SHOULD DIRECTORS SELL?

Pahiatua Herald, Volume XXXVI, Issue 10922, 24 August 1928, Page 5

SHOULD DIRECTORS SELL ?

OR CONSULT SUPPLIERS?

One of the suppliers to the Tararua dairy company raised a very pretty point at the annual meeting of the company on Wednesday. Referring to the fact that the directors had, without consulting the suppliers, sold half tlie season’s output of cheese at 9£d per lb f.0.b.. Mr Cooper questioned the •wisdom of the action. He was of opinion that 'this was n, consignment year and that factories which let their cheese go on to the- market upon open consignment would “come out btkter than 9|d per lb.” In any case the directors should first of all consult the suppliers, said Mr Cooper, and see what they had to say about it.

The point led to a very animated discussion, the chairman. Mr A. Hay, pointing out that 105 s per cwt was a pretty good average sale and meant Is 8d per lb to suppliers for every pound of butter-fat supplied. It meant, too, that the directors could with confidence make monthly advances to suppliers of Is 6d per lb, whereas it was u-nlikely that the advance would he greater than Is 3d per lb if they were on open consignment, the business of the hoard being to safeguard the- interests of the company if no sale was assured. Several other speakers agreed with the chairman, while others pointed out that it might have- been better “to wait and see if we could have got. a better price later on.” It was pointed out that the price the directors had sold at was not- now available to dairy companies and that quite a few in this district were wishing that they had sold when the Tararua company directors had. Finally, the secretary, Mr J. G. Brechin, suggested that as nobody could tell what the market was going to be and know whether or not the board had made an error they “should wait until this time next year, when everybody would know' all about it.” Apparently this advice was deemed quite sound, and the matter was not further pursued.