eA AA Weg AOU NOE Ra TY
Thesis for the Degree of M. Agr.
Stantey J. Brownell
yas
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Market Milk Problems
of Michigan.
Cc
a
Cy)
MARKET MILK PROBLFMS OF MICHIGAN.
Thesis
Submitted to Michigan Agricultural College for
the degree of Master of Agriculture.
By
Stanley J. Brownell.
\ \ ~ C La Le
1922. |
Foreword.
Many of the problems of the market milk incustry
have been purposely omitted because of the writer's close
association with the following Bulletins covering these
subjects. A great amount of information and statistics
given in these bulletins was gathered by the writer. In
order that this thesis on market milk problems may be used
as a reference on the subject in the future, the author is
placing with the thesis these bulletins.
Special Bulletin No. lll... ee eee we eee eee ee ee Nov. 19e1
Special Bulletin No. 99 2... cece ccc c we ween Nov. 1919
Bulletin No. 286 ......... 0 cece eee eee eeeees Jan. 1920
495
OR ee “a
Outtine REDD ASME pune ga eye
iW Le eo ye OS
Page
Part I. The Producer
The Supply 1
The Surplus 3
The Price of Milk 5
Cost of Production 6
Opportunity Costs 11
Relative Profitableness le
Part II. The Distributor
Distributors' Problems 15
Receiving 18
Processing | 19
Bottling and Carping 20
Refrigeration and Power el
Delivery Costs 22
Influenced by
1. The Demand of the City
2. Administration by the Distribu-
tors
5. Administration by the City
Salesmen and Collections
Advertising
Part III. The City Ordinance
Results of the City Ordinance
Decreases Delivery and Improves Service
Raises the Plane of Competition
Improves the Health of the City
ee
25
yy
46
49
49
50
22
Market Milk Problems of Michigan.
Stanley J. Brownell.
Introduction.
The problems of the market milk industry are those
which relate to the efficient administration of the milk
supply of a city. These problems are undoubtedly brought
to the attention of all classes of people oftener than
those of any other edible commodity. A large proportion
of our preducers are directly interested in dairy products
either through the sale of dairy products or as a market
for their crops through the dairy cow; also processing and
distributing of milk for direct consumption represents the
average sized industry of a city. But possibly greater
than the above interests is the fact that practically ev-
ery person is a daily consumer of milk, which suggests to
him with amazing frequency, problems of the market milk
industry. These problems invariably refer to the effi~
Giency of administering the supply of milk to a city.
Part I.
The first essential in administering the milk sup-
ply of a city is to assure an adequate supply of pure
milk of a good quality. Cities that have had milk short-
ages extending over several days or more realize how de-
pendent they are on milk for nourishment; and especially
for nourishment of the infant and invalid class.
One factor tending to insure an adequate supply of
desirgable milk is that of making a yearly market for the
producer. To produce milk of a certain quality and sani-
tation requires definite care and equipment, which causes
extra labor and expense. It is impractical for a milk pro-
Gucer to be required to change his market to one which re-
ceives a lower class of milk. Not only is it impractical
to change, but milk companies refuse to take on new patrons
that are not expected to stay permanently.
The Surplus Problem.
The main cause of companies turningavay short time
patrons is the milk surplus problem. The policy in the
past has been for the dealer to care for the surplus prob-
lem because of the stabilizing effeot it has on his supply.
His yearly supply is determined largely by the number of
patrons necessary to meet his demand during the period of
low production, which is also the period of greatest con-
sumption. In order to be assured of his required amount
during this period, he handles his patrons' supply during
the rest of the year. Patrons that change to another mar-
ket during this period of low production (usually because
of higher price from another company) could not expect to
ohange back when the dealer is well supplied. The same is
true of the dealer who turns his patrons away during the
surplus season. Under this condition producers find dif-=
ficulty in locating a new market which often causes them
considerable loss. Producers who have been handled in this
manner are reluctant in patronizing such dealers.
Where producers are organized for the purpose of sell-
ing their milk, consideration should be given to the idea
of caring for their own surplus. In some instances such
organizations have been encouraged to assume entire re-
sponsibility for all surplus milk. This would then enable
the producer to furnish to milk distributing concerns the
exact quantity cf fluid milk which the market demands.
Thus all loss on surplus, due to the lack of facilities
for handling the same on the part of small dealers, would
be eliminated. The author approves of the theory of pro-
Gucers caring for their own surplus. However, from obser-
vation of two of the largest milk producers! companies in
the state and an intimate knowledge of one by having worked
with it, the writer does not believe that they will be an
entire success.
The Price of Milk to the Producer.
Not only must the producer of milk be assured a
yearly market for his milk in order to continue his
service of production, but he must also receive enough
for his milk to be consistent with the quality, sanita-~
tion of his product, and the perpetuity of his service.
Cities efficiently administering their milk supply,
require of the producer a certain standard of health, sani-
tation, and quality not required by condenseries, cheese
factories, and creamerieés.
This market milk requirement may necessitate extra.ex~
pense on the part of the producer in the form of extra
labor in keeping his barn clean, extra expense in testing
his herd for tuberculosis, frequent delivery, icing, and
insulating during delivery, etc. Dealers must pay a pre-
mium to the producer in order to get the above service as
required by the city. The producers profit or loss at the
end of the year, compared with the profit or loss of the
other farm enterprises, determines to a large extent wheth-
er or not he will stay in the milk business.
There are three methods by which the farmer may ana-
lyze his business to aid him in determining whether or not
he will continue to produce milk. These three methods are:
l. Cost of Production Method.
2. Opportunity Cost Method.
4« The Relative Profitableness Method.
Cost of Production of Milk.
From the year 1912 until after the war, cost of pro-
duction of milk hag played a very important part in the mar-
ket milk industry of Michigan. During this time the idea
that the farmer should get more than the cost of production
of milk spread very rapidly. In 1914 so much interest was
manifest in knowing, from a reliable source, what the cost
of producing market milk really was that Mr. Riddell was
sent to the territory producing market milk for the city of
Grand Rapids to determine the costs. The figures obtained
in this work aroused such interest that in the spring of
1916 the largest and most enthusiastio meeting ever held at
the college for the purpose of marketing a single commodity
was held in room 402 of the Agricultural Building. At this
meeting the Michigan Milk Producers' Association was organ-
ized for the purpose of getting cost of production for their
producte Previous to the time when the Milk Producers' Agso=-
Clation became effective as a marketing agency, the differ-
ence in the price paid the farmer and the cost of production
of milk was very. great; following this time it was nearer
as shown by the following table:
Table No. I. This table shows that the year pre-
vious to the influence of cost of milk production data
and a milk producers’ organization there was a 44 per cent
loss; but during the two years immediately following the
time the average yearly loss was 0.955 per cent in produc-
ing 100 pounds of milk.
Before Organization 1916 to 1917
Cost to Price Received Profit Loss
Time 100 los. for Milk at Plant © owt. ont.
of Milk
March $2.196 $1.526 wevees $0. 664
April 2.204 LO lee ee 764
May 1.625 1.236 = = —§ .aeeee » 389
June 1.389 1.112 jj — — — waeee. 277
July 1.830 1.226 vie. , 606
August 2.314 1633200 ww . 983
September 3.184 Le447 ke ee 1.737
October 2.665 1.832 a ee eee » S344
November 2.700 2.00 = = — — ceeeee 696
December 2.389 2.029 seeee - 360
January 2.205 2.091 . -114
February 2.174 2.102 . .072
Winter
Season 2.298 1-795 j= = = aaeee ~500
Summer
Season 1.344 1.275 ss te ee -569
Yearly 2.147 1-625 = = — savas . 524
Per Cent 24 41
equa
After Organization 1917 ~- 18.
Cost to Price Received Profit Loss
une 100 lbs. for Milk at Plent owt. ont.
of Milk __
March $2 .236 $1.92 = = — .aeaee $0.254
April 2.357 1.79% ne ew we -563
May 1.775 1.839 $0.064 .....
June 1.491 1.834 345 kee.
July 1.755 2.014 -259 sn a ae
August 2.435 2.192 Lees 243
September 2.300 3-155 wee ~ 855
October 3.456 2.777 eee -679
November 3.418 2.785 wae 633
December 3.276 3.124 wae .152
January 3-275 5-178 wee 097
February 3.284 3.103 eas 181
Winter :
Season 2.911 2.592 eee 289
Sumgeaeon 1.966 2.033 -067
Yearly 2.596 2.405 wee -191
Per cent 7-36
1918 - 19.
Cost to Price Received Proft Loss
Time 100 lbs» for Milk at Plant © ewt. owt.
of Milk
March $3.584 $2.94. jj = §...... $0.643
‘April 3.429 2.524 — — saesee -905
May 2.302 2.104 = Lecece .198
June 1.704 1.835 0.131
July 2.182 2.239 .057
August 3.401 2.717 . 684
September 4.498 3.050 1.448
October 3.820 3.294 -526
November 4.199 3.408 791
December 3.919 3.562 ~ 357
January 3.472 3.493 021
February 3.279 3.337 -058
vee eeagon 3.550 3.134 416
Sumgeason 2.603 2.343 -260
Yearly 3.249 2.881 ~ 368
Per Cent 12.77
10
From the above table it is quite evident that with
the price of milk below the cost of production, farmers
still continued to produce milk. This leads one to believe
that the farmer does not use an analysis of his business en-
tirely to determine whether or not he will stay in the milk
rroduction business. It is quite evident that the personal
element plays an important part in his decision.
At the same time the cost of production was playing
such an important part in the supply of market milk, op-
portunity cost was also having its effect on the supply
and price.
ll
Opportunity Costs.
Opportunity costs arise from the fact that on most,
if not on all occasions, one is confronted with more than
one thing he can do or would like to do. During the war,
farmere were confronted with many enterprises from which
to choose, all of which were paying liberal returns. It
took but slight provocation on the part of the city ad-
ministrators during those times to change the entire out-
look of the dairy supply of a city. Not only did the farm-
er limit his opportunity costs to deciding what he wanted
to produce on his farm but he also decided between farming
and other industries. During the period of high wages, many
farmers quit farming entirely and went to the city as shown
by the following figures taken from the 1920 Census report:
Table No. II. Showing chinge in number of farms in
Michigan since 1900.
Date Number of Farms
1900 203,261
1910 206,960
1920 196, 447
Although both cost of production and opportunity costs
methods had a very great effect on the market milk supply
during and immediately preceding the war, undoubtedly the
relative profitadsleness method of figuring costs has had a
greater effect on the market milk supply than either of the
other two ideas.
Relative Profitableness Method.
The relative profitableness method undoubtedly is the
logical way for a dairyman to analyze not only his farm en-
terprises, but his dairy enterprise within itself. It is
the system of reasoning which decides the farmer to stay in
the business, as well as to decide whether it is cheaper for
him to gend his milk to the condensery for a lower price, or
meet the city requirements and send to the city for a higher
price.
Possibly greater than the two afore mentioned reasons
in influencing the supply of market milk are the generally
considered secondary reasons Which enable dairymen to stay
in the business When average conditions are showing & loss.
Relative profitableness brings out the advantage of labor
distribution in favor of the dairyman, the advantage being
in the ability of the dairy farmer to have a fairly constant
labor requirement the year around. This same reasoning de-
termines the unprofitable: units in the dairy herd which en-
ables the farmer to increase his profits over the average
farmer as shown from the following table:
Table No. JII.
1)
Showing the increased production for a herd
of seven cows over a period of three years as a result of
keeping individual records of each animal in his herd.
1914 1915
Milk Fat Milk Fat Milk Fat
lbs. lbs. lbs. lbs. lbs. ‘lbs.
5816 374 6307 378 6514 423
7958 338 9473 396 10348 LO
4605 26 5421* 311° 7319* Lo0*
4380 2ok 5862 320 7765 417
5516 238 S00 3&9 4200* 229%
2387 157 6623 410 7335 yy
3252 179 S340 432 9827 549
*%
33914 1756 50626 2636 53608 2880
ee
L646 250 7261 377 7658 412
* These animals replaced animals of the previous year.
** Totals
*** Averages
Not only coes he analyze his dairy herd but also his
method of handling the herd, such as: does the milking
machine pay, does the silo pay, likewise, litter carrier,
location of grain, arrangement of barn, etc.
As previously mentioned the personal element is a
factor to consider. Undoubtedly many men will continue in
the dairy business even though it showa a loss. In many
cases this is due to ignorance as to returns on the enter=-
prise. Often it is merely because of love for the dairy
cow. Occasionally a farmer makes the dairy pure bred in-
dustry primary to milk production.
293
Part II.
The Distributor.
Frequently cities after much trouble in establishing
an adequate supply of pure milk of a good quality find them-
selves confronted with another problem of equal importance.
A satisfied consumer is every bit as important as a satisfied
producer. Since the city milk consumer deals directly with
the distributor, these problems are mostly settled through
the distributor. |
In order to efficiently administer to the city milk
supply through the distributor, the consumer wust be assured
that the dealer renders most cheerfully and efficiently the
necessary and needful service at as low a cost as may be con-
sistent with the quality and perpetuity of his service.
In order for the distributor to be able to do this, his
net financial returns must be such as to warrant his invest-
mente The price of milk to the consumer has often been the
subject of much controversy. Leaders of different city fac-
tions have made cheaper milk part of their campaign platform.
Municipal milk plant campaigns are based almost entirely on
the subject of cheaper milk to the consumer through central-
ized efficiency. When a city commission attempts to admin-
ister the price of milk to the consumers, they should first
consider the distributor as a public servant that is very
16
desirable, because of the utility he creates. The public
demands his service; and in order that it be maintained,
his financial returns must be such as to warrant his in-
vestmente
Not only must his net financial returns be such as
to warrant his investment, but he should be allowed suffi-
cient spread in price to guarantee quality and sanitation
of product. Clarification, pasteurization, refrigeration,
and general sanitation - all of which are necessary for
Quality of product = cause a considerable added expense
and must be considered when the city milk administration
demands a quality and sanitary product. The greater the
demand of the administration for quality. and sanitation.
of product, the higher the price of milk must be to the
consumer.
Not only must his financial returns be considered
from the standpoint of investment, quality, and sanitation;
but all processing charges must be allowed and distributing
costs taken into consideration as well. These costs come
under the following general headings.
Divisions of Labor, or Enterprises in the Distribution
of Milk.
1. Receiving.
Weighing, testing and can washing.
1/
Processing.
Clarification, or filtration, pasteurization,
and loss in pasteurization.
Bottling.
Bottling, capping, bottle washing and sterilizing.
Refrigeration and power.
Cooling, temperature room, machinery operation,
pasteurization and sterilization.
Delivery, Salesmen and Collectors.
Advertising and Administration.
Receiving.
In order to assure quality of product, the receiving
room is essential. It is here that the amount of milk de-
livered to the plant by each producer is recorded for pay=
ment at the end of the month. As important as the record=-
ing of amounts delivered by each patron is that of check-
ing the quality and cleanliness of the product. It is here
where the sweetness and keeping quality of the milk is de-
termined, bacteria counts are made, and butter fat tests
are run to encourage quality as well as a standard for pay-
ment. Dairy companies, in cities enforcing these sanitary
and quality regulations, have large receiving rooms costs,
amounting to as much as ten per cent of the total distribut-
ing costs. To better insure a sanitary product, milk com-
panies must return to the farmer his cans in a clean sterile
condition which necessitates can washing and sterilizing
equipment. Also an occasional check is made on the quality
of milk by running acidity tests and sediment tests. Re=
ceiving costs, where sanitation and quality are disregarded,
are practically negligible.
Processing.
Processing costs also increase with the sanitary re-~
quirements. Although the ideal is to obtain milk as free
from contamination as possible, it is always necessary to
submit the milk to certain processes in order to put it on
the market in a desirable condition. Sediment and small
particles of dirt are bound to get into the milk under ex-
isting conditions. These must be removed and all unsani=-
tary conditions corrected before it is allowed to go to the
consumer. In order to accomplish this, the better dairies
and city ordinances are requiring pasteurization and either
clarification or filtration. The old idea of putting on the
market milk as it was received from the producer saved the
distributor approximately ten per cent of his costs. At the
same time it caused considerable inconvenience and epidemics,
as well as extra cost to the consumer because of the splendid
possibility to spread disease through unsupervised milk.
Efficient pasteurization removes the danger from path-
cgenic organisms, where herds are not subject to inspection,
but at the same time increases the cost of milk. Extra -
equipment is added which requires more labor, more power,
and more steam, as well as loss of milk, which amounts to
about twenty per cent of the pasteurization costs.
20
Bottling and Capping.
The old method of selling milk from a can by dip-
ping or drawing into a measure and pouring into a con-=
tainer hung from the hitching post or sitting on the door
steps is till in practice in some Michigan cities and in
many of the towns. People interested in public health
have long discriminated against this practice and have
brought such pressure to bear that in the places where
better milk administration is in order, the bottling of
market milk is enforced. The requirement of a separate
container for each customer's milk has added greatly to
the expense of the milk dealer. The usual custom under
these regulations is to deliver retail milk in glass bot-
tles of quart, pint, and half pint sizes; and wholesale
milk in cans of one, two three, five and ten gallon sizes.
All of these containers after being delivered are exposed
to all the various sources of contamination which may ex-
ist in the city. This necessitates thorough sterilization
upon return to the plant. The filling of the bottles, their
capping, washing, sterilization, breaking, losses in de~
livery, and cases for handling them add approximately fif-
teen per cent to the distributing cost of milk.
2d
Refrigeration and Power.
Because of the great demand of some of our larger
cities for an adequate supply of milk, it is necessary to
gO long distances into the country to obtain this milk.
In the larger cities it is not unusual for milk to be three
days distant from producer to consumer. Because of this
condition and the extremely perishable nature of milk, re-
frigeration is one of the important phases of the modern
milk industry. Plant refrigeration in most milk plants
with over five delivery wagons is by mechanical means.
This particular phase of the business requires over seventy-
five per cent of the needed power of the plant. For this
reason refrigeration and power are taken together. This
division of milk plant management ranges from two to four
times the cost of either receiving or processing. Milk re~
ceived at the plant one day is processed and not delivered
until the next morning. This requires a large cooling room
where the milk must be stored over night in order that it is
in @ good condition to go on delivery the next day. Cooling
the milk to a low temperature before bottling also requires
@ large amount of refrigeration.
Other poWer required to operate the plant is used in
Operating the can washer, bottle washer, bottler, and past-
eurizer. These all require some steam as well as does the
heating of the plant during winter months. In better ar-=
ranged plants, the exhaust steam is used for these purposes.
Delivery Costs.
The delivery of milk from the milk plant to the door
step of the consumer is the largest single cost item in the
milk distributing business. From thirty to sixty per cent
of the costs of the milk business can be accounted for by
a study of the delivery system. There are three general
causes which influence the costs of delivery.
l. Demand of the city.
ee Administration by the distributors.
5. Administration by the city.
The Demand of the City.
The demand of the city may be divided into two classes.
First, the demand on delivery through the location and plan
of the city that may effect efficiency of delivery. Second,
the demands of the consumers themselves.
The arrangement of the city in delivery of milk plays
&@ very important part in efficiency of delivery and also has
&@® psychological effeot on the consumer. Cities, which are
badly cut by rivers or by many railroads passing through
them, or cities which have centrally located large manufact-
uring plants, cause a large amount of detouring and extra
travel on the main crossings. Many cities are laid out ac-
cording to the topography of the country, or for certain
landscape designs which often cause unnecessary driving or
walking to deliver the milk. Large estates, houses far
23
apart, parks, and boulevard drives all extra time and
labor to deliver milk.
Greater than the arrangement of the city in influenc-
ing the cost of milk, are the demands of the consumer. Al-
though it is from the consumer that the complaints arise as
to too great a duplication of deliver, it is the consumer
that demands that another dealer serve him rather than the
dealer who serves his neighbor. Many things influence the
consumers to patronize different milk dealers. Individual
tastes vary. Some prefer pasteurized milk flavor, some
Holstein milk, some Jersey milk, some certified milk or
grade A milk, while some who have been raised on farms
where dairy methods are careless condemn milk as being
flat and tasteless unless it has a dirty or cow barn flavor.
Dealers strive to serve these pecularities, but it 1s
impossible for one dealer to carry milk which meets all the
above requirements. This necessitates different dealers serv-
ing a single neighborhood, in order to supply the demands of
the consumer. This extra service is not only due to pecu-
liarities of taste and quality and sanitation, but many other
personal reasons. Dealers who sell cheap milk obtain one
Class of people for their patrons. Some people desire cred-
it dealers. Some prefer cash payments. Relatives or friends
occasionally eoccount for an extra distributor in a territory.
Difficulties between customer and dealer, such as misunder-
standing in charges, returned bottles, stolen milk, stolen
money, etc. causé people to demand the service of an extra
dealer. Invalids and babies often call for a special milk.
The writer has observed two milk men serving a single fami-
ly because they wanted a certain class of raw milk for the
baby, but preferred pasteurized milk for the rest of the
family. Generally the consumer demands a great amount of
service and the distributor makes a very great effort to
meet the demand. Efficient administration on the part of
the city would tend to regulate excess delivery by stand-
ardizing the product. This would limit the demands of the
consumer. Also the service of the distributor should be
regulated as shown later in this thesis.
Administration by the Distributor.
Every distributor makes an effort to deliver his milk
efficiently. To aocomplish this he strives to get greater
efficiency out of his deliverymen. The efficiency of the
Geliveryman in handling his own route has more to do with
the efficienoy of delivery than any modification the oity
could make by handling the routes collectively. This being
true, the city administration should first strive toward
the efficiency of the deliveryman or the unit of delivery.
There are several things which stimulate efficiency of
delivery, chief among these is the method of payment of the
Griver. Since it is the personal element which affects to
& large extent the sales of a driver, anything which tends
to improve this element tends toward greater efficienoy. To
this end, the paying of the driver a commission on his sales
encourages him to do better work as well as more work. A
peculiar feature of milk delivery is that the deliveryman is
not the average laboring man, but must be considered as a
salesman as well as deliveryman. This extra ability requires
@ higher class of labor. The following table will show the
cifference in sales between companies which pay their drivers
On & commission plan and those which hire on a straight salary.
26
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30
Bottle Costs.
Another method of control of the cost of milk to
the consumer through the delivery service is the payment
of the driver for bottles returned, and in case of whole-
sale trade to charge for lost bottles. This gives the
driver a better appreciation of the vaiue of milk bottles.
He takes more interest in his employer's business and has
@ greater incentive to gather more of the bottles which are
&® great expense to the dealer. The following table shows a
a@ifference in the number of bottles returned, where the driv-
er is paid for returned bottles over the number of bottles
returned by drivers on straight salaries. The following
figures were taken from the books of the companies with which
the writer worked, rather than by actual check at the unload-
ing platform; this was done because when drivers discovered
they were being checked on returns they made an extra effort
to collect empties which almost invariably showed a greater
number of bottles returned than were taken out. For this
reason only those companies which checked returns are used
in this table.
Table No. V. Showing the number of bottles returned
monthly where the drivers are paid for returns and when
not paid for returns.
Drivers Paid for Returns Drivers not Paid for Returns
Bottles Taken Bottles Taken Bottles Taken Bottles Taken
Out In Out In
13154 13315 6200 6014
19658 20018 8773 525
13422 14131 9689 9827
16315 16353 6541 6324
12681 13497 10819 10261
20363 204g 7006 6820
16962 17462 74721 7347
18606 18700 14415 14291
15040 14552 17205 16802
15547 15954 12090 11749
10365 10582 18693 17980
18005 17318 13113 13206
14575 14213 30566 21080
13093 13707 15066 14911
$352 $726 12803 12431
23262 21790 8556 S742
13772 13810 11439 11129
12026 11906 16833 16771
Table No. V. (Continued)
Drivers Paid for Returns Drivers not Paid for Returns
Bottles Taken Bottles Taken Bottles Taken Bottles Taken
Out In Out In
16738 16554 11346 11160
11271 11161 17298 17391
17340 16984 14756 14539
11478 11616 5053 5053
16681 16333 4743 4557
11752 11876 18724 18352
17100 17732 17360 21204
13209 12903 21049 21142
15247 14957 12648 12369
12186 11555 19530 19499
15440 14787 18693 18507
10506 10554 19530 19592
7517 7675 18972 19127
9883 10256 20491 20243
16019 15746 16926 17205
* 477565 RTTAT7 164597 A5R150°
** [0072 14460 14079" 13762
* Total
** Average
The problem of bottles for the distribution of milk
is of great importance in keeping down the distribution
costs. Enormous losses have been caused by the loss of
bottles either through the failure of the consumer to re=-
turn bottles or breakage in distributing or bottling. fFig-
ures Obtained by the writer of the loss of bottles are shown
in the table on the following page. These figures were es-
timated by obtaining the number of bottles purchased in a
year by all the distributors and checked with the figure
obtained by finding the difference between the bottles taken
out for delivery and those returned.
Not all of the bottles are an actual l0ss as some deal-
ers charge for lost bottles. Some of the larger plants with
bottling machines often sell to small merchants with hand
cappers those bottles with chipped necks which co not work
well in the capping machine.
The question often arises as to what becomes of the
milk bottle. The writer in studying the situation has found
them in many placese To begin with it should be remembered
that there must be an empty and a full bottle in the home
for practically every bottle delivered, and also that there
must be three bottles in the plant or on the wagon for every
bottle delivered. This represents five bottles in circula-
tion for every bottle sold. The tremendcus number of bottles
needed by a city in which to deliver ite milk is shown by the
J+
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table on the following page. Undoubtedly the greatest
loss of these bottles igs due to thoughtlessness on the
part of the consumer. During the spring clean up, the
writer has gathered on one milk route as many as three
cases of bottles from rubbish placed on the street to be
hauled away. One company with which the writer worked,
hired men to gather bottles from the city dumps during
this season of the year. The inconsiderate house wife
takes advantage of a free container to put away for the
winter certain canned goods. Many private garages find
the milk bottles convenient for small amounts of differ-
ent kinds of oil.
Another thine which causes a demand for extra milk
bottles is the pint and half pint milk business. The con-
tainers for a quart of milk sold in pints and half pints
cost more than the container for a quart of milk sold in
&@ quart package. Not only do the containers cost more but
the breakage is doubled and the losses are doubled. Not
Only on the cost of the container but when the price paid
the producer for milk is excluded, the cost of placing a
pint of milk on the door step of a consumer is practically
the same as to place a quart there. For this reason there
should be a difference in the price of quarts of milk when
delivered in quart bottles over the price of a quart of milk
when delivered in pint or half pint bottles. When this dif-
350
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ference is made the deliveryman is not subject to the
criticism which sometimes occurs when he tries to reduce
the number of bottles in his load.
Generally speaking, dealers have been doubtful about
the advisability of making the change in the price of pints
Over quarts, but when once the change has been made there
is never any question as to the advantage. There are some
local conditions entering into the question but these are
usually negligible when the larger distributors of the place
agree to the policy. The following table shows some very
interesting things relative to the subject. At the time the
change in the price of quarts in quart bottles and quarts of
milk sold in pint bottles was made, the sales were really af-
fected, but they rapidly established themselves in favor of
the distributor before the month had passed.
During the war when the price of milk steadily increased
the tendency was to decrease consumption. It was generally
supposed at this time that a change in the price of milk in
pint and quart bottles would produce the same effect. Fig-
ures taken in the city of Flint which made the change at
this time, prove the contrary. Milk which sold for fourteen
cents for quarts and seven cents for pints was raised to fif-
teen cents for quarts and nine cents for pints. The consum-
erg immediately cut down on their purchases so that some
loads decreased as much as thirty per cent, while others re-
mained about the same. For the entire city, the amount of
2°
milk fell off about twelve per cent for the first week.
This gradually changed so that by the end of the month
the amount of milk sold was practically the same and any
loss in sales was more than overcome by increase in profits
on pints.
The city of Lansing made a difference in price of milk
in pints and quarts on a lowering market in November, 1920.
Milk was selling at fourteen cents for quarts and seven cents
for pints. The first of December the price dropped to twelve
cents for quarts and pints remained the same. The first few
days the attitude of the people was to take a quart every
Other day instead of a pint, but apparently when they bought
& quart they used it as they needed it and more often used
a quart every day until at the end of the month, the total
amount of milk sold had increased and this at a time when
the city was going through an industrial slump.
Kalamazoo, the third city studied, was uninfluenced by
economic conditions or change of population. The price of
milk previous to December 10th, 1920 was fourteen cents for
Quarts, and seven cents for pints. This was then dropped to
twelve cents for quarts and pints remained the same. After
the change in price there was no marked change in amount of
milk sold, although the proportion of pints to quarts changed
greatly.
a?
The following tables show what actually took place,
not only for the city, but for e@ach dealer in the three
cities studied.
Table No. VIII. Showing the effect of changing the price
of milk when sold in pint bottles and when sold in quart
bottles.
Before Change in Price
Per cent Per cent Per cent Proportion of
sales of milk of bottles pints tc quarts
City sold in vints
pints
Lansing 100 45.96 62.97 1.701
Kalamazoo 100 48.75 65.54 1.9021
Flint 100 23.21 37.68 6047
After Change in Price
Per cent Per cent Per cent Proportion of
sales of milk of bottles pints to quarts
City sold in pints
pints
Lansing 101.46 17.87 30.33 4353
Kalamazoo 101.95 28.24 4.05 -7872
Flint 100.71 13.09 23.15 -3012
Table IX.
- and pints in city of Lansing by dealers before the change
No.of No. of No. or
Pts.
Wagons Qts.
in price.
Showing the comp2rison of delivery of quarts
Pts.
to milk
Proportion Per cent or
of
sold
Per cent of
bint bottles
__ Qts. in Pts. a
11 2094.98 4045.65 1.931 49.12 65.88
1 155 216 1.393 41.07 58.22
1 121 75 0.6 23.41 38.27
1 122 208 1.705 41.59 63.33
5 706 1409 1.995 49.99 66.62
1 3160—is«d2 4 0.582 22.55 36.80
1 109 201 1.844 46.09 64. 4
1 150 213 1.42 41.63 © 58.68
2 177 4OS 2.305 590.92 69.74
1 143 276 1.93 49.11 65.87
2 189 305 1.614 44.73 61.72
1 303 410 1.353 40.39 57-50
2 230 354 1.539 43.49 60.61
1 175 186 1.063 34.76 51.53
31 4991 S490 1.701 45.96 62.97
Table X.
pints in city of Kalamazoo by dealers before the change in
Showing the comparison of delivery of quarts and
price.
4)
No. of No. of No. of Proportion Per cent of Per cent of
Wagons Qts. Pts. of Pts. milk sold pint bottles
Qts. in Pts.
g 1524 1240 - $136 21.56 4. 86
12 2356 2209 9368 31.89 48.37
3 640 663 1.0360 34.12 50.88
1 107 4g AUSG 18.32 30.96
1 75 34 4533 13.04 31.19
2 326 138 4233 17.47 29.74
2 386 229 5932 22.87 37.23
1 210 176 8381 29.53 +5 .59
1 171 100 5848 22.62 46.90
1 209 50 .2392 10.68 19.34
1 226 50 .2212 9.96 18.12
1 172 155 -9011 31.06 47.40
1 130 56 4308 17.72 30.10
1 78 94 1.2051 37.60 54.65
1 192 152 »7916 28.36 4.18
1 254 162 .6378 24.18 38.94
39 7058 5556 7872 28.24 4.05
Table XI. Showing the comparison of delivery of quarts
and pints in city of Flint by dealers before the change in
price.
Magons te, pte: OF Ptos to milkscld” of pint”
Qts. in Pts. bottles
31 15095 4647 307 13-33 25°53
4 1242 273 .219 9.90 18.02
3 598 143 .239 10.68 19.29
2 239 118 493 19.79 33.05
3 1149 239 208 9.42 17.21
1 Sold Bulk Milk Only.
2 337 160 474 19.18 32.19
1 173 28 162 7.48 13.93
2 288 153 531 20.98 34.69
1 37 15 »405 16.85 28.84
1 180 60 © 333 14.28 25.00
1 57 13 .228 10.23 18.57
1 286 60 .279 12.27 21.85
63 19661 5929 . 3012 13.09 23.15
a,
Part III.
Administration by the City.
From the preceeding tables one can easily see that
the city administration should encourage a difference in
price of milk sold in pints and quarts. Not only because
of cheaper milk to the consumer but also because of a slight
increase in comsumption of one of our most desirable foods.
It should be quite evident from the above discussion that
there is the possibility of a great deal of difference in
the efficiency of distribution! between the different distri-
butors. The administration of the city milk supply has a
very great effect upon the efficiency of the city milk dis-
tributing system. Those cities where there is no effort to
control milk distribution show a great many wagons, much du-~
plication and general inefficiency. It is usually these
cities which are the strongest advocates cf municipal milk
plants, a franchised service corporation, centralized re-
ceiving and processing plants. The writer does not believe
in any of the above ideas as a remedy for inefficiency in a
poorly administered city. Where workable city ordinances are
enforced, inefficiency is reduced to a minimum; and politics,
shifted responsibilities, indifference through lack of com-
petition, unsanitation, etc. are eliminated.
+)
Salegmen and Collection.
Along with the expense of delivery are certain ex-
penses Which most of the larger concerns are subject to.
As previously mentioned the driver is the salesman and
collector for his company. Where there are over ten driv-
ers in one company it is necessary to a route foreman over
every seven drivers to keep the routes organized, to main=
tain closer contact between manager and men, to know the
routes in case of sickness, to instruct new drivers in milk
delivery and teach them the route, etc. These men also spend
spare time drumming up new trade, collecting bad accounts or
straightening out some of the many difficulties which may
arise between driver and customer. Some of the larger com-
panies employ men who do nothing but solicit patronage by
obtaining new customers and straightening out trouble with
established customers. In reality these men are part of
the advertising campaign of the company.
+6
Advertising.
Advertising dairy products that are under efficient
sanitary supervision should be encouraged by the city. Men
who have made a study of the subject have long maintained
that milk and its products have a greater effect on the
health and vitality of the general population than any other
single food commodity. The success and development of any
community depends to a large extent upon the health and vi-
tality of its people. Advertising dairy products thus helps
to build up the community. The first advertisement of dairy
products should start with the dairymen themselves.ancé the-men
who handle the product from producer to consumer. All of these
people should believe in their product. With them as well as
with all other people the advertising should be truly educa-
tional. It should be educational along the line of the value
of dairy products on the general health and development of
the individual and as an economical food. Deliverymen and
salesmen, educated along these lines, have a big opportunity
to increase the consumption of dairy products. The city it-
self should encourage greater consumption. It might be of
advantage in some cities to make the license fee of dairymen
high enough to finance an impartial advertising campaign to
also increase the consumption. This can be done to good ad=
vantage by offering prizes for milk contests, such as answWer-=
ing questions by grown people, making posters by school child-
+7
ren, gains in weight through drinking milk by children, etc.
It should see to it that an adequate milk supply for the needs
of all the inmates of public institutions is provided. Milk
should be dispensed through the public schools at cost, so
that at least one-half pint bottle (one glass) of milk can
be placed within reach of every school child every day at
school lunch hour. Prizes can be given for best records made
in weight and height of every school child when it shows a
relationship with the drinking of milk to undernourishment.
Data. secured on this subject emphatically demonstrates the
vital importance of milk to the growing child and suggest the
the great benefits which can be secured through systematic
recording of the children's weight and height and steps to
provide children with the milk required for their growing
needs. In no other way can @ city do so much for the welfare
of ite future citizens. There should also be established
milk depots for the dispensing of milk for infants, for child-
ren under school age, for children of the poor, at a reason-
able price. Parents should be encouraged and educated to the
value of not less than a quart of milk daily for the use of
every growing child in the family. This can be done through
cooperation with women's clubs to pass down first hand inform-
ation from woman to woman, the food value of milk as compared
with other foods and the vital necessity of milk and other
dairy products in the diet of the child, until every woman in
48
the city is familiar with all the dairy diet advantages.
That there is need for this ts shown by the following
table on consumption of milk.
Table No. XIII. Showing the consumption per capita
of milk for both city people and dairy farmers.
Consumption per Capita of Milk in Cities.
Lansing Kalamazoo Flint
Quarts Consumed 14259 13461 25969
Consuming Population 573¢7 484.87 100000
Consumption ver capita Pints .4975 ~5561 .51938
Consumption per Carita of Milk on Dairy Farms.
County Period of Families Consuming Daily
Time Studied Studied Population Consumption
per Capita
Pints
Kent 2 years 37 145 1.26
Livingston 3 years YO 179 1.36
Ingham 2 years 35 145 1.626
Macomb 2 years 33 138 1.32
Wayne &
Monroe 2 years 36 156 1.42
49
The City Milk Ordinance.
The foundation of administering a city milk supply
efficiently is a workable city milk ordinance insuring
satisfactory settlement of all problems previously dis-=-
cussed. Such an ordinance when enforced, should assure
an acequate supply of pure milk of good quality as well
as encourage the dealer to give most cheerfully and effi-
ciently the necessary and needful service at as low a cost
as may be consistent with the quality and perpetuity of his
service.
A workabie oity ordinance when enforced decreases the
amount of delivery and improves the service. The require=
ment of sanitary methods, such as inspection, pasteurization,
tuberculin test of cattle, recording thermometers, etc. is
@ direct service to the people, such as cannot be obtained
in any other way. There are also many distributors under
the old system Whose ignorance is covered up, but when ex-
posed by efficient inspection are forced out of business,
thus decreasing the number of distributors and likewise the
numbers of wagons. There is also a group of men who, when
faced with the proposition of cleaning up their herds and
barns, or pasteurizing, prefer quitting the business. Along
with these men are those who are careless, indifferent, and
carry on questionable practices. These dealers frequently
50
Change their methods and stay in business when submitted to
a new milk ordinance but even a few of these drop out. The
final result of the adoption and enforcement of a workable
Gity milk ordinance upon delivery is the culling or sorting
out of the undesirable distributor and keeping only those
desirable, as shown by the following table. This elimina-
tion decreases the number of dealers, thus decreasing the
total investment. It aids in reorganizing the territory,
making shorter drives and larger loads per wagon and so
makes possible fewer wagons. It standardizes the product,
which limits the consumer in demanding different dealers to
come into the same territory. Dealers whose products are
standardized are required by competition to hold their trade
by giving service. The early morning delivery, the special
delivery, the accommodating and cheerful deliveryman are all
reflections of a standardized product.
Not only does a workable city ordinance, when enforced,
decrease the amount of delivery and improve the service but
it also raises the plane of competition. Instead of being
& struggle for existence it becomes a dignified and legiti-
mate competition. The small bottling plant in the kitchen
or dark musty basement gives way to the well lighted sani-
tary milk plant. The small dealer with a horse and buggy
Or dilapidated covered wagon, carrying a few quarts, travel-
4
ing many miles and taking most of the day for delivery,
gives way to the modern milk wagon, well kept, handling
@ sanitary package in convenient form, covered from dirt
and dust and storme The load is such as to give a full
day's work for man and horse, and a minimum number of
miles is traveled.
The business, to be effectively administered, must
be open minded, with a forward outlook, adjustable to new
demands of public, new growths, new discoveries, and in-
ventions, and new conditions generally. But very little
advancement could be expected in the line if the old order
of things was maintained. The laboratories for inspection
and scientific research for the improvement of the dairy
business are pessible only in the larger plants. Steril-
izers, autoclaves, incubators, high powered microscopes,
and high priced scientists are impossible to the one or
two wagon basement establishment, which in general has no
objective for which it is workings
Advertising campaigns, setting forth the value of
good dairy products, are desirable to any city, educating
the people to the value of sanitation and quality by open-
ing the dairy plants to the public. It also helps to ed-
ucate the salesmen along these lines. Thus advertising
has a tremendous influence for th: better on the majority
of population and should be encouraged. This is only pos-
sible where the milk business is centralized.
The modern pasteurizers, sterilizers, bottling equip=-
ment, sanitary pumps, separators, filters, etc. are all
developments as the result of a raised plane of business.
The special milk, cream, modified milk, commercial
butter milk, special deliveries, before daylight and after-
noon deliveries are demands from the consumers met only
through the making possible of the larger distributors.
New conditions and demands can be expected of the mar-
ket milk industry in the future. The best way to provide
means to meet these conditions as they arise is through the
competing companies themselves. The raising of the plane of
competition establishes companies capable of meeting these
conditions, companies with a forward outlook, desirable to
the community and an advancement to the industry.
Modern dairy plants, such as are most desirable in the
larger cities, are operated on a soientific basis. The hand-
ling of large quantities of such a perishable commodity as
milk requires the service of a laborer with a special educa=
tion or in general above the average intelligence. The man-
agers of the different departments of such plants must be
scientific specialists in order to produce quantity of prod-
ucts in an efficient manner and in a safe and modern way.
The returns from the business must be such as to permit the
employment of such men.
2a
The problems so far discussed have dealt with some of
the economic advantages of a workable oity ordinance when
properly enforced. However, these problems are secondary
when the influence upon the health of the oity is considered.
A sanitary milk supply is a fundamental necessity to city
health insurance. Many epidemics of dissase in cities can
be traced directly to the milk supply of the city. When
disease menaces the general population of a city it is then
&@ public problem to be controlled by law. To this end the
city milk ordinance should be adopted and regulated.
Appendix.
In order to complete the thesis the following city
ordinance is appended. After studying many ordinances,
in order to formulate a suggested ordinanoe for the thesis,
the following ordinance, with a few minor changes, was sub-
mitted to the writer for criticism. The completeness of
the ordinance Was such as to supersede the tentative ordi-
nance of this thesis. So with the approval of the Head of
the Dairy Department it has been used. Credit for this
ordinance is due to the Dairy Department of the State De=
partment of Agriosulture, the State Attorney General's Of-
fice, and the Dairy and Bacteriology Departments of the
Michigan Agricultural College.
29
A City Milk Ordinance.
An ordinance to regulate and control the sale of milk
and milk products within the city of and to
provide for the inspection of dairy herds, dairies, milk
plants and other plants where milk or milk products are
produced, collected, manufactured, or sold. The city of
ordains:
Section 1. That for the purposes of this ordi-
nance:
(a) Raw milk is milk in its natural state and
which has not been treated by artificial means for the
destruction of bacteria contained therein:
(b) Pasteurized milk is milk which has been heated
to and held for thirty minutes at a temperature of approxi-
mately one hundred forty-five degrees (145°) Fahrenheit,
never less than one hundred forty-two degrees (142°) Fahr-
enheit, and then promptly cooled to a temperature of fifty
degrees (50°) Fahrenheit or lower; or milk treated for the
destruction of bacteria contained therein by such other
method as may be approved by the health officer or board of
health.
(oc) The words "milk" and "cream" when used unmodi-
fied in this ordinance shall be deemed to include milk and
cream in their raw and pasteurized states:
(d) ) The interior of the cow stable must be kept
Clean; free from cobwebs and accumulation of dust; and the
walls and ceiling must be whitewashed once within each
twelve months unless the interior of the stable is properly
painted.
(c) Manure shall be removed every day to a dis-
tance of at least 25 feet from the stable. ,
(d) An average of at least 300 cubic feet of air
space must be provided within the cow stable, for each ani-
mal kept therein.
(e) No animals, other than cows, shall be kept in
cow stables where milking is done.
(f) The cow stable must be supplied with windows
to provide an average of at least one square foot of win-
dow light for each stanchion.
(g) If a controllable flue system of ventilation
is not provided, windows must be hinged at the bottom and
constructed so as to tip inward from the top and be boxed
in at the sides to provide a means for ventilation control.
Milk Houses.
(1) All milk houses in which milk is kept that
ls offered or exposed for sale in the city of ’
shall be constructed so as to be rat and vermin proof; in-
Closed on all sides; provided with windows to supply plen-
ty of light; with doors and windows properly screened; and
of adequate size to contain a cooling tank or milk cooler;
rack upon which to store empty cans, pails, etc., and with
sutficient space to strain and handle the milk, must be pro=-
vided. The milk house shall:-be located where it is free from
contaminating conditions and is readily accessible from the
cow stable.
(2) A cooling tank (preferably of cement), of suf-
ficient depth and capacity to hold and keep cold all milk
produced on the premises, must be provided within the milk
house.
(3) All milk sold or offered for sale shall be
strained through a flannel or cotton pad strainer, and if
flannel is used it shall be thoroughly washed and boiled
after each time it is used.
Toilets.
Toilets must be kept clean and sanitary.
— 66
IN WITNESS WHERFOF, I herewith set
my hand in the City of ’
day of » Nineteen
Hundred Twenty-two.
Official Title."
In making rules and regulations it is just as in-
portant that they be made to suit the particular city as
it is in framing an ordinance. This ordinance especially
provides for rules and regulations and by changing the
rules and regulations to fit local conditions the ordinance
can be adopted in practically any city,except possibly two
or three of the larger cities in the State.
In the smaller cities where farm inspection is im-
possible, the rules concerning the production of milk should
be largely omitted, as it would be useless to establish rules
affecting the cow stable, etc., and then not do any farm in-
spection. It would not be advisable to require milk houses
unless farm inspection is provided for, and then it might
be best to only require milk houses where milk is bottled
On the farm. The very small city or village which can on-
ly afford a limited amount of inspection should be content
with a few requirements that can be enforced, rather than
have a-large number of resulations which could only partial-
ly be enforced. A village with very limited funds can regu-
67 |
late the pasteurization temperature, take samples occasion-
ally for testing, and require that raw milk come from tuber-
culin tested cattle, etc.
It shouldbe remembered that the State law may be used
by any local inspector or other individual and that the State
law covers in a general way the sanitary production of milk
and cream, established a standard for milk, cream, ice crean,
butter, etc.