Great Falls tribune. [volume] (Great Falls, Mont.) 1921-current, 1922-05-14

wellesley Hills, May lS.-DlscuSSlng
the general trend of the business re-
vival, Roger W. Babson, the statis-
tician, has pointed out one of the
factors that is holding up prices and
living costs.
Wherever 1 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 ne gain saying the fact
that retail prices are out of line with
wholesale prices. There has not been
a reduction in retail prices to cores
pond 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 allowing
for this natural lag, statistics indicate
that the retailer has not yet made the
readjustment 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 not making this readjust-
ment is, however, a debatable question.
My Investigations 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 l visited recently, standard hard
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, how
ever, has had practically only one main
factor to contend with, namely, the
price it pays for labor. Three years
ago when these mills were paying So
to 81 a day a man, now they are paying
from 81 to $3.50 a day and are get
ting 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 81 a thousand feet.
When this lumber reaches the city
the retailer demands a profit of $40 a
thousand simply for ~peddling it out.
OF course, from al economic point
of view it seems absolutely unjust that
the mar who owns the forest, cuts
the timber, makes and delivers to your
city the lumber should get only s. a
thousand while the retailer in your
town who simply takes it from the
railroad yards to your house gets $40
per thousand. Yes, this seems very
unfair. yet examination shows that
most mill owners have become wealthy
while only a very few local lumber
dealers have ever made much money and
the percentage of failures among lum-
Der yards is abnormally great. In
short, the retailer, under present
economic conditions. really needs this
apparently abnormal profit which he is
getting. The truth is that retailing has
become so complicated that the retailer
is the victim of circumstances oyer
which he has little control.
My thoughts continued Mr.. Bah
son, go back to boyhood days in
gloucester, Massachusetts. There was
a butcher shop near my home where
we used to buy our meat. | can see it
now with the hams and bacon hang
ing up on the wall, a big block in the
center of the store behind which was
a rat, healthy butcher, the proprietor
OF the establishment, and the sole en-
ploye. When my father wanted some
beer ne gave me the money and sent
me to the market to get it. The butcher
gave me the cut my father desired,
wrappd it in a brown paper and | took
1t home. paying cash for the same. The
price of good beef in those days was
~ to ~ cents a pound. There. how
ever. We're no deliveries and the
butcher didn't spend anything on ice
in the winter time for | remember the
frost there used to be on those butcher
store windows although the butcher
was a healthy and happy man.
Today, the same store is used for
q hnfrhpr chm but e Sc 49, $3.50.
and the proprietor buys nearly as much
Ice in the winter as he does in the
summer. Moreover. the proprieror
does not cut any meat himself. Morn
ings be usually is found in the store.
but afternoons he is usually out auto
MODELLING. He has a bookkeeper who
keeps the accounts, a big cash register,
clerks, and a man who runs the
delivery automobile. Owing to pos
sible ~breakdowns, he has two automo-
biles. Not only is everything run on
a much more expensive basis. but the
clerks don do more than half a days
WORK Ihey see the proprietor loafing
and they loaf themselves. None of
them have any interest in the business
and each one is trying to get by with as
little work as possible.
The fundamental question is wheth-
er or not this store is selling any moro
pounds of beef and provisions than il
dld 20 years go. I know the rent
has doubled and other expenses have
trlpled and ~quadrupled, but / seriously
doubt if this store is selling any more
goods. Gloucester hasn't as much pop
ulation as 1t had 20 years ago. and
there are more butcher shops. 1t is
probably true that people are eating
more meat per capita now than in
those days, but l am very sure that
the output of this shop is no greater
it was 20 years ago. Today, how
ever. when or of the ~neighbors wants
she no longer sends her boy TO
get it (he is probably playing football
n practicing for a high school minstrel
show or perhaps he is at the movies).
To-day. the mother telephones to the
shop, the b~ookkeeper enters
he order on an elaborate filing sys-
EN-. this in turn is given to one of
he clerks. who cuts the meat. The
neat is then wrapped in two or three
pieces of paper, put in a special basket
md delivered by an auto truck, cost
ng $1,000 to $4,000. i,
"As a result, people today, under
hese conditions, must pay double or
ripple for their meat, compared with