness, Issue 3352, 12 June 1918, Page 7

CO-OPERATIVE FRUITGROWERS.

ANNUAL GENERAL MEETING. SOME INTERESTING DISCUSSIONS. The first annual general meeting of the Co-operative Fruitgrowers of Otago, Ltd., was held in the Town Hall at Alexandra on Thursday. Mr John Bennetts (chairman of directors) presided. Thero was a very large attendance of members, probably upwards of 100. The proceedings lasted all day, and extended well into the evening. In a few opening remarks, the chairman congratulated thoso present on turning out. in such, large numbers to the first annual meeting of the society. He thought it was an oxcollent indication of tho very active interest that was taken in the affaire of a busing that was very closely allied to their own welfare. —(Applause.) ALTERATION OF ISTTLEB. The first business entered upon by the mooting was the consideration of a number of alterations to the rules. Briefly put, tho •proposed amendments aimed at giving the society power to establish agencies, purchase business, and generally acquire property. These matters wero not provided for in the

old rules, and had given rise to_ certain difficulties in the working of the society. The Chairman moved the adoption of the new rules, the motion being seconded by Mr J. R. Webb (Cromwell). | Mr Aslin (solicitor to the association) gave ! an explanation of the rules at the request of the chairman. They aimed, he stated, at placing tno conduct of tho business in tho hands of the committee of management. I Tno amendments were necessary because ot ja judgment recently given in the Supreme Court by Mr Justice Sim, and in conjunci tion with the solicitor acting for the Central Produce Mart it had been decided to formulate these new rules. The effect of the judgment was this: that the company had power to give debentures for any money that was owing or borrowed, but it had no power to give debentures for a business that had been bought. Tho court had held that under tho old rules tho company had no power to make that purchase ,but the judge suggested that if suitable rules were passed that power could be provided for, and these rules had been framed in consequence. As soon as they were passed by the meeting tho company would bo in a position to complete the contract entered into and partly completed. At this point Mr E. 0. Reilly (manager) read a letter setting forth his own position ' in relation to the negotiations which had taken place, and stating that he desired to havo his position as manager clearly defined, I more especially regarding the policy to be ! formulated by tho board of management for ' the future. If that policy did not givo him absolute freedom of action in connection with the management, then he was not prepared to go any further with the negotiations for the sale of the business of the Central Produce Mart to the society. Tno Chairman said Mr Rcilly's letter had nothing whatever to do with the resolutions before the meeting. The now rules simply gave the society power to purchase a business, and in no way restricted its selection to the Centnl Produce Mart. It could pure laso any other business if it suited the members to do so. Mr D. LesK=> asked if the power given by the passiig of those new rules was going to vary the arrangements that had already been made. The Chairman: It may do so, but it docs not necessarily follow. I Mr Aslin said the agreement would be I carried out as eoon as tho society had j placed itself in a position legally to make ! a contrast. Tt had been agreed to pay Mr Reilly £2OO in cash, £2OO in shares, and the balance of £3OOO was to bo raised by debentures, £IOOO worth of which had to be paid by the 25th of this month. Mr Ashworth said that the business has been taken over, and 'the company was under a moral obligation to fulfil the terms of its agreement. Tho motion adopting the amended ruleswas carried. DATE OF ANNUAL MEETING. A resolution, submitted by the Management Committee, fixing the date of the annual meeting for some time prior to September 30 was discussed.—Mr Davidson said his association wanted the meeting held some time in June.—Mr S. A. Stevens said September was ton close to the season to suit most members. —After a good deal of discussion, in which reference was made ! to the closing of the society's books as a factor in arranging tho date of tho meeting, the resolution was carried, and the committee was given power to fix a date moet suitable to all. I ELECTION OF RErEESENTATIVES. Mr T. F. Dobson (Ettrick) moved, in ] accordance with notice, that Rulo 22 be i amended to read as follows:—"Members shall be entitled to nominate and vote for only the representative of tho district to which they belong." Under the old rulo every member of the society was entitled to vote on an election for a representative of any particular district. Mr H. Thomson seconded the motion N Mr A. Davidson (Alexandra) said his association had instructed him to support tho motion, but in his own mind ho was ! opposed to it. They could quite easily Rot 1 business men in Dunedin to represent the | whole of the fruitgrowers of Otagp —men i who were connected with orchards in. each I of the particular districts. The association in the position that it waa not always

able to get the best men in each district to represent it—(" Question."), —for the reason that they could not always spare the time to fro. Mr Duthie said lie would oppose the motion because it was a retrograde step, and ho thought they should go on broader lines. He was afraid that there had been a little personal clement brought into it in connection with Kttriek, and he did not think this should bo done. Mr Briefly suggested that a representative should ba nominated and seconded in his own district and voted for by the whole meeting. Mr Webb opposed the motion because it limited the choice, and the association needed the best men wherever they mightcome from. Mr J. B. Gilmour supported 'the amendment, but he said that to make it absolutely fair it needed an addition to the effect that every district should elect its own representative, but he need not necessarily be an occupier in that district. Mr Kirkwood seconded the amendment. The Chairman suggested that the matter was one that could be conveniently brought forward again at the end of six months, and this course was agreed to. ANNUAL BEPOHTS AND BALANCE SHEET.^ The annual report had been prepared in part by the chairman and in part by the secretary. The report submitted by the chairman read as follows:—"Liko all companies, wo have had our initial difficulties. In a concern liko ours, where we are trying to organise all the fruitgrowers of Otagc into ono distributing and selling centre, wc must expect difficulties which can only be overcome by the exercise of patience and loyalty. It would bo unwise of mo to say that the business during the reason, from a fruitgrower's point of view, has given entire satisfaction, as there have been disappointments. I, as a grower, have had my own share. Still, I am hopeful that the cause of these disappointments will help us in the future to improve our methods, and if members will bo loyal to the society and give it all their support, there is no doubt wo will find that the Co-operative Society will bo ono of the best ventures the fruitgrowers ever went into. We were fortunate in being able to acquire a ready-made business, with staff and premises, which enabled us to start with last fruit season. Otherwise wo might have had to let the season go by. As it was, our time was rather short to get our outside selling agencies properly organised before the rush of the season was on us. Wc are hopeful that wo will have these agencies better organised before the next season, - and thereby materially assist our head office in its work. During the season I have been asked why the 'direct to consumer trade' was not pushed. Tho short time at our disposal has been responsible for this, as we had insufficient time to organise an efficient system. Such a system cannot be started in a day, and your board felt that by waiting we could instal a system which would not only be successful, but would relieve the markets during the season when tho gluts of fruit were coming in. As members are aware, tho society tried the system of the averaging of prices, but difficulties arose, and the committee found it necessary to abandon the system in the meantime as from January 31, 1918." The Secretary (Mr H. F. Tayton) submitted the following brief resume of the financial part of the business of the society as from October 1, 1917:—-"In the first place I desire to state that although the business of the Central Produce Mart was purchased as from September 1, 1917, the purchase was based on tho balanco sheet of the Central Produce Mart as at September 20, 1917, and tho society has practically been trading for six months only. It was well on in the season before the duties of secretary were handed over to me, and it left very little time to organise and cope with the increased volume of business. From an accountancy point of view tho pooling and averaging has proved a very cumbersome business, the amount of detail work required being enormous; and when I state that it took three men practically three months to complete the pooling for January alone members will get a rough idea of the vast amount of detail work involved. In addition to the consignment business of the (shareholders, wo had also to record the transaction of clients who arc not shareholders, and the turnover put through on. their behalf reached a considerable amount. The amount of turnover under trading account was £10,230 10s 7d, showing a gross profit of £927 16s 3d, which may be considered very satisfactory. Of course, this amount must naturally stand its share of overhead expenses. Tho turnover derived from shareholders' ■consignments amounted to £12,229 4s 8d; from non-shareholders' consignments, £9824 2s lOd; trading turnover, ex Dunedin, £10,230 10s 7d; turnover from our agents, £14,231 13s Id;—making a total of £46.515 lis 2d. The commissions earned therefore aro made up as follows: —Account shareholders' business, £IOBB 9s 6d; non-share-holders' business, £B6B 5s sd; agents' business, £3Bl 2s 7d; account Dunedin trading, £927 16s 3d;—total. £3265 13s 9d. This result is very satisfactory. The charges against profit and loss account are certainly very moderate, and certain charges that aro necessary in a new business will be nonreourring. None of the charges appear very heavy; wages account being the largest item, but this amount would not have appeared so large had it not been for the extra cost of pooling. The amount of expense incurred by the pooling was £244 12s 6d, and the number of cases and half-cases dealt with in this connection totalled 40,365. Full depreciation has been allowed for on plant, office extension, and electric lift installation. A proportion of preliminary expenses and all ascertained bad debts have been written off. A sufficient reserve for bad and doubtful debts has also been created. Thcro is a considerable amount of allotment moneys still unpaid. The total number of shares held to March 31, 1918, was 3499, but since that date several shares have been deducted from proceeds of account sales as provided for bv tho rules of the sociot3'. Financially tho business has proved a thorough success for tho short period of its existence." THE REPORTS DISCUSSED. The chairman supplemented his report by making a strong plea for unity and loyalty amongst growers, and for a firm belief in the ultimate success of the cooperative movement. _ Loyalty and unity were needed, along with the fixing of a payable price—not an exploiting price—for their fruit. —(Applause.) The Fruitgrowers' Co-operation was the strongest organisation in connection with_ any industry that had over been known in tin's country in proportion to the number engaged in it. It was idle to say that thero had not been disappointments, and this was only to be expected in the initial stages of such an organisation; but they were only "opening

tha ball " as it were, and had not yet completely ficttled down into thorough going order. The concluded by striking a not2 of optimism regarding the future, stating that growers could feel assured that they would receive prices that would pay them for tho expenses entailed in the industry.—(Applause.) The balance sheet was then read by the secretary, and was received with applause. The Chairman moved tho adoption of th ! reports and the balance sheet. Mr Webb seconded tho motion. Mr Davidson said that there were some shareholders who had not yet received" their advances for consignments;—in fact some of tho consignments had not been accounted for at all. In reply, tho secretary said that there were a few matters of that kind which would have to be gone into in order to adjust discrepancies. These were very few, and they did not amount to much, and were largely due to the fact that tho time at his disposal for tho preparation of the balanco sheet had been extremely limited. The chairman had a recommendation to make regarding the balance, and there would be a reserve of some £3OO with which to meet any discrepancies. Mr E. F. Duthie said the amount of business totalled roughly £46.C00 on a subscribed capital of £II,OOO. and he thought they could fairly claim that the association had made an excellent start.—(Hear, hear.) He thought that was duo to the foresight of the committee in securing an established business, and also to tho fact that the members had sent their fruit through the association. He fully recognised that at a time liko this, when the Empire was at war, one could not expect the same conditions as in normal times, and tho difficulties were rendered more acute by the impossibility of procuring outside markets and the difficulty in the way of buying orchard stocks. After the war was over, ono and all must bo prepared for great advances. During his short association with the concern he had come to the conclusion that there was no limit to tho extension of their organisation, provided three sound business principles wore observed. First, their business must be run on sound business lines; second, their finances should bo arranged so as to enable them to adopt a broad and progressive policy ; and third, they must have absolute loyalty amongst the committee of management, the manager, and tho shareholders.—(Applause.) Thero were many matters requiring adjustment before next season that had arisen through no fault of the management or tho committee, but it was only by experience that they could find the weak spots. He did not think, for instance, that anyone would claim that their grading scheme was satisfactory, and ho was convinced that it was affecting the success of the industry as a whole. It should certainly be put on a better footing. Fresh markets were also required, and he believed there was under consideration a scheme for the wider distribution of the fruit, and also for sending the fruit direct from the grower to the consumer. Another important point which had been discussed by the committee was the" question of having a standard size- of cases ■whereby tho fruit could bo sold by the case and thus prevent the enormous waste of time and labour caused by so much weighing. He had. been told that growers did a great deal of averaging'of weights, and he lipped it was not true.—(A Voice : Too true.) The waste of time that occurred by the weighing of the fruit, first at the orchard, then in the auction rooms, and finally by the buyers, must bo running into four figures every year, and surely by adopting a standard size and guaranteeing the weight a great savinp- could be effected. Dealing with tho question of averaging, Mr Duthie said he was tho only director who had deliberately opposed the coming into operation of the averaging scheme, and he had had his dissent recorded in the minutes. He was satisfied that the scheme was not a fair ono in the present condition of packing, grading, and transit, nor was it fair to the grower who was honest** when there were known to bo careless and even dishonest growers and packers. No conditions could bo fair and honest until they had absolute uniformity of grading, and until transport to the markets was equalised. If grading sheds were going to get over that difficulty they should bo established as soon as possible. Proceeding, Mr Duthie said he wished to congratulate those shareholders who had exhibited at tho Auckland show on their success. Ho _ thought they were entitled to every credit, but at the same time he could not congratulate the fruitgrowers on not being represented as a province. They had practically passed a resolution that they would do so, and it was greatly to be regretted that an exhibit worthy of Otago had not boon forwarded. In conclusion, the speaker said he felt confident that tho association had a great future before it and would do much to extend the fruit industry in Otago. A certain number of mistakes nad been made, but it did not do to attribute all these to the manager, and it did not _do to consider that everyone should bo infallible. —(Loud, applause.) Mr D. Smart askorl what relation the cost of running tho business bore to the amount of work transacted. Mr Webb said that, considering the turnover, the expenses had been very small. He thought the position was a very creditable one. Tho motion for the adoption of the reports and balance sheet was carried unanimously. DISPOSITION OP CREDIT BALANCE. On behalf of the committee, the chairman then made the* following recommendation for disposing of the balance of £541 at credit of the profit and loss account: — Payment of a dividend of 7j. per cent, on contributing shares, £3l; directors' fees, bonus to manager and staff, £180; balance carried forward to reserve, £330; total, £sll. This was adopted.

Mr G. Moodio moved that tho feo for the directors bo fixed at £ICO for the ensuing year. —A good deal of discussion followed on the point whether a larger sum should not be fixed, but tho motion was eventually carried. On the motion of Mr -J. Sparrow, it was decided to charge 6d for each fruit case as from October 1. ELECTION OF DIRECTORS. The following directors were elected unopposed:—Messrs D. Leslie (Ettrick), A. Ashworth (Alexandra), and H. C. Campbell (Dunedin), the last-named being elected in place of Mr Duthie, who had resigned, and who declined re-nomination. The representation for Taiori was left in the hands of the committee, with the recommendation that Mr E. Pinder (chairman of the local association) be appointed, subject to his formal consent. A vote of thanks to the directors for their services during the past year was carried by acclamation.

Mr Davidson said th > Central Otago Association was of opinion that the office of chairman should bo a rolling one, but the matter did not get the length of a resolution, it bailiff in the nature of a recommendation to the incoming committee. Messrs W. E. C. Roid and Mr G. M. Mae Lean were reappointed auditors at the same remuneration as last year. PRIVATE OHDKIt TRADE. Mr R. Kinnaird introduced the question •oT the regulations governing the duties of shareholders to the association, and also to their private order customers. A great deal of discussion followed. Mr Aslin, in reply to a question, said an orchardist working under contract could complete the contract, but he could not make a new agreement. Mr Webb moved, and Mr Kinnaird seonded, a recommendation to the committee that members bo allowed to purchase from each other for the purposo of fulfilling household orders. Mr'Gilmour moved as an amendment, and Mr Sparrow seconded—" That the agreement be left as it is at present, and thab the whole matter of distributing direct to the consumers be left to the association to develop this class of business."' It was finally decided to refer both resolutions to the incoming committee for its consideration. ruLriXG PLANT. Mr J. Wing introduced the matter of establishing a pulping plant, and an interesting discussion ensued, in the courso of which it was stated that a great deal of waste might be obviated by that means.It was also remarked that the matter was one regarding which the growers of New Zealand should approach the Government.— It 'was decided that the association should go into the qufcstion, and obtain all the necessary information from the Toviot and Ota go Central Associations.