The Ely miner. [volume] (Ely, Minn.) 1895-1986, 1929-09-27

the branch department store In his
own city or town or but a few miles
away.
One-fifth of the retail trade OF the
United States is now in the hands OF
chain stores But this tremendous IN
road into the country's retail trade
now represents only SIS lines OF goods
out of a total of over 10000 trade
fields. The inevitable result OF the
growth of this distribution system Is
too obvious for comment.
There are now in this country 1000
chain store systems operating 100000
stores, and doing an annual volume OF
business of approximately $5,OOO,OOO,-
600. Already the wholesaler in gro
ceries and kindred lines seems doomed
Economic experts give the wholesale
grocers another five years to be en-
tirely out of existence, and the doom
of the wholesaler in many lines OF
convenience goods is obvious. A sim
liar situation confronting the local re-
taller is practically a mathematical
sequence.
1t was once the common belief that
the sitting of business competition
by combination was made impossible
by the Sherman Antitrust Act, but
seemingly this efficacious statute has
passed into antiquity. If anything,
governmental encouragement is ap-
parently being given to industrial,
commercial and financial consolida-
ton, without thought of the ultimate
result.
Legitimate competition is the life
blood of American business, but a
form of competition that embodies
consolidation of production, financing,
buying and distribution, and masses
the horsepower of such gigantic
forces against local retail agencies to
the extent of controlling one-fifth OF
the country's retail trade in space
of a few years, means nothing short
of ultimate destruction OF the local
merchants business. If we are not
to have ultimately monopoiStic
business structure for the entire coun-
try, it is time for the local merchant
to set about the protection OF his busl-
ness through timely cooperative ef-
forts. In such movement the local
banks should lend their every effort
to preserve the economic Integrity OF
the local business community. They
are it's backbone, the local business
community is the edifice of their
success as banks And bear in mind
that the local chain store sends the
money it takes in to the large indus
trial center from which 1t eminates
and does not retain it in the local
banks or buy in the local market. 1t
is simply unit in the commercial
colossus to which it belongs sapping
the life from local independent bust
ness and draining the money from the
community to which that money eco
nomically belongs.
AS an instrument of business COM
petition the chain store system is a
two-edged axe welded with terrific
economic force by reason of the ire
mendous horsepower behind it. With
from 40 to 80 stock turn-overs per
year with an average net of 2 per cent
per Glll-OtCl, SdlAOnu w AoSooAy
output buying capacity, favorable
national labor turnover, the chain
store system of distribution is usually
backed by realty company or syndi-
cate which develops an additional net
profit of 6 per cent on the capital in
vested through the holding of the
chain store leases.
There is but one way for the local
merchant to protect himself. Effec-
tive organization and intelligent CO.
operation with his fellow merchants
must be accomplished. BY proper CO.
operative organization local retailers
can create buying power and ma
chinery to even under-buy the present
chain store systems, for the retailers
now have four-fifths of the country
retail trade to hurl into the balance
against the chains one-fifth. Mer-
chandising methods can be so far i'm
proved that the display and sale of
goods will individualize the retailers
store and out-do the conventional
selling methods of the chain store.
Local publicity can be used to intelli-
gently educate the people of the COM
munity that not alone has the local
merchant a better sales value in his
goods, but that their own best inter-
ests in the dollars-and-c worth of
their community are better served by
the local retailer.