The Richmond palladium and sun-telegram., 1921-10-18
FARMER MUST
HAVE SHARE IN
RETAIL PROFIT
Federal Experts Say Retail
Prices, Wages and Farmers
Earnings Are on Different
Levels.
SEEK FOR new BASIS
BY FREDERICK J. HAskIN

why, demands an editor out IN the
corn belt, docs the retailer charge
from 35 to 40 cents pound for pork
chops when hogs cost him only six OF
seven cents?"
He is one of a chorus singing diff
ferent words to the same tune.
man down in Oklahoma wants to
know why he cannot tote enough hides
across the street on his back to buy a
pair of shoes. A man in Georgia
wants to know why cotton enough 20
make a tent won't buy an undershirt
And a farmer in Maryland asks why
apples, such as he fed to his hogs be-
cause it would not pay him to haul
them to market, sell for five cents
each on the fruit stands.
All OF these questions have been
asked many times. They have also
been loudly answered with the asser-
tion that retail prices ore too high,
which is, of course, merely begging
the question. Sometimes it is added
that the retailer is a profiteer, which
is generally rot true, and certainly
sheds no light on the situation.
Question Complicated
When the editors query was laid
before certain marketing experts in
the government service it was learned
that the question is good deal more
complicated than those who blame the
retailer and let it go at that, ever i'm
agined.
The department of agriculture is
making a study of the retail prices of
farm products in all of the principal
American cities. 1t is going to find
out just why these prices are so in
ordinately high and why the farmer
gets such a small share of the large
price that the consumer pays.
The government men do not care to
be quoted, nor to make any extensive
comment, until this investigation has
been completed But in the mean
time they throw out few hints.
IN the first place, they say, don't
be too quick to blame the retailer.
Retail prices probably are too high.
but they are not as much too high
as you think The retailer has been
facing a dull market for long time
now. His great need is turn over his
stock. It is extremely probable that
he would reduce prices if he could
afford to do so, in order to stimulate
trade. In many cases, of course, he
has done so. The papers are full of
DdTBdlH sdle advertisements. L ct IHO
] average of retail prices remains high.
Cost Of Retailing High
This, say the experts, is partly be-
cause the cost of retailing, as a busi-
ness operation, is high. Out of the
So cents that you pay for pork chops
the retailer must pay not only the
price of the pork at Wholesale but
also the rent of his store, the cost of
~ II, L, 81. u
the wages Of the man who cut it and
sold it to you, the paper in which it
is wrapped, and the upkeep of the
vehicle in which it was delivered.
The experts do not seem to know
exactly what percentage of the cost
of those pork chops is represented by
each of these elements in its trans
fer, That probably is one of the
things their investigation will reveal
But they think that the price paid for
the pork is less than half of the total
cost of getting it from wholesaler to
consumer And all of these factors
in the operation have risen in cost
Rent, wages, ice, paper, gasoline-nC
one needs to be told that all of these
things are from 10 to 100 per cent
higher than they were in 1913.
Overhead Still High
Remember, too, that with many per
sons out of work and money tight
he retailer is doing smaller than nor
NAL business. But he still pays the
Same rent. and he probably has tC
maintain about the same staff. His
reduction in expenses, in a word. is
not in proportion to his reduction il
business. That means that the cos
of making each sale is higher thar
it would be if he were doing bis
!, husines If the butcher only sold on,
pound of pork chops in a day, HI
would have to get SO or SIS for it il
order to break even.
AS a matter of fact the profiteerin!
retailer is probably a rare bird jus
now 4 few of them are perhaps max
ing large profits by sticking to wal
time prices; but many of them ar
only hoping to make expenses unit
better times come along.
The difficulty, explains an expert
lies in the fact that retail prices
wages. and farmers earnings are a.
on different levels. In order that ou
clumsy industrial system may wor
at ALL they must be on about n
same level.
Farmers Felt Drop First
When prices began to drop, III
drop fell on the farmer first, with III
sold stocks of foodstuffs on hand, RI
buyers refused to give him a hig
price for what he raised. But he ha
TO sell So he took low price. Who'll,
salers and retailers refused to folio
suit The cost of their operations wa
high, chiefly because wages RENAME
high, and by cooperation and storag
both of which the farmer lacked, the
were able to keep up their prices I
great extent
But the farmers form about 40 pt
cent of the buying public. Havir
very little money, this large sectio
of the buying public bought very littl
Manufacturers of farm implements ir
mediately felt the pinch. Their sal,
= In many cases fell off more than hal
- Millions Affected.
Other manufacturing lines also fe
il. AS result factory employees wei
thrown out of work. Unemploymel
set in. 1t affected millions. So II
Continued on Page Two)