The Timaru Herald MONDAY, AUGUST 16, 1909. EXIT THE DAIRY COMPANY.

Timaru Herald, Volume XIIC, Issue 13980, 16 August 1909, Page 4

The Timaru Herald MONDAY, AUGUST 16, 1909. EXIT THE DAIRY COMPANY.

Many people besides those imiuediatek concerned will echo the regrets at the failure of the South Canterbury Dairy Company, to which the chairman gave expression at the meeting of shareholders on Saturday. It adds another to the rather long list of joint-stock industrial concerns which have been premature births or have perished after a brief existence in South Canterbury. TJ egret,'- however, may be tempered, with satisfaction that the failure of the company does not involve the loss of the industry it established ; and just as the "Woollen Factory has been eminently successful ever since the company ownership was displaced by a partnership, so the Dairy Factory may flourish in the future under the management of men directly interested in its profit and loss account. The Company has a good excuse for its position in unfavourable seasons, two dry summers having been as the stars fighting against them. Another explanation which is not properly to lie offered as an excuse, is thac though the factory was started as an experiment, care was not taken to make sure that the conditions of sn< - cess were provided. The most impor' ant of these was that there should hj". n sufficient supply of milk to keep tin ixix-nsive plant profitably employed-, and the Company neglected to make sure of this by binding suppliers of liuM-r to continue t6 he suppliers, and to sinport the Company also by taking up shares in such proportions as they ought to have done. For many of the suppliers the business was an experiment on their part, and they were abi-> to give it up more easily than the dire - tors of the Company could give ir.-> theirs. The history of this company should be borne in mind'as a guide in Hie framing of future prospectuses »i joint-stock enterprises, in regard to this point: that when the success of the enterprise depends upon the active cooperation of the shareholders, they must he bound by their bargain to actively co-operate; they must not be allowed to play fnst and loose with the company as the variations of immediate

profit might suggest f° them. In other words. :i business requiring :i large capital outlay, dependent. I'nr success upon a. largo supply of raw material, huuld lie based upon a certainty of pelting it, not trust to chance, or to hopes and expectations ol' getting it. !n this east? the supply had practically io built up, and when promises to supply.were accepted with freedom to cease Mipplying.'they were not a substantial enough foundation to build a factory .■•iid creameries upon. Nevertheless, though the Company has failed through this initial .mistake, and though some one or a few people will lose money by the failure, it lias built up an industry which has been the means of circulating a good deal of money in South Canterbury, and which will doubtless continue

ti> do so in the future. Perhaps it has done even liifuv than this that it set out to do. Jt is recognised that proxiiiiity to a creamery gives an additional value to farm lands. At all events land agents and land salesmen are always careful to name that fact, if they can, among the advantages of situation of any property they have 'for sale, fi-.peeially is this the case with small farms; and accepting this as a correct opinion, the South C'anterhury Dairy Company may i'md some consolation in the thought that hy placing numerous creameries throughout the district they have to some extent facilitated the closer settlement of the land.