Honolulu star-bulletin. [volume] (Honolulu [Oahu, Hawaii]) 1912-2010, 1915-06-05

tivy would give the local merchant all the business he
could take care of without hiring extra clerks. But
the maorder business, for instance comes along and
the giant caalog houses begin to undersell the local
dealer. He finds it hard to compete''-simply because
he has known competition He has not been doing
business enough in proportion his rent and other fixed
expenses For those charges taxed his business about
the same degree whether he sold 800 $1,000 worth
menth. 9srs- ss4sFssss.=r F1-t q
So the local merchant begins TO advertise in his home
newspaper And his competitor advertises Competition
makes them both buy closely. Competition makes
them both fight for business. And, getting more
business, they better able to comprehend only with
each other but with these outside businesses which
aggressvey seek to take the trade away from home
And SO, the local merchant compete, because
through advertising he sell enough more
chandse that his cost of doing business goes down
from 500 thereabouts to where today he averages the
country over less than 800. z...
Likewise, the manufacturer grasps the golden oppor
unity that udicous advertising offers For instance the
plant that has been doing business of 100000 per year.
used to have 20 dmmers running about the country to
sell that output These 20 statesmen approximately
$4,000 per year. and they have merely scratched the
surface of the potential market At last the manufac
uer decides to take chance He lets 10 of the statesmen
60, and spends $4,000 newspaper advertising. His
volume of business is even bigger. Thus, instead of
$50000 it costs him only 1000 dispose of his product
and the public benefits. .--:.
When the Kellogg Toasted Corn Flake people came
out in the newspapers with their that in
the future, every package to be covered with WAN
TITE envelope, some economists said: "Phew1how
they increase the cost of their goods and not raise the
prce?" The answer is easyso big has their volume OF
business become result Of advertising according to
their satement that they have been able not only
to lower the price from 5c to 10c but also they have
been able to give larger package and top of that
furnish WAXTITE envelopes all boxes. That is how
advertising sometimes increases the purchasing power of
the average consumer dollar -. ~..-...-..- i.
The public benefits for two first the retail
merchant who handles this manufacturers product is
willing to sell it with less margin in for him. than he
would require of unadvertised article The reason
he is willing sacrifice part of his gross profits in this
way that he has to spend less effort in order to sell the
kind for which demand has been created through adver
Using in his home newspaper The other why
this change in the manufacturers sales plan benefits the
public is that the manufacturer has to be careful
He has to be that his goods up to high stand
ard because he knows that his advertised goods sub
iec to inspection by the ultimate purchaser,
than if he had published no claim for his article
Even further, it often happens that through de-
creased selling expense the manufacturer lower his
price if he wants to. And, rule, he does want to
lower his price lift his volume of business to the
highest possible point and thus the mum net
revenue from the sale of his output.
Mondays chapter will be: What are the two divis-
ions of Advertising"