Milford chronicle., 1961-02-17
IA CENTS our OF s1O

IA CENTS OUT OF SO
When you buy $40 worth of groceries,
how much of that stays with the store in the
form of profit? It's safe bet that great
majority of shoppers couldn't answer that
question with any degree of accuracy. They
would probably put the profit factor at
much higher proportion than it actually is.
The National Association of Food Chains
and the Harvard Business School Division
of Research have issued their fifth annual
survey of margins, expenses and profits in
the food chain industry. In 1859, net pro-
fits worked out to about Ia per cent of the
sales dollar-which means it came to IA
cents on a typical $40 bag of groceries.
There was nothing unusual about this-the
profit was practically the same in 1858, 1.3S
per cent.
Over the years, profit margins have held
remarkably stable. in the general neighbor-
hood of q cent-and-a-haf on the dollar Ex-
penses, by way of contrast, have shown sub
stantial increases, with payroll costs leading
the way. followed by advertising and pro-
motion expense, and real estate costs.
Summing up, the profit on food sales is
sc small percentagewise, that it would take
an exceedingly canny shopper TO notice the
difference if there were no profit at all.
Pretty much the same thing is true in other
basic retail lines - profits commonly run
around three cents on the sales dollar That
is the principle on which mass distribution
rests-very small unit profits and up to an
adequate total profit because of big volume.
5000
INGENUITY PAYS OFF
It's easy for the pessimist to say that
the days of opportunity in America are ov-
er. But. opportunity is still very much
around for the individual with good pro-
duct or idea and the enterprise to follow it
up. Sometimes the results can nearly bowl
you over. as demonstrated by one American
housewife in story told in the Carlsbad,
New Mexica Current-Argus.
Back in 1887, in Fairfield, Connecticut,
Mrs. Maggie Rudkin, 40, decided homemade
bread would help her asthmatic son. Al
though she had never baked bread before
she remembered the way her grandmother
used to make it when she was six years DID,
Proceeding accordingly, she used whole
wheat flour, sweet creamery butter, fresh
whole milk, salt, honey, cane syrup and
other ingredients. Her sons doctor liked the
bread and asked her to make some for his
other patients. local grocery store took
some extra loaves, sold them quickly and
wanted more. Other nearby stores and bak-
cries became interested and then her hus-
band, New York broker, began taking
lOaves to the city for sale to an outlet there.
Within a year she was baking 1000
lOaves a week. And here's the cap to the
story. This backyard business grew into
Pepperidge Farm, Inc, and was sold recent
ly to Campbell Soup Company for 357, Alb
shares of Campbell stock, worth approx
mately $28 million. In the words of the
Current-Argus: 1T still can be done in Am
erica'
A QUESTION ON FAIR PLAY
The people of the u. S. have always been
noted for sporting instinct of fair play.
In public affairs they have at times been
confused by political shenanigans, advanced
in the name of the people but which in the
last analysis have limited or destroyed indi-
vidual opportunity.
Nowhere is there better example than
in parcel post Under the law authorizing
this commercial enterprise, which competes
with all other package carriers, it was to
charge rates sufficient to cover the cost of
the service-but that provision has not been
carried out. 1t is free of all taxes-this priv
ilege has been strictly adhered to. This is
anything but fair playi
Government is now in many lines OF
business. It's activities which compete with
private citizens are always exempt from
taxes, and its debts are a mortgage on the
property and savings of every man, woman
and child in the nation.
You may not be in the express business
seeking to survive against tax-free parce
post, but your business may be next
The same political shenanigan of tax
free, cut-rate service can be used to put the
government into any manufacturing, retail
or service activity. Or it can extend govern
ment functions to printing letterheads anc
billboards, in addition to return addresses
on envelopes it now does at prices
no small printer can meet.
You are saving your own liberty anC
opportunity when you oppose tax free, cut
rate government competition with private
citizens.