Every evening, Wilmington daily commercial., 1922-05-15
.BABSON TELLS OF
BUSINESS REVIVAL
Expert Shows Why the Retail
S Prices Are Out Of Line With
Wholesale Prices.

Wellesley Hills, May 15.-Discussing
the general trend of the business revival,
Roger w. Babson, the statistician, today
pointed out one Of the factors that is
holding up prices and living costs.
"Wherever l have been on my trip
these past three MONTHS said MIR.
Babson, complaints have come from
all sources of the high retail prices. Now,
there is no gainsaying the fact that retail
prices are out Of line with wholesale
prices. There has not been q reduction
in retail prices to correspond with the
reduction in wholesale prizes. A part of
this difference is perfectly natural as
movements in retail prices must OF
necessity lag from six months TO year
behind changes in wholesale prices. But
even allowing for this natural lag,statis-
tics indicate that the retailer has not
vet made the rcadjustment which mas
been made by the wholesaler. This is an
established fact and it is useless Tor re-
tailers to claim otherwise. Whether re-
tailcrs are to blame for not making this
rcadiustment is, however, debataplc
question. My Investigations thus lar
lead me to believe the retailer IL not 70
blame, but is victim OF certain eco
nomic changes which have taken place
during the past few years. =,
"In the lumber regions OF the south;
which | visited recently, standard haro
pine at the mill increased during the
war from 100 to 200 per cent, over pre-
war levels. Today it is back TO normal
The lumber industry, however, has hnc
practically only one main factor t'
contend with, namely, the price it pays
for labor. Three years ago when thes'
mills we're paying SO to s4 a day PEI
man, now they are paying from ii e
$3.50 day and are getting mucf
better men. BY being able to quickly
cut their operating costs 40 drasticall,
it has been a simple matter for them u
reduce the price Of their product: More
over, their volume is such that they are
perfectly satisfied with profit at " Pc
thousand feet. :.
"When this lumber reaches the cit,
the retailer demands profit OF $40 PIE
thousand simply for peddling it out 0
course from an economic point OF viev
it seems absolutely unjust that the MAJ
who owns the forest, cuts the tlmbe
makes and delivers TO your city tn
lumber should get only 81 thusan
while the retailer in your town VIII
simply takes it from the railroad yard
to your house gets $40 per thousand
Yes. this seems very unfair, yet exsmina
tion shows that most mill owners hav
become wealthy while only a very fe,
local lumber dealers have ever mad
much money and the percentage G
failures among lumber yards is abno'
maIly great In short the RETAILER
under present economic condition.
really needs this apparently abnorma
, profit which he is getting. The trut
il that retailing has become % CON
plicated that tho retailer is tho victir
of circumstances over which he has littl
control.
"My thoughts," continued Mr.. Bal
son. go back TO boyhood days in Clio,
cester, Massachusetts,. There was
butcher shop near my homo where "
} used to buy our meat. can see 1t no
/ with the hams, and bacon hanging up 9
the wall, a big block in the center of u
store behind which was q fat heath
butcher, the proprietor OF the establish
ment, Apd the sole employee. When N