Aspects of Big Business Explained

THE simple recital of an ordinary day’s doings of Armour and Company’s

beef department will make plain a number of things that may appear

mysterious to a casual observer. Each day, at the opening of the

market, the manager of the beef department must carefully weigh the

possibilities of his sales and shipments of beef carcasses against the

receipts of cattle of the quality demanded by his trade. And he must

buy accordingly.

The prevailing idea that, because of cold storage facilities at

the packing centers, unlimited numbers of cattle of all grades and

qualities can be absorbed and slaughtered, is wrong. For even though

cold storage capacity were unlimited, beef cannot be held. Each day’s

kill must find room in chill and storage rooms by the shipment of about

an equal number of carcasses _out_ of storage to Armour’s branch houses

located in all parts of the country.

These branch houses must, in turn, dispose of each shipment promptly to

make room for new arrivals. Each branch manager receives a memorandum

of the cost of the beef, and of course is expected to sell it at a

profit. But he _must_ sell it within a very limited time, even if he

cannot show a profit.

Local conditions determine this. He may meet with unforeseen

competition in the kind of meats he has ordered, or the demand for

meats may have fallen off for one or a dozen of reasons, or for no

discoverable reason at all. These known and unknown influences on the

demand govern his market and he has to accept the situation, depending

on evening up the score under more favorable conditions.

Of course a decline or advance at one or a few branch house points,

from merely local causes, does not materially affect the market at the

packing centers, but any widespread fluctuation from general causes is

immediately reflected in cattle prices at all of the great markets.

The best way for a producer to learn what determines the price he gets

for his livestock is to visit the nearest Armour branch house and get

first hand information on the facts that govern meat prices at the

final market.

Any Armour branch manager will welcome visitors and willingly answer

questions. He will explain not only the factors that influence the

general level of prices, but will point out why cuts from certain types

of beef carcasses are in constant demand at the highest prices, while

similar cuts from other carcasses are neglected and sell materially

lower.

There is a type of beef carcass that is best and commands the best

price, and it costs no more to produce than an inferior type. The same

is true of mutton and pork. Any Armour branch manager will show you

what these types are and the Armour Farm Bureau will furnish, without

charge, information on improved methods of producing the sort of

animals that are most in demand for meat purposes.

One aspect of the big packing business, the importance of which is not

generally appreciated, is refrigeration. It is not too much to say that

without ample means of refrigeration, both in storage and in transit,

no fit and adequate supply of fresh meats and dairy products could be

supplied to the public.

Food refrigeration originated with the meat packing business early in

its history. At first only storage refrigeration was practiced for

the purpose of conserving and equalizing the supply of fresh meats

for local or near-by consumption. Then came the conception of transit

refrigeration, and the refrigerator car was invented, primarily for the

purpose of shipping fresh meats from the producing centers of the West

to the consuming centers of the East.

From the transportation of fresh meats, the extension of the service

to the carrying of fresh fruits, vegetables and dairy products was a

natural and easy step, resulting in the development and maintenance of

the great orchard lands and fruit and market garden areas from coast to

coast, and the tremendous expansion of the indispensable industry of

dairy farming all over America.

To the livestock producer refrigeration in storage and in transit means

everything. Without it the great packing interests could not exist and

livestock husbandry would revert to the primitive and unprofitable

conditions prevailing fifty years ago and described in the preceding

chapter.

These facts explain why Armour and Company have persistently

opposed every attempt to deprive them of the exclusive use of their

privately-owned refrigerator cars and turn them over to the railroad

companies for general use. To maintain the necessary constant movement

of meat products Armour must have an adequate supply of these cars

every day in the year. Extended experience has proven that they would

not and could not be supplied by any form of railroad administration,

either governmental or corporate, yet devised.

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