Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-07-10
CHAIN STORE ISSUE
AIRED IN INSTITUTE
Brookhart Delivers Attack
and Opposing Retailers
Defend System.
BY THOMAS r. HENRY.
stad CORRESPONDENT of The Star.

The chief denouncer was Senator
Smith w. Brookhart Of Iowa, who de-
clared the chain system was making
1t impossible for the small independent
merchant to stay in business. On the
other hand, 1t was held up as the pro-
tector Of the people against the high
cost of inefficient merchandising and
as the institution that IS putting that
old-time ogre, the middleman, out OF
business.
Sees Fight for Existence.
about IT per cent of the retail bust
ness In the United States" said Sena-
tor Brookhart, lis transacted by the
chain-store system. Upon this per-
centage of the total business the sys-
tenn has gathered in about 40 per cent
of the profits on all foodstuffs through
retail, about 40 per cent of all profits
on wearing apparel, so per cent of all
retail profits on drugs, rs per cent of
all retail profits on gasoline and about
80 per cent on all theaters and moving
pictures. These estimates do not in
clude the profits on chain banking,
diaries, farms. newspapers and other
effective forms of monopolieS. This,
If unchecked, will soon create mo-
nopoly of the retail business of the
United States. The chain store is a
phase of the great mOnopoliStic phe-
nomenon that is rapidly Transforming
the country into a financial autocracy."
Since 1920, Senator Brookhart said,
the chain-Store business has increased
about $40 per cent, amounting in 1927
to $4,000 100000. The retail mer-
chants are in a fight for their very
lives" he said They must join with
their customers for the control of cor
porations. transportation, excess profits,
credit and marketing.
Asks Independents Coop.
eve are the only civilized country in
the world that by law prohibits its
farmers, laborers, independent mer-
chants and manufacturers from organ
izing their own savings in a co-opera-
tive banking system with cooperative
reserve bank, all under their own con-
troll. All Of our cooperative organiza-
tons have been built up without the
support OF such cooperative credit
system, hence the vast numbers of their
failures"
Senator Brookhart proposed Nation
wide cooperative scheme in which the
independent merchants would take part
and which would reach into all sources
of supply, transportation and credit.
Alliance Head Hits Chains.
j. Frank Grimes of Chicago, president
of the Independent Grocers' Alliance of
America, advocated that the chain stores
pass their business back to the indi-
vidualS unless the chain system finds
way to fulfill 100 per cent of the obi
cations and responsibilities to the COM
munity now shouldered by the indie
pendent merchant"
Mr.. Grimes commended that farmer
and manufacturer, as well as indepsnd-
ent merchant, have been affected by the
ri ~ y. i
prices paid farmers and manufacturers
he stated, and have begun the absorp-
ton Of factories, thus depriving the
manufacturer Of profits and his en-
ployes of wages"
Defends Chain Stores.
Protest against discriminatory Iegisla-
ton against the chain store was made
by Clark McKercher, general counsel
for the National Chain Store Associa-
ton, who stressed particularly recent
indiana law authorizing progressively
higher license fees for stores according
to the number under one management.
This, he indicated, might be an opening
wedge for the enemies of the chain
store system. During the past year, he
said, more than 100 anti-chain store
measures have been introduced in
American legislatures. but only two
have passed. One such bill proposed
tax of 100000 on any corporation
operating more than five stores in the
State.
The chains, he said, "have grown
great and prosperous only in the meas
ure with which they have served the
public. That they have revolutionized
consumer distribution, and at a price
relatively less than was enjoyed before
their advent, cannot be denied. Families
Of
the chain stores freely use their
facilities. One whose public utterances
in dozen States pursue them with
everything from profanity to prayer
equipped his automobiles and trucks
with tires from chain store.
Holds Growth Inevitable.
''Over and over again the fetish of
taking money out of the State has
been exploded. Rents, taxes, salaries
and purchases of State-owned apd
grown commodities make a local in
Stitution of nearly every chain group.
A great many have fixed appropria-
tons for local charities and improve
ments. That their lawfully and moral
ly acquired advantages are coming to
be recognized as more to be fostered
and protected than harassed and de-
stroyed is manifest in the editorial COM
4l1cIltS III GIle PUBIC press.
AS many independent stores failed
before the coming of the chain stores
as now" he continued. There can't
be monopoly Of food. It is an evolu-
ton OF distribution. The chains have
forced on the independent stores better
habits OF merchandising. Gathering
around the stove In the store to dis
cuss politics isn't done any more"
That the average man has a better
opportunity In the employ of one of the
big chains than as an independent mer-
chant was asserted by Paul Mooney,
personnel manager OF one of the large
Midwestern chains. The popular idea
that the big chain systems seek robots"
without initiative or imagination to run
their branches is absurd Mr.. Mooney
said, since the success of any one store
depends very largely on the capability
Of the manager.
Terms New Order" Better.
The chain store, partially eliminating
the jobber and passing goods directly
from the manufacturer to the consumer,
Is an essential development of new IA
cilitieS of communication and trans
portation, said w. w. Hughes, assistant
to the president of the j. c. Penney Co.
ut cannot be said" he declared,
that the present system of merchan-
dizirg, with direct contact between the
manufacturer and the retailer, has not
been without certain great benefits
which, in the analysis of our economic
life as whole, more than outweigh
the gradual disappearance of the older
order. The very force of the spirit
of competition which is being developed
by the speeding up Of retail purchases
is the great factor of safety so far
as the retail customer is concerned.
1t is the thing that is assuring the
woman in Iowa, or Nebraska, or Ala
bama that she can today secure for
herself the style, the quality and the