The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1916-03-05

membered, Mr.. O'Donneu won the decision IN me
sanatogen case befors the United States supreme
Curt He is lighting other firms In court now.
His frank statement in the following artleie Nh a.
least to show Manufacturers the eahors OF tne
opposition to price maintenanoe les1sAhon.l
ITO readers who know anything OF
his business in Washington, 1t may come
as something OF a surprise to hnd James
O'Donneu taking issue with the business
methods Of the drug chains because the
popular impression is that Mr.. ODonnell
is dyed-in-the-wool chain OPERATOR
according to a writer in Printers Ink.
AS a matter OF fact he has MS own
chain Of three large retail drug stores
in the national capital, and 1t might be
termed a chain within chain since the
O'DonneIl establishments are Rexah
stores" and have certain amnauoh
with United Drug interests
Yet, Mr.. ODonnen is not a believer
IN the big chain; says that he would
be Just as well satisfied II he mad one
store instead Of three; and persists IN
declaring that his viewpoint is that Of the
large independent retailer. All Of which,
no less than his price-cutting propen-
stiles, may render of interest to ad-
vertisers in general the viewpoint and
policies Of this militant price-cutter who
Is now at daggers' points in the courts
with the Beech Nut company and the
makers Of Big Ben clocks, even as he
Gillette razor people and a number OF
others.
Not Looking for n eight"
The quarrel Of Druggist O'DonnelI with
the manufacturers is almost solely one
of wholesale price concessions. It is not
meant to insinuate that the o'Donnell
price-cutting is done solely in retalia-
ton for alleged Observation-Disclosures. His
use Of cut-rate leaders Is resorted to
frankly and regularly in order to slim
ulate sales but his contention Is that the
wishes of the manufacturer Who does
not wish to have his prices cut will be
respected If that manufacturer Is abso-
luteIy square with the retailers. In proof
of this he points to his own relations
with the Colgate concern. which he terms
the finest firm in the United States to
do business with. O'Donnell sells about
5000 worth of Colgate products per year,
but for all that he claims that they have
never asked him to maintain their fixed
prices, and he has made no promises to
do so. He has never made cut on Col
gate. simply because he has absolute
confidence that he is getting as favor
able terms as anybody else
1T is not that 1 object TO quantity
discounts" said Mr.. O'Donnen; on the
contrary. I believe in them. Nor do l
care a rap at what figure a manufacturer
places the order limit to entitle the pur-
chaser to the best quantity discount II
I cannot make a large enough purchase
to entitle me to such discount will never
complain, but what I do object to is the
manufacturer secretly or openly making
concessions to chains of stores. I am do
ing today. in my principal store, larger
business than is transacted by any other
store in the United States handling
straight line of drugstore goods. I be-
kkaf aARr
a larger turnover, but they handle glass
ware, crockery and other goods not en-
titled to place in a drug stock.
Pays Bills in Ten Days.
Similarly, I pay all bills within ten
days, which fact as well as volume of
purchases entities me, believe, to the
most favorable terms and yet I know
that it is or has been the custom Of the
proprietors Of certain chains OF stores
to demand from manufacturers all sorts
OF credit concessions, such as long time,
etc.
1T has been interesting to me TO note
recently a marked tendency on the part
OF manufacturers to lower the limit Of
requirements for quantity discounts. To-
day, there is scarcely a firm in our line
that requires a purchase of more than
a hve-gross lot to entitle the purchaser
to the best discount, and many concerns
have placed the limit at one gross. To
show the trend, I may mention that
with the opening of 1915 the requirement
on Listerine purchases was lowered from
500 to $50
ANY reader with half an eye can see
where the O'Donnell argument leads
to the placing Of the big retailer on the
same plane as the jobber in the eyes
Of the manufacturer. I sell more goods
than any wholesaler in my territory
says this Washington druggist, why
should I not have as favorable prices
from the manufacturer?
q" Manufacturers are coming to 1t rap
idly. Indeed, for all the denials and pro-
testations that are made on the subject
I know of only two firms in the United
States, Eli Lilly and Sharp & Dome, that
will not make as favorable terms to
the large retailer as they will to any
jObber. If the manufacturer will not
make the concession to the large retailer
the Jobber himself will. Any jobber will
today divide profits with me. II he gets
a discount Of ten per cent he gives me
five. II he gets fifteen per cent he gives
me ten. He does business with
me at loss, inasmuch as it costs the
average jObber ten to twelve per cent
to do business, and one wholesale house
with which I am familiar, and which 1
expect will go into bankruptcy within
the next month, has, for a long time past
expended fourteen per cent In doing
business.
Why does the jobber willingly split