|UFDC Home||myUFDC Home | Help ||
ALL VOLUMES CITATION SEARCH THUMBNAILS PAGE IMAGE ZOOMABLE
STANDARD VIEW MARC VIEW
|Table of Contents|
Agricultural Economics Series No. 52-1
COSTS OF PICKING AND HAULING
FLORIDA CITRUS FRUITS,
A. H. Spurlock
Associate Agricultural Economist
H. G. Hamilton
A Study Conducted with Funds Provided by the
Research and Marketing Act
Department of Agricultural Economics
Florida Agricultural Experiment Stations
Cost of Picking and Hauling Florida Citrus Fruits, 1950-51 Season
Costs of handling citrus fruit, from the tree to the processing plant, for
the 1950-51 season are summarized for nine operators by type of fruit. Services
studied were buying and selling, picking, which included delivery to the road-
side, and hauling from roadside to the processing plant. All of the firms,
except two, were specializing in this kind of business. Two were located in
Lake County, five in Polk, one in Hillsborough and one in Orange County. Their
total volume for all services performed ranged from 380,000 boxes to slightly
more than 3,000,000 boxes. No sampling procedure was used in determining the
cooperators and it is not known how well the group obtained represents the in-
dustry. All, perhaps, were above average in size of operation.
Data were obtained only from firms with detailed records of actual cost.
A few items of cost were divided by estimation in order to obtain uniformity of
accounts, but total costs were not changed from the book record. Some operators
had good financial records, but no record, or incomplete record of the number of
boxes of each type of fruit handled, and were, therefore, not used in the summary.
The following is a brief explanation of how costs were allocated to the
various services performed, and distributed by types of fruit. Costs were first
obtained in total from the records, such as total labor, repairs, telephone and
telegraph. If more detail was needed on total costs, they were further analyzed
from subsidiary records or by estimation of the operator. Labor was subdivided
into classes from payroll records and piece rates.
Next, total costs were allocated to three departments or types of operation:
(1) buying and selling, (2) picking with own crews, (3) hauling, own trucks.
Some costs fell naturally into these categories; the management was asked to
estimate the allocation of some others. Buying and selling costs, and hauling
costs were not separated by type of fruit. Contract picking and hauling costs
were mixed, both as to services performed and type of fruit included, and are
not shown in the summary.
Finally, costs allocated to picking fruit were further subdivided by type
of fruit picked, into oranges, grapefruit and tangerines. Labor costs for pick-
ing were distributed by type of fruit from an analysis of the picking payroll,
and from piece rates for all piece-rate workers. Other cost items were prorated
to the three types of fruit in inverse order of the estimated average number of
boxes a picker could pick in a day as estimated by the operators. This resulted
in higher per-box costs for tangerines and lower per-box costs for grapefruit
than a straight box-basis proration would have given.
An illustration of how this works is given below:
-t t. -- Percent
,Actual no.: .Estimated number. Adjusted :distribution
Type of fruit' of boxes : Percentage 'boxes picked per' number of used in
: picked distribution* worker per day : boxes* : prorations
(1) (2) (3) (4) (5) (6)
Oranges 200,000 50.00% 65 307,692 544.7%
Grapefruit 180,000 45.00% 90 200,000 35.l41
Tangerines 20,000 $.000 35 57,142 10.12%
Total U00,000 100.00% 56, 6,834 100.00
*Column 2 t by column 4 x 100.
For a firm which picked 400,000 boxes of citrus, distributed by type of
fruit as shown above, $4.47 percent of the citrus picking costs (except labor)
would have been charged to orange picking instead of 50 percent. It will be
noted that tangerine picking would have borne 10,12 percent of the overhead
costs instead of only the 5 percent which a straight box volume would have given.
The rate of picking the various types of fruit, as estimated by the firms,
with- oanges as 100% averaged as follows:
Type of fruit Relative picking rate
The average costs per box for 1950-51 for nine firms, engaged primarily in
picking and hauling citrus fruit from the grove to the cannery, are given in
Table 1 by type of service performed.
The average volume bought and sold by seven firms was 946,780 boxes. Some
of this was hauled by contractors and some by the firms' own trucks. Nine firms
hauled an average of 617,326 boxes with their own trucks from the grove to the
cannery during 1950-51. Fruit picked by eight firms averaged 529,11 boxes each.
Of this 72.3 percent was oranges, 26.4 percent grapefruit and 1.3 percent tange-
rines. Only four of the eight operators picked tangerines with their own crews.
Buying and selling cost of citrus includes the salaries and brokerage paid
buyers, car expense, telephone and telegraph, a portion of the management and
office salaries and general overhead expenses.
Hauling costs include all drivers' and mechanics' wages, truck expense and a
portion of management and overhead costs. Contract hauling was eliminated, ex-
cept in two cases where small amounts were left in, because the number of boxes
was not determined.
Picking costs include all amounts paid labor for picking and delivery to the
roadside, grove truck expense and a portion of the management and general over-
head expense. Picking labor was allocated to the types of fruit from payroll
analyses and piece rates. Costs for workers not paid on a piece rate were pro-
rated on an adjusted volume basis as illustrated on page 2. The average cost
per box of 17.61 cents for orange pickers as shown in Table 1 represents a
composite of all rates paid during the season. Most operators reported paying
15 cents per box for picking budded oranges and nine cents per box for grapefruit
early in the season, with increases up to 17 cents on oranges and 10 or 11 cents
on grapefruit later in the season. Rates for picking seedling oranges were
higher than for budded fruit and varied from 20 to 30 cents per box. A rate of
12 cents per box was noted on a few grapefruit. It was not practical to separate
Table l.--Average Costs Per Box of Picking and Hauling Citrus Fruit, 1950-51 Season.
: : ick All Operationst
Buying &:PHaulinicking : Buying & Selling,
:Selling : Picking & Hauling
Selling : .Oranges.Grape- :Tange-. Oranges:Grape-:Tange-
: : : fruit :rines : :fruit :rines
Number of Operators : 7 9 8 8 4
Average Volume boxes :946,780 61l7,326:382,661: 39,s98- 7,152:
Cost Per Box Cents
Field Foremen 1.36 1.20 2.45 1.36 1.20 2.45
Pickers 17.61 10.22 38.48 17.61 10.22 38.48
Loaders 2.07 1.88 2.45 2.07 1.88 2.45
Grove Drivers 1.07 .80 2.43 1.07 .80 2.43
Highway Drivers 2.23 2.23 2.23 2.23
Mechanics .01 .26 .10 .05 .37 .32 .27
Other .06 .12 .12 .05 .18 .18 .11
Total Labor .01 2.55 22.33 14.27 45.86 24.89 16.83 48.42
Gasoline, Oil, Grease .06 1.93 .69 .46 1.49 2,68 2.45 3.48
Repairs .07 2,01 1.25 .94 3.06 3.33 3.02 $.14
Licenses, Taxes, Bonds .02 .30 .17 .12 .17 .49 .44 .49
Insurance .02 .35 .24 .17 .46 .61 .54 .83
Depreciation .09 1.44 1.11 .81 1.88 2,61 2.34 3.41
Interest Operating .03 .04 .04 .02 .07 .11 .09 .14
Equipment Rental .01 .23 .12 .07 .32 .36 .31 .56
Contract Hauling .17 .17 .17 .17
Miscellaneous Expense .57 .27 .75 .53 .46 1.59 1.37 1.30
Management .76 .62 1.12 .84 2.14 2.50 2.22 3.52
Office .17 .24 .38 .27 .79 .79 .68 1.20
Buyers & Brokerage 1.80 .04 1.84 1.84 1.84
Office Supplies .03 .03 .0o .03 .03 .10 .09 .09
Telephone & Telegraph .18 .07 .09 .07 419 .34 .32 .44
Lights & Water .02 .02 .03 .02 .01 .07 .06 .05
Total 3.84 10.31 28.36 18.62 56.93 42.51 32.77 71,08
"Less than .005 cents.
the picking costs of budded and seedling oranges, but budded oranges were the
type predominately picked by all operators.
Miscellanesous expense in Table 1 includes many small items, such as freight
and express, loss on employee advances, some supplies, travel and entertainment,
advertisement and public relations, dues, subscriptions, donations, legal and
auditing, and social security and workmen's compensation taxes.
When the business was operated by the owner and the management was unpaid,
an estimated amount was added as management compensation. Some of the firms
had paid management.
The total cost for buying and selling, picking and hauling citrus from the
grove to the processing plant in 1950-51 averaged l2.51 cents for oranges,
32.77 cents for grapefruit and 71.08 cents for tangerines. Only a very small
sample of tangerines was obtained. For picking only and delivering to roadside,
costs averaged 28.36 cents for oranges, 18.62 cents for grapefruit and 56.93
cents for tangerines.
Hauling costs averaged 10.31 cents per box for all types of fruit. Oranges
weigh more per box than grapefruit, and thus the cost of hauling should be some-
what more for oranges than grapefruit. Tangerines require more careful handling
and lighter loading than other fruit and are the most expensive type to haul.
Buying and selling costs averaged 3.84 cents per box for all types of fruit.
None of the costs in Table 1 includesinterest on invested capital. Interest
paid by the firms for use of operating capital is included, though only about
half the firms had interest expense.
Capital invested in land, buildings, trucks and other equipment averaged
$86,117.00 per firm for six firms or $91.95 per 1,000 boxes handled. The volume
here was taken as the total number of boxes on which any service was performed
Interest at 5% on this would amount to about one-half cent per box.
Revenue from sales of fruit and services was obtained from most of the firms
but it could not be divided by type of fruit or service performed. Two of the
nine firms showed a loss on all operations for 1950-51, two were very near the
break-even point and two were not obtained. From rates which were reported as
current in the industry as a basis for estimating costs and prices, it appears
that most operators who made a profit, made it from the operation of buying and
selling fruit. This was hazardous and resulted in some losses but also seems to
have been the principal source of profit.
Only one record was found from which it was possible to compare the number
of field boxes picked with the number of boxes sold, cannery weight. In this
case the oranges sold during the season were 2.7 percent more than the boxes
picked, but grapefruit sold were 0.2 percent less than picked.
Variations in total costs per box for the various services are shown in
Tables 2, 3 and 4.
Table 2.--Frequency Distribution of Cost Per Box for Picking
Oranges and Grapefruit, 8 Firms, 1950-51 Season.
Total cost per box .: Oranges : Grapefruit
(Cents) Number of Firms
16 19.99 5
20 23.99 3
24 27.99 5
28 31.99 2
32 35.99 1
Total number of firms 8 8
Average cost per box 28.360 18.620
- 7 -
Table 3.--Frequency Distribution of
Citrus Fruit From Grove to Cannery,
Cost Per Box for Hauling
9 Firms, 1950-51 Season
Cost per box Number of firms
6- 7.99 2
8- 9.99 4
12 13.99 1
14 14.99 2
Total number of firms 9
Average cost per box 10.310
Table U.--Frequency Distribution of the Total Cost Per Box for
Buying and Selling, Picking, and Hauling Citrus,
Total cost per box Oranges Grapefruit. Tangerines
30 35.99 2
36 41.99 2
42 47.99 2
48 54.99 2
Number of Firms
Total number of firms 8 8 4
Average cost per box 42.$51 32.770 71.080
Exp. Sta., Ag. Ec. 50