Every evening, Wilmington daily commercial., 1921-07-05

now. thus giving the manufactures
a lower averge cost upon his books.
Equal quantities OF materials bought
last year at IS cents make an average
cost for materials of 1Sia cents. In
creased volume will take care of the
difference, and low price is the key
stone of volume. For S5 years, ever
since 1 was Ia years old, l have been
IN close touch with various classes
| of the buying public. 1 feel that /
| know the public. a knowledge which
| is the university education of busi-
ness. For three years l peddled writ
| ing paper from door 10 door in small
towns. in rural districts and in cities.
I have been in the retail business.
y ve worked up through the whole
! sale business from being a helper,
without pay. working for board only,
70 own good sized jobhing establish
ment. Since 1910 have been a man
ufacturer.
Why Does Business Fall OF.
During all of my experience, / have
as yet failed 10 find time when
people would not buy If offered some
thing they wanted at a satisfactory
price. / have discovered that year "A
and year out there is certain de-
mand for necessities in this country
which generally averages about the
same. One year may be boom year;
the next year may be slack; but the
two average up 70 normal, even con-
sumption that increases with the
growth in population and the inn
proved circumstances Of the people.
True. i said necessities. But every
business contributes its bit toward
the making of necessities, or the sale
or distribution of them, excepting pos
sibly those which are engaged ex-
ciusively in the handling of luxuries,
and even they profit indirectly. Start
with raw materials in their crudest
form and follow them up through the
various processes until they emerge
as finished articles. or as tools and
machinery for the preparation of other
finished articles. and you find only
things which the people need Though
a man be engaged in making ma
chinery, or contractors supplies. or
locomotives, his prosperity depends
upon the demand for necessities orig
mating in the buying public, and
taller 10 wholesaler to finished goods
manufacturer. TO machine maker 10
steel mills and 50 on. When neces-
sites move freely. everything must
move with them. When prices and
qualify suit the public, providing that
the people have money with which
10 buy, necessities are freely pur-
chased. Bank statements in all parts
Of the country and our own observa-
tions told US that the people had
money. 1t was reasonable to con-
clude. therefore, that price was the
basic cause hack of the depression.
Perhaps there is nothing new in any
Of this. IT has all been said before.
Be that as II may. the principle OF
making actual prices and the publlc's
idea Of prices agree has by no means
beer generally observed in necess ties.
The public's refusal 10 buy necessi-
ties at prices which have been quoted
has been the rope that has tied UP
the whole business machine.
Personally do not think we can
lay too strong an emphasis on the
importance of price at this time
But we get back to our situation
We were making a necessity. under
wear. In veiw Of what we knew OF
the effect of price upon the public,
there was but one course open TO US
If we would sell our goods-name a
price which would stimulate and in
duce the public TO buy
The decision was not arrived at all
at once. Concievably it might pro-
ftably have been arrived at sooner
than il was. More than a year ago we
detected the first sign of the approach
ing storm. We were practically help
less. Ne more than others could we.
predict what was ahead and, like
others, we hesitated, waiting to see
what would happen and what course
business generally would take. Ma
terials were selling at peak prices.
Yet all we could do was to pay those
prices, for we needed the materials to-
keep our plants in operation and IT
wasn't good policy then TO delay in
getting them.
The policy of continuous operation,
all hands at fun time, had been de-
cided upon, because we had confidence
in the average normal buying of the
public. If prices were to come down,
as it seemed certain they would, and
ii costs were TO remain up in many
instances-and this seemed certain
also--the best way to adjust the two
would be by increasing volume. IT
took no statistician to see that by
curtailing production we would be de-
creasing volume. and thus destroying
the one opportunity open to make
costs and prices agree. This was fig
uring a long way ahead, but it was
the only logical way to figure in view
of our confidence in the rule of aver
age normal demand. When June Il
came, the day set for naming our
prices. we refused to name them, so
uncertain was the immediate future.
BY July s something had to be done,
SO we took a grip on our courage and
announced price list based on man.
ufacturing costs. A few orders re-
suited, but so few and so hedged
around by conditions that we refused
TO consider them as orders. At this
time in previous years we had been
booked up to capacity. Now, 10 all
practical purposes, we had no orders
Conditions entered into our situation
with which we were unfamiliar, and
which contributed to our hesitancy.
A year previous we had launched into