NETHERTON RATEPAYERS

Hauraki Plains Gazette, Volume XXXIV, Issue 4538, 12 March 1923, Page 3

NETHERTON RATEPAYERS

ADDRESS DY MR. LEONARD* NEW DAIRY COMPANY PROPOSED. A meeting of the Netherton Ratepayers’ Association was held on Friday- last to hear an address by Mr Leonard, of Auckland, on the advisability of forming a co-operative dairy company at Netherton. Mr T. Vowles presided over an attendance of over fifty. •*. Mr Leonard, who was greeted with applause apologised for the absence of Mr Stopford, who was unable to be present. -Mr Leonard said he was not present to do propaganda work or to influence any person as to where he should send his milk. He had nothing to do with the trouble at East Tamaki, and did not know of it until after it had happened. A small dairy company owned and controlled by the people is a good institution. The control of the big company had centred in Hamilton, and the suppliers felt that control had passed out of their hands and that the managers had managed the farmers and thereby encouraged the desire on the part of farmers to start, on their own. Several factories had proved successful ventures. Success in business consisted of the elimination of waste, and in a small concern this matter could be watched. The N.Z. Dairy Company's East Tamaki factory was doing a fair amount, of trade in town supply of milk at is a gallon, and when the figures came out they could not see any benefit. That was the root of the trouble. A number of suppliers had asked him to help them, said Mr Leonard, and though there was a cheese factory at feast Tamaki, a company was formed. For 12 months cream was manufactured in Auckland by contract, and the returns were higher than those which they had previously received. Npw they had built a butter factory of their own, so as to be independent of the town supply demand. The N.Z. Dairy Co. had asked the East Tamaki Dairy Co., to sell them their factory. There were some 84 suppliers to East Tamaki, and about. I's to the N.Z. Dairy Co.’s cheese factory. . The Auckland Milk Co. asked the East Tamaki factory to take their surplus milk to be made into casein, continued the speaker, but this could not be done, so it was sent to the N.Z. Dairy Co.’s cheese factory, thereby supplementing their supply. Now the two concerns, were working harmoniously together. The East Tamaki Company made a final attempt to buy the N.Z. Dairy Co.’s cheese factory when they talked jof putting up the buffer plant, but were refused, and an offer to lease the factory for five years was also refused. If a rival factory were started in this district, said Mr Leonard, there was a good chance of being able to sell out. ’ A proprietary factory had been started owing to the discontent with the big company. They thought they could make it a paying proposition and pay out as much or more than the big company. There was nothing in supplying butter in pats. Anchor brand brought the company Is 6%<i, and if shipped overseas would bring more. Most of the other companies had withdrawn and left the local trade to the N.Z. Co-opera-tive Dairy Co. The Hinuera factory started with the supply of 50'0 cows, and the Frankton factory started with an estimated output of 500 tons. If •new factories had - not started, the N.Z. Dairy Co. would have been embarrassed to handle the supply, as the increase had been very great. If a small factory is to be started, said Mr Leonard, the finance can easily be obtained. It -would need £6OOO, or £7OOO A local factory tends to bring the suppliers closen together,, and was a very desirable and profitable institution.'

In reply to questions Mr Leonard said that one share was allotted for every 1001 b of butter-fat at the Hinu- . era factory. The cost, of a dual plant factory would be £BOOO or £9OOO if the conditions in regard to site and facilities were favourable. He had not heard of any BastTamaki supplier who 1 asked for .the return frora the N.Z. Dairy Co., of his snare capital, or that the company had calledup the unpaid capital. The Hinuera Dairy Company's irianufact.uring cost wpuld compare favourably with any other concern, but the actual figures could not be ascertained until the end of the financial year, it would require a guarantee from every supplier to supply and to‘ sign a joint and several guarantee. ■ Twenty-five per cent, of share capital would have to be subscribed on the allotment of shares, and the deductions would be up to Id per lb of but-ter-fat. The liability would cease when share capital was paid up if the cost was fully met by the number of shares issued. He could not give full information at a public meeting, butif a committee was formed more ini' formation could be given. The small ,1 companies were quite prepared to let the NIZ. Dairy Co. have the local market. The East Tamaki Company consigned all their butter at f.o.b. prices, They made about 200 tons, ■ and the cash pay-out' after deducting 8s 4d per share was Is and the final pay-out fpr/the year was on July 20. If they had not been lucky they might have paid out the same as the N.Z. Dairy Co. He was not prepared to state the cost "of manufacture at different sized factories, as every factory had its own method of calculating this, so there was no standardisation and various factors affected the case. The real test was what the supplier received. He did not know the cost of manufacture at the Hinuera factory. He considered it a breach of trust to disclose the internal affairs of the Hinuera company. Mr Buchanan said/that the N.Z. Co-operative Dairy Co. had always required the cost of a factory to be covered by the shares issued,, and if this not done the company could show 4 a better pay-out at the present. TEST MOTION. Mr F.’ Johnson moved, to test the -"feeling of the meeting, that those present form a co-operative company of their own. Mr. W. Richmond seconded.

Mr Leonard said that if a company was formed every supplier would be required by the associated banks to sign a joint and several guarantee, but no one need lose an hour’s sleep. In his experience of dairy companies he had not, known of any man who had been called upon to pay. Mr Buchanan said he knew of a case where not only was a*~Jbint and several guarantee required, but also a P.N., payable on demand. Mr Leonard said a butter factory for 400 ions would cost £2OOO for buildings, £3OOO for plant, and £lOOO for drainage, men’s quarters, etc. Twenty-five per cent, of this (£1500) would be paid on allotment of shares. On the motion to form a co-opera-tive company the voting was : FOr, 12 ; against, 7. On other questions concerning the Hinuera factory being put to Mr Leonard he repeated that as he was the chairman of directors and a paid official he did' not think it fair to answer those questions at a public meeting. Mr F. Johnson moved that a committee of seven should be formed to canvass the district tp ascertain the number of cows available. Seconded by Mr W. Richmond. Mr Buchanan proposed that the canvassers who take around the petition state op what basis the proposed factory be financed, and that, they take around a specimen joint and several guarantee form. It was suggested that this was putting the cart before the horse. The amendmnetZwas seconded by Mr B. Dunlop, and on being put to the meeting was lost, by a. three .to one majority. On the motion being put it was carried by seven to two. The following were nominated a committee to canvass the district. Messrs T. Vowles, W. Richmond, .1. Johnson, R. Whisker, U. Taylor, B. Johnson, and H. Goble. It was decided'that the committee meet in seven or eight days’ time: A vote of thanks to Mr Leonard was moved by the chairman and carried by acclamation. .A vote of thanks to the chairman was carried by acclamation. At the request of several men Mr G. Bucha'nan explained the position in regard to the affairs of the N-.Z. Cooperative Bacon Company.