The nearer to his farm the process of grad ing can take place the better it will be for the farmer. Except in the case of the very large farmer who sells on a scale large enough to make an impression on the market, selling cm grade is an impossibility for the farmer. The small farmer operating alone cannot establish confidential relations with large numbers of dealers nor can he gain such a reputation or the market as to secure the general acceptance of his grades. A large group of farmers, however, acting co-operatively, may achieve this result. Every great co-operative selling organization among farmers which has achieved notable success owes its success to its system of grading as much as to any other single fac tor. Not every farm product can be graded accurately enough to permit of its being sold by grade. Selling by sample or on inspection is then the only method. In these cases it is sometimes possible to sell rapidly, economy. and on a large scale by the auction me ,. Horses, for example, are not easily graded. So far as the writer knows they are never sold on grade. Selling by sample is obviously impossible. The auction method seems to have demonstrated its superiority over other methods in every large horse market where horses have to be sold at wholesale and in large numbers. The same method is being tried in a large number of other cases includ in such diverse products as cheese, apples, fish, oranges, besides all sorts of vegetables.
t he commission merchant is a peculiar and more or less temporary development growing out of the necessity of selling products on a distant but badly organized market. To him the producer consigns his product to be sold for whatever it will bring, the commission merchant deducting a fixed commission on the price received and returning the balance to the producer. Under this method the producer assumes all the risk and the commission mer chant none. Besides, this method invites abuses because the producer has very few and very inadequate checks upon the commission merchant. This presents temptations which human nature is not always strong enough to withstand. In a disorganized and uncertain market the distant producer frequently has no other recourse than to consign to a commission merchant. As soon, however, as the market becomes organized and the demand fairly cal culable the commission merchant gives place to the jobber who buys from the produce' and sells again, thus assuming the risk and relieving the producer of it. During the tran sition stage, however, many houses practice both methods, becoming jobbers when the market is firm and prices advancing and commission merchants when the market is unstable or prices falling, thus playing the time-honored game of eheads I win, tails you lose.) The parcels-post and express companies are beginning to serve as agencies through which the producer may sell directly to distant consumers. The success of this method is obviously limited to those products which can be accurately graded and put up in standard ized packages, in short, to those articles which can be sold on grade rather than by sample or on inspection. There is no reason, however.
why there should not be a great increase in the use of these agencies in this restricted field. Moreover, this is an expanding field. The tendency is more and more toward grad ing and standardizing all products which are capable of being graded and standardized. Be fore much can be done in this direction it will be necessary for the government, either State or Federal, to define grades more fully and accurately. To define a grade is merely to establish a standard of quality. This is com ing to be quite as important as to establish standards of quantity as is already done when the government defines weights and measures.
There is another large fact which must be remembered in any discussion of the problem of getting agricultural products from pro ducer to consumer—that is, three-fourths of all the telephones in the world are in the United States and Canada. This means that American housewives, more than, any others, have formed the habit of ordering goods by telephone. It is not likely that this habit will decline. It is more likely to grow. If it does, it means that direct selling by the farmer to the consumer is possible only with in a very limited field. The store which can always be reached by telephone and which can make a prompt delivery will have an advan tage in getting the trade of the telephone-using .housewife.
This paper may be summarized as follows: (1) From the standpoint of distribution two classes of products are grown in the United States, first, the great staple crops for which there is a well-organized market and which sell at a quotable price; second, agricultural special ties for which there is no well-organized mar ket and which do not sell at a quotable price. The latter class presents the difficult problem in distribution. (2) There are two distinct problems in the marketing and distribution of farm products, especially the minor crops and agricultural specialties. The first is that of distributing the products where they are grown within a wagon-haul of the con sumer. The second is where the products are grown at such a distance from the con sumer that the producer cannot accompany them to market. Of these, the latter is much the larger problem in the United States. (3) There are three distinct methods of selling products: First, selling on inspection; second, selling by sample; and third, selling on grade. 0 f these three methods the last is the most efficient where the product can be satisfactorily graded; but the conditions are more exacting, requiring confidence not only in the honesty of the seller but also in his skill and accuracy as a grader. (4) There are four characteristic agencies through which the producer who is distant from the market may sell his products. The first and crudest is the commission mer chant, the second is the auction house, the third is the jobber and the fourth is the par cel-post and the express service. Of these the last is the most direct but it requires confidence as between buyer and seller, besides an effi cient and accurate system of grades and standards.