If the ownership costs can be
controlled, the farm can be profitable.
But since the banana farm typically is
small to begin with and since the gross
margin is fairly small, we can expect
profitability to be relatively sensitive to
the size of the operation. Table 4 summa rizes the ownership costs in the same
"costs per pound" terms in which the
operating costs were expressed.
costs. The total pre-harvest growing
costs amount to about 11 1/2¢ lIb.,
almost a third of the 38.1¢ received for
the pound of bananas. Harvesting,
packing and shipping costs add almost
15¢ /lb. more, for a total of a little over
26¢ per pound, about two-thirds of the
amount received per pound of bananas.
The gross margin is almost 12¢ /lb.,
about one third of what was received for
the bananas. This amount is what
remains to pay the ownership costs.