Alma record. (Alma, Mich.) 1878-1928, 1922-05-25
TRUTH ABOUT
RETAIL PRICES
ROGER BABSON, STATISTICIAN,
POINTS OUT REASONS OF
HIGH COST OF LIVING.

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 | have been on my trip
these past three MONTHS" said Mr..
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
a reduction in retail prices to CORE
spOnd with the reduction in wholesale
prices. A part of this difference is
perfectly natural as movements in re-
tail prices must Of necessity lag from
six months TO a year behind changes
in wholesale prices. But even allow
ing for this natural lag, statistics in
dictate that the retailer has not yet
made the REIMBURSEMENT which has
been made by the wholesaler. This
is an established fact and it is useless
for retailers to claim otherwise.
Whether retailers are to blame for
rot making this REIMBURSEMENT is, how
ever, a debatable question. My inves-
LEGATIONS thus far lead me to believe
the retailer is not to blame, but is a
victim of certain economic changes
which have taken place during the
past few years.
"In the lumber regions Of the south
which have visited recently stand
ard hard pine at the mill increased
curing the war from 100 to 200 per-
cent, over pre-war levels. Today it
is back to normal. The lumber in
dustry, however, has had practically
namely, the price it pays for labor.
Three years ago when these mills
were paying SO to 81 a day per man,
now they are paying from 81 to $l.5O
q day and are getting much better
men. By being able to quickly cut
their operating costs so drastically it
has been a simple matter for them
to reduce the price of their product.
Moreover, their volume is such that
they are perfectly satisfied with a
profit at 50 per thousand feet.
"When this lumber reaches the city
the retailer demands a profit Of SIC
per thousand simply for peddling il
cut. OF course from an economic
point of view it seems absolutely UNI
just that the man who owns the for
est, cuts the timber, makes and de-
livers to your city the lumber should
get only So a thousand while the re-
taller in your town who simply takes
it from the railroad yards to youI
house gets so per thousand. Yes
this seems very unfair, yet examina-
tion shows that most mill owners
have become wealthy while only a
very few local lumber dealers have
ever made much money and the. per.
centage of failures among lumber
yards is abnormally great. In short
the retailer, under present economic
conditions, really needs this appar.
emily abnormal profit which he is get
ting. The truth is that retailing ha.
become so complicated that the retail
which he has little control.
"My thoughts" continued Mr.. Bah
son, ego back to boyhood days il
Gloucester, Massachusetts. There wa.
a butcher shop near my home wher,
we used to buy our meat. / can Sc,
it now with the hams, and bacor
hanging up on the wall, big block in
the center of the store behind which
was a fat healthy butcher, the pro
prietor of the establishment, and tn,
sole employee. When my fathel
wanted some beef he gave me tn,
money and sent me to the market t,
get it, The butcher gave me the Gu
my father desired, wrapped it in
brown paper and took it home, pay
ing cash for the same. The price o
good beef in those days was twent,
to thirty cents a pound. There, how
over, were no deliveries and TIL
butcher didn't spend anything on ic
in the winter time for remember tn
frost there used to be on those butch
en- store windows although the butch
er was healthy and happy man.
To-day the same store is used for
butcher shop but it is steam heate
and the proprietor buys nearly a
much ice in the winter as he does i
the summer. Moreover, the propri
etor does not cut any meat himself
Mornings he usually is found in tn
store, but afternoons he is usually ou
automobiling. He has a bookkeepe
who keeps. the accounts, big cas-
register, two clerks, and a man VIII
runs the delivery automobile. OWN
to possible breakdowns he has tw