Evening star., 1942-10-11
Small Retailer Faces
Worst Squeeze in
War Conversion
Big Independent Stores
And Chains to Fare
Better Than Average
BY FRANK Mac MILLEN,

BY FRANK Mac MILLEN,
Wide World Business Writer.
NEW YORK, Oct. 1.-THE coun-
try's 100000 retail stores are the
heart of the small business problem
because-unlike many manufac-
turers-they can't convert to war
production and won't be able to get
enough goods to supply their GUS
toners. ~
The little fellow, the man who
runs a store with a total intake
of $4,000 a year or less, will feel
the squeeze worst, Washington sur
veys show.
Bigger independent merchants
promise in many cases to fare better
by far than the average OF the coun-
try.
Chain stores, whose gross busi-
ness run high, can be expected to
get along much better by-and-large,
not only because they have financial
maneuvering room, but also because
the chains have made a speciality of
the relatively stable food line.
Buried in War News.
Partly buried in the rush of war
news and more spectacular talk
about idle manufacturing plants has
been a comprehensive report by the
Department of Commerce. made un-
der the direction of Charles C.
Fichtner, chief of the division of
regional economy, to the Senate
Special Committee to study the
problems of small business enter
prises.
Fichtner's foreword said:
while many manufacturers have
converted to war production. few
retailers can convert to war manu-
featuring.
"As civilian goods are curtailed
and inventories run out retailers
face a very serious situation.
Not only will goods be increas-
ingly scarce, but most of these COM
modities cannot be sold above Ger
tain ceilings.
Acute labor shortages, moreover,
add to the problems of retailers as
more men are drawn into the armed
forces and into war industries"
Frankly characterizing the tone of
the report "jeremiad," he never
theless adds:
Most retail establishments
serve basic civilian needs and have
an indispensable place in the war
economy.
Many of the less essential retail
stores have the opportunity to
survive if adjustments are promptly
made
Sharp Cuts Predicted.
But here are some of the pre-
dictions and ideas developed by the
departments study:
Sales of all kinds of retail stores
in the first half of 1943 are ex-
pected to drop II per cent below
the same half of this year: from
$26, 500, 900 900 to s22 900 900, 900. For
point of reference, the whole
years sales this year are estimated
at $1,000, 100000, compared with
$42 900 100000 in 1899
But the impact of this sales de-
cline will be very uneven on various
kinds of business. -.
Using changes between the calen-
dar year 1889 and the IL months
ended June 30 next, the department
estimates the business of new and
used car dealers will be down more
than 80 per cent; household appli-
ances and radios roughly IS per
cent: heating, plumbing, paint and
electrical stores, so: filling stations
40; lumber and building materials,
about the same; farm implements
more than 35; hardware stores,
about 25, and shoe, clothing, de-
partment and variety stores, all
about the 10 to 20 per cent range.
Some Concerns to Gain.
At the same time Improvement of
around IS to 40 per cent is predicted,
over the same periods, for package
liquor stores, eating places and
drinking places; of nearly 20 per
cent for various types of food stores,
and of about 10 per cent for feed
and farmers supply stores.
All these estimates are country
wide averages, take no account of
varying local conditions.
The lines of business in which the
departments study predict a decline
as the war progresses contain a
heavy concentration of small mer-
chants, mostly non-chains.
About 350,000 stores with sales of
$4,000 year or less, fifth of all
independent retail outlets, are in
cluded in the lines for which a de-
clining trend is predicted in coming
months. If the sales limit is lifted
to $4,000 year. then the number
affected by expected declining" sales
curves nearly a half million.
In the up-to-$20O00 class are IS
per cent of the filling stations, rs
per cent of the heating, plumbing
paint and electrical outlets; IS per
cent of the household supply and
radio stores. so per cent of the farm
implement retailers and Is per cent
of the lumber and building materials
people.
Seen at Disadvantage.
The report says:
THE small retailer often is at a
disadvantage in periods when sup
plies are tight, since he may not
have sufficient credit facilities OF
may not be able to cut costs in the
same proportions as the large re-
taller.
Furthermore, in the last veal
small firms have not increased theil
inventories to the same extent as the
large ones. so that they are less able
to maintain sales by drawing upor
stocks.
For these reasons many small
retailers in declining lines of busi.
ness will experience sharper decline!
in sales than the larger ones in the
same lines of business.
Even in those kinds of business
that are expected to maintain or in.
crease their sales in the next l.