The circle banner. [volume] (Circle, Mont.) 1914-1939, 1919-12-05
OFFICIAL PAPER INCOME COUNTY
LET Us BE FAIR
(From the Harlowton Press.)

The Harlowton Press is opposed t
Order No. 4" of the Montana Trad
Commission. We are opposed to
because it defeats its own purpose. /
will RAILS instead of LOWER the cos
of living. 1t will injur honest and fair
dealing small town merchants. 1t will
every small town. "Order No. 4" is {
half-baked idea that might work ou
if applied in national way; if it ap
piled to the manufacturer and whole
saler, as well as to the retailer. But
it cannot solve the high cost of liv
ing by being applied to Montana whole
sale and retail merchants alone.
"Order No. A." recently issued by
the Montana Trade Commission, in
brief, stipulates that every merchant
in the state of Montana shall on De-
cember LIST, 1919, mark every COM
modify he has for sale, with two prices
The INVOICE and the SELLING
price.
AT first glance, the average reader
will say that this is the proper stunt.
You will say that if the merchant has
to do this, he won't be able to cheat
the public. His margin of profit will
be so plain that he won't dare to pro-
fiteer
Right here is the meat in the coca
nut: The difference between the in
voice price and the selling price DOES
NOT REPRESENT THE MER-
CHANTS MARGIN OF PROFIT.
Instead, it represents his COST OF
DOING BUSINESS (his "overhead")
and HIS PROFITS.
If the invoice price of an article is
$500 and you feel he is entitled to
20 per cent profit, you'd say he should
sell that article for S2.40. But not so.
1t costs the average merchant 25 per
cent to do business. His rent labor,
: insurance, freight charges, ETC., a.
mounts to 25 per cent of his volume of
business. So this article actually
costs the merchant $3.50 In order for
him to do buFness profitably, he must
have profit on the article after it's
invoice cost and his overhead" have
been added. So the merchant should
receive $3.50 for the article which
Was invoiced to him at $500. But, if
voiced, $500; Selling Price, $780,"
you'd say the merchant was making
nearly fifty per cent profit, and was
'profiteering," when in fact he is mere
ly making enough TO keep his head
above water.
The above illustration is rather
crude, in way, for on many things
that merchant handles, the expenses
of freight is much bigger item than
rs per cent of the invoice price. Take
salt for an example. A sack costs the
merchant, at the present time, so
CENTS, AND THE FREIGHT ON
THAT SACK is SIS CENTS. When the
merchant sells you a sack of salt for
$1.5O, he is not making SINGLE
PENNY, for it costs him SLIPS to get
the sack into his store, and it costs
him 25 cents more to sell you the
sack, for he had to keep clerks on
hand to wait on you, and had to pro
tect it by insurance while it was in
his place, and pay rent for the place
in which he does business.
Granting that the Trade Commits
sion would permit merchants to put
the actual COST PRICE Gnvoice price
plus overhead) instead of the IN
VOICE PRICE on the tag with the
SELLING PRICE,-even then, the
high cost Of living would not be re-
duced, for the labor entailed in mark
ing every article in such fashion
would add hundreds of dollars to every
merchants cost of doing business.
Somebody would have to pay for this
added cost, and the CONSUMER is
the man who would be hit.
Confidence in our fellow townsmen
is the first basis upon which trade
operates. The Montana Trade Com
mission says, in effect all Montana
merchants ARE thieves. They have
published this statement not only
throughout Montana, but throughout
the whole United States.
Out in Iowa, there are people who
say We'll, | wouldn't 60 to Montana
to do business. The merchants out
there are SO crooked that the state
makes them mark everything they sell
with the invoice price as well as the
selling price"
Right here in Montana, the mer-
chant who has worked hard to keep
his head shove water, who has borrow