The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-08-07

| Nobieo VI control IN the nandB OF pack
ers as In the heavier grades, yet some
OF these same packers are very i'm
I portant factors In the country hide trade.
Iaking into account the extent to which
| tnese nve large meat packers control the
domestic hides. the extent to which they
control the hides that are available for
| import and the extent to which some Of
| them are engaged in the country hide
business. and taking also into account
the extent to which they are engaged
In the tanning business. they seem to be
In position largely to control the hide
market
The system of handling and market
| Ing country hides Is not satisfactory
The farmer, and often the small butcher,
usually sell their hides without grading.
| AS consequence OF this method of pur-
CHASING hides from the primary owner
II Is often the case that no distinction
is made between those hides that are
well taken or and we'll cured and. those
| that are not.
Tanning Prices Increase,
During the four years 1914 to 1917
| the cost Of producing sole leather in
| creased from to more than 20 cents
per pound of leather produced. About
80 per cent. OF the increase was due to
| the increased cost of hides. The in
| crease In cost other than for materials,
| including overhead expenses, during four
years ranged from about ~ cents to
cents per pound of leather produced.
For upper leather the increase in the
conversion cost between 1914 and 1917
was in some cases as much as 100 per
1 cent, though the total cost of producing
| this class of leather. including the cost
| OF the hides, was approximately only
| 20 per cent The cost of producing kip
| upper leather, including the cost of the
hides, Increased during the four years
| ABOUT 10 per cent, while the cost of
| producing calf leather increased a little
| more.
The earnings on investment in the
| tanning business were very much greater
| In 1915 and 1917 than they were in
| 1914 and 1915 The poorest results were
In 1914. OF flfty-three representative
companies tYenty-four earned less than
10 per cent. in 1914, and eleven had
| earnings OF over 30 per cent, while none
earned as much as 40 per cent. In
| 1917 only two of the fifty-three compa-
| MES earned less than 10 per cent.
thirty-two earned over 20 per cent and
nine earned over 40 per cent.
| There was a great increase in the
cost OF producing shoes between 1914 and
1917, the principal increase being in the
| cost of leather. Between 1914 and 1917
the cost Of leather increased from 40
( to 100 per cent. In a majority of shoes
the increase was over so per cent The
cost of materials other than leather such
| as Innings, trimmings, cartons and pack
| ing cases, increased at approximately
| the same rate as leather. Labor and
! general expense did not increase at so
J great a rate as either leather or other
| materials.
There was but little difference In the
| rate of increase in the various elements
| of cost of shoes except for misses shoes.
/ which had a greater increase in leather
cost than any other class, and children's
| and infants shoes. which had a greater
| increase in cost for materials other than
leather. II should be noted in this con-
nection that leather constituted from so
| to 20 per cent of the total cost of all
classes OF shoes in 1914, except infants,
and by 1917 this percentage had in
creased to about so to 75 per cent.
Manufacturers Demand More.
-"The manufacturers selling prices Of
| shoes increased at a somewhat greater
rate than costs. In 1916 costs in many
instances were less than 1917, but re-
auctions in selling prices occurred in
| only about half OF the shoes showing
| reduced costs.
The rate of return on investment was
much greater in 1916 and 1917 than in
| 1914 and 1915. Out Of 256 companies
| where comparisons could be made for
these years 90 had losses in 1914. BY
| 1916 earnings had increased until there
were only companies with losses, and
| in 1917 there were 8. There were 102
companies out of 236 that had earnings
| OF 10 per cent. or more in 1914, while in
| 1917 there were 169 companies in this
class. More than one-third of the COM
panies here considered earned % per
! cent or more in 1917. while only about
one-sixth earned this much in 1914. OF
| 236 companies 104 earned 20 per cent
! or more in 1916.
THE gross profits of wholesale shoe
merchants generally ranged above 20 per
cent of the cost and they were some
what greater in 1918 than in previous
years.
There was a heavy increase in the
price Of shoes to consumers between the
years 1914 and 1918. The retailers gross
profit is around so per cent-sometimes
more and occasionally less. In 1914. the
| retail merchants rate of profit was
somewhat lower than Il was in 1918.
The absolute amount of profit per pair
of shoes was very much greater IN 1918
than in 1914. A good work shoe for
men that cost the dealer s1.75 in 1914
and retailed for $3.50 cost him $2.75
| In 1913 and retailed for $500.
I'm this instance. the retailer took a
margin of rs cents in 1914, or AZ per
cent. and In 1918 margin Of Sl25, or
As per cent. In a group OF shoes that
cost the retailer from $500 to $3.50 in
1914 a large proportion of them re-
tailed for $3.50 with a percentage of
gross profits ranging from 40 to 81 per
cent. The same shoes in 1918 cost the
retailer from $3.05 to $4.45 per pair and
retailed at from about $500 to as high
as $500 per pair. with the percentage
of profit ranging from 80 to 60 per cent
In 1914 the retailers absolute gross
profit for this group averaged a little
more than 800 per pair, while in 1918
1t averaged more than $3.50 per pair
Costs Remain Same.
1.-THE absolute amount of money neces-
sary to conduct business in 1917 and
1918 was greater than In 1914. but the
relative cost of doing business prac-
tically did not change. The percentage
of total sales of dealers that was ex-
pended for the conduct of business was
approximately the same in 1917 and 1918
as il was in 1914. The volume of bust
ness of more than 90 wholesalers in
creased 80 per cent In four years, while
their actual expenses in dollars and
cents increased only "a per cent
THE actual expense of SO retailers
handling a general line of good shoes
was 26 per cent OF their sales In 1914
and the expense OF 81 dealers in 1917