The Gisborne Times. PUBLISHED EVERY MORNING. GISBORNE, MAY 27, 1901. DAIRYING.

Gisborne Times, Volume V, Issue 116, 27 May 1901, Page 2

The Gisborne Times. PUBLISHED EVERY MORNING. GISBORNE, MAY 27, 1901. DAIRYING.

A great deal is occasionally heard locally about co-operative dairying, and for the information of those, who keep in mind the subject of co-operation, we make extensive quotations from an article specially written for the Auckland Herald, advising farmers how to start a co-opera-tive factory. The very first movement of the initial proceedings (writes the Herald) would be to call a meeting of the farmers interested, and, if possible, to arrange for one of the Government experts to attend the meeting. The expert would give an address on the subject before the meeting, pointing out the advantages of the dairying industry, and would supply all information required. One special advantage in regard to co-operative dairying is that all the produce manufactured is of a standard quality. In the past the want of uniformity of quality in the produce was the great lack to the success of the industry, but, nowadays, in up-to-date factories, the whole output of the season can be made, and depended upon to be, equal to the sample by which it was originally sold. The fact that dairy companies can sell their produce before it is manufactured, is strong evidence of how the industry is progressing. With the confidence of Home buyers gained, Now Zealand produce is firmly established in the Home market. After the lecture has been delivered, some two or three men of tho right stamp, and who have sufficient faith in the proposal to devote their time and energy to fostering it, should take the matter up, and carefully explain by interviews, and in other way's, what it is proposed to effect to all the farmers in thedistrict. Nothing is accomplished successfully in dairying without plenty.of hard work, but with energy good money is to be made. One of the first stops is to elect a small committee, or provisional directorate, to draw up a programme of what it is proposed to do, to issue a prospectus, and to prepare articles of association. Tho last-men-tioned matter would not be at all difficult to accomplish ; probably there are many co-operative dairy companies in the colony whose articles would do with a substitution of name. Then there is a capital set of articles of association, prepared by Mr J. Sawers, formerly DairyCommissioner for the colony, which arc to bo found in one of the back numbers of the annual report of tho Department of Agriculture. Thus there need bo no expense in this connection, as there is no necessity to invoke tho assistance of a lawyer to frame the rules. The committee referred to would bo ablo to obtain any information desired by communicating with the secretary- of the National Dairy Association, or from the secretary of any existing co-operative company. It would then have to be decided by the committee, who would know their locality and its possibilities, as to the magnitude of the undertaking. In selecting a site for the factory it is advisable to have rising ground, .if possible, so as to secure a good fall for drainage, and within easy access of water. Two acres would be a sufficient area, and the situation should be a central one, the suppliers being, say, within a radius of four miles, which is about far enough for farmers to carf (he whole of their supply of milk. Tho amount of the nominal capital of the company would then have to be considered," and we will suppose that it is fixed £2OOO, that being ample for the average co-operative dairy company. Where are possibilities of extension, it is much better to fix the nominal capital at more than is likely to be wanted, on account of the trouble and difficulty of increasing the capital should it be found necessary to do so in the future. The probable cost of the land, buildings, and plant for a cheese factory, to manipulate milk of the aforementioned number of cows, may be estimated at £I2OO. This factory couid be constructed in such a manner as to allow of additions as the trade increased in volume. It is found to be the most advisable plan to confine the shareholders’ lists to suppliers only, and to make some provision for taking over the shares of those who cease to be suppliers. Shares must be taken up in proportion to the number of cows. The experience of those who have been connected with tho financing of such companies is that, tho shares should bo £5 each, as in working it is found to bo very much easier to place £5 shares than the same value in £1 shares. In the case of £5 shares the supplier takes a share to every four cows, that is, the money he takes in shares is at tho jnue of 25s to every cow that he milks for the factory, At first he pays £l, that is, 10s on application and 10s on allotment, and any subsequent calls that may be made can be stopped out of the profits at the rate of one pound per share per annum. Thus in four years the whole of tho shares that may have been taken up would bo subscribed. Of course, it is very clear that this system would not provide sufficient money for tho immediate requirements of the company, but the dairying industry is now so firmly established that any bank will advance the money on the guarantee of the directors, and the directors, in their turn, ipny protect themselves by being guaranteed by the \yhole of the shareholders. It is necessary, from the b?uk’s point of view, that the directors should personally guarantee the concern, otherwise it might be allowed to drift and becohio practically valueless, which it would be, if it ceased ’to be a going concern. If’ the patrons have taken up shares in proportion to the number of cows guaranteed by each, then _arrangements may be gone into for borrowing the necessary capital to commence jyith, The bankj of course, will have to be paid the current rate of interest for money, and therefore tho sooner the farmers them, selves find the necessary capital the better. A sufficient number of cowb haying

been secured, and shares allotted in pro' portion, the company may then be registered and permanent directors appointed. Needless to say, it is essential to have an expert manager and secretary. No greater mistake could be made than to try and work on the “ cheap and nasty ” principle as regards the officers of the company. The difficulty in securing a suitable manager may be overcome by letting the manufacture of the cheese by contract. This practice is becoming very general, and is found to work admirably. The price for manufacturing the cheese varies according to the size of the company; the larger a concern is the less it would cost per pound to have it manufactured, but the average cost may be put down at 4s per hundred pounds. It always takes a long time to arouse interest in a project such as sketched ; probably six months would pass from the time the movement reached this point until a factory was erected and work commenced. It is a pretty general rule to start the season on the Ist of September, or as near that date as possible, therefore the company should be registered and prepared to attend to the buildings and other work by the Ist of March, if they want to open by the following season.