Across the
Editor's Desk
Editor’s Note: This article by
Henry R. Geisinger, executive
vice president of the Penn
sylvania Association of Milk
Dealers, is reprinted in full from
the December issue of The
Pennsylvania Golden Guernsey
News:
Pennsylvania’s greatest
agricultural enterprise is
seriously threatened as the result
of new and vicious attacks on the
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milk industry of Pennsylvania.
Milk, for decades, has provided
more than 40 per cent of the total
farm income in the Keystone
State—growing every year—and
returned $447,304,000 m 1971. In
addition, it has provided steady
employment for thousands of
dairy plant workers dedicated to
full consumer service. This
money constantly is fed into the
economy of the Commonwealth
Size L 38V/', W 18’/.", H 26"
at all municipal levels, in all 67
counties.
The new charges vary.
Basically, however, the asser
tions are that (1) all Penn
sylvania milk prices are higher
than the rest of the nation, (2)
Pennsylvania farmers are NOT
doing as well or at least no better
than their counterparts in other
states; and (3) Pennsylvania
milk price control favors dealer
profits and encourages “inef
ficiencies ”
Most of the price comparisons
are made between those charged
by a limited service New Jersey
operator with non-union help and
those charged by fully unionized
full-service Philadelphia dealers
The former offers some dairy
products on a cash and carry
basis only. The Pennsylvania
operators provide a variety of
products for all who need milk—
not just those willing and able to
run to the store and buy it, where
it may be sold on a loss leader
basis.
Our ‘Crime’ Is Service
If Pennsylvania dealers have
committed any ‘crime’ it is that "
of ‘too much service.’ In this
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JOHN DEERE RIDING TRACTOR/CYCLES
A. B. C. Groff, Inc.
New Holland 3544191
Lancaster Farming, Saturday, December 18,1971 —
consumer oriented era, the
Pennsylvania dealers strive to
offer a full complement of dairy
products in a variety of types and
sizes of containers—not just
homogenized milk in a bulky
gallon jog. And Pennsylvania
dealers do not have a store full of
other products to help make up
any milk losses.
The Pennsylvania dealers are
willing and DO service schools
(at a much reduced price),
hospitals, shutms and all others
who need it In addition, Penn
sylvania dealer—dedicated to
service—offer monthly credit
with no 1 percent charges for
delays in payments so common in
other commercial ventures
today Few, if any of these ser
vice are offered by the dairy
store operators They also charge
for containers
Pennsylvania prices are not
established to give any one
segment of the buying public a
bigger advantage over others
They are established so milk may
be made available to all at
reasonable prices Admittedly, it
costs less to bottle large con
tainers and sell them at company
owned stores, but permitting
such low price sales skims off the
bulk of the market and puts an
even greater burden on the full
service operator. As a result,
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prices must be raised to com
pensate.
Pennsylvania prices are not the
highest in the nation when all
products and all types of services
are compared—not just using one
product in one area The rest of
Pennsylvania does NOT pay the
same prices as Philadelphia
where in-city deliveries bring
considerable problems and high
costs.
Many products available in
various types of containers are
considerably cheaper than in
many sections of the country The
recent statement that Penn
sylvania consumers are being
“milked” to the tune of some $6O
to $BO million annually has no
documentation. The figure ap
parently was arrived at by taking
the total volume of milk sold and
comparing the highest price in
this state versus the lowest price
in another state
Dealers May Get
Less Here
It must be remembered that
when milk is purchased in a store
that there is adequate margin for
the storekeeper, and this is NOT
■ ealized by the dealer at all.
Storekeepers are entitled to a
profit on milk, the same as for
bread, meat and other items sold
They have wages, rents and taxes
to pay, too. In fact, dealers may
get as little as 87 cents per gallon
when the store picks up the milk
at the plant (the price in New
Jersey is 96 cents).
Only half truths are given m
these attacks.
The second assertion is that
Pennsylvania dairy farmers are
not making out in comparison
with other states Since New
Jersey appears to be the “per
fect” dairy state, let us look at
their situation In 1950 New
Jersey dairy farmers had a cash
income from milk of $59,465,000.
Then came the battle of milk
control with charges and counter
charges one is hearing now in
Pennsylvania In 1970 the New
Jersey farmers had a milk in
come of $46,857,000—0r a
reduction of more than
$10,000,000 in two decades. And
they produced more milk in 1970
than in 1950.
In Pennsylvania the income in
1950 was $248,000,000 while in 1970
it was $447,594,000—it nearly
doubled.
Similar comparisons can be
made with other states. Penn
sylvania farmers are enjoying a
return<is good, if not better, than
most states.
Inefficient
Dealers Fail
The third criticism is that
Pennsylvania milk price control
means high profits for dealers
and that it encourages mef
feciencies If this were true, there
would be little or no loss in milk
dealer ranks In 1950 there were
864 milk dealers licensed in the
state Today, there are 312 The
inefficient dealers were forced
out of business the same as in any
other commercial enterprise
Meanwhile, the attacks con
tinue, and the public begins to
lose confidence in a great Penn
sylvania industry at the expense
of headlines and publicity If the
price is a bit higher, it is because
of service Ar,d this service truly
must be measured in penme _ .
milk service costs less than the
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9