The retail shopping areas covered by the department stores of New England are indicated in the retail marketing area map, contained in the Market Data Handbook of New England. The bulk of the business of these stores is derived from the territory immediately adjacent to the respective cities in which the stores are located.

Boston, being the largest retailing center, is cited as typifying the usual conditions met with in the department-store trading areas. One of the largest stores in Boston reported that, from a close study of its large accounts, about 67 per cent of these accounts were located in metropolitan Boston. While it was difficult to determine accurately the origin of cash sales, the same store reported that, as nearly as could be determined, 85 per cent of its cash business came from the territory outlined as the retail shopping area of Boston. The rest of the business came from lower-Maine, New Hampshire, and the section of Vermont east of the Green Mountains, running up through St. Johnsbury and Montpelier to the Canadian boundary line. Other large Boston stores confirmed this area, but pointed out that only 1 per cent of their net sales could be said to come from the New Hampshire and Vermont region. These stores, as a rule, claim to get very little business from Providence, and practically no business from Connecticut.

Among the different types of department and specialty stores there is also considerable variation as to the portions of the metropolitan area covered. All the stores draw business from metropolitan Boston. Stores appealing especially to the higher priced range of trade get the bulk of their business, as a rule, from such towns in the metropolitan area as Brookline, Wellesley, Cambridge, Newton, Winchester, Belmont, Arlington, and Milton, while stores appealing to the lower priced ranges of trade draw the bulk of their trade, as a rule, from Boston proper, South Boston, Dorchester, Quincy, Braintree, Everett, Chelsea, Revere, Somerville, and Lynn.

Some of the large stores in Boston have increased the area covered and the intensity of their coverage by opening branches in Portland, Providence, South Hadley, Northampton, Worcester, and other places. Some of the Boston stores maintain branches at such summer resorts as Magnolia, Falmouth, and Hyannis, in Massachusetts, and York Harbor, in Maine. The opening of branch stores depends 01310largely upon two conditions—the degree to which present facilities are being utilized to produce maximum return, and conditions of competition in the surrounding cities available for such expansion.

Southern New England, with its density of population and the close proximity of large towns, makes possible the expansion of territory served. For example, the large department stores of New Haven have leased telephone wires into near-by communities, whereby the store number is listed in the telephone directories of the various local exchanges of near-by towns, and a customer located in these towns may call the store by local call without extra toll charge.

Most of the department stores of New England operate their own delivery systems, which cover at least the burden portion of the retail shopping area. Some stores in the larger cities employ a local express service to care for all of their deliveries because it is found that the expense is less than the maintenance of their own system. In some of the New England cities cooperative delivery in the suburbs has been found practical among the larger stores, but any other application of the principle is generally looked upon with disfavor. The cost of delivery is admittedly high in numerous cases. This expense was reported to vary from as low as 10 cents per package up to 20 or 21 cents. The problem of delivery is not serious in the smaller towns because people there are usually not unwilling to carry home their own packages.

Many of the larger department stores deliver all purchases, including house furnishings, without any restrictions, usually reserving the option to deliver by express, parcel post, or freight. As a rule, all purchases than can be shipped in one package by parcel post are delivered free to any destination. If the customer requires special delivery or special handling the additional charges are borne by the purchaser. Delivery by freight is usually only to the freight station of the purchaser and does not include delivery to the customer's home.

While delivery practice differs among the various stores of metropolitan Boston, it may be stated generally that store operating their own delivery systems cover Boston proper, Cambridge, Watertown, Arlington, Brookline, and other adjacent towns two or three times a day; while Newton, Waltham, Belmont, Medford, Malden, Melrose, Revere, and other outlying towns are covered about three times a week. Local express is used quite largely for deliveries to Braintree, Weymouth, Hingham, Cohasset, Westwood, Canton, Winchester, Woburn, Reading, Wakefield, Sagus, Lynn, and Swampscott.

There has been some agitation from time to time for cooperative delivery systems among the larger stores as a means for reducing delivery cost. Waterbury, Conn., has a cooperative delivery system that is said to have been in successful operation over 10 years.

Delivery is usually looked upon as an essential item of service, and most store managers consider that it must be kept in the hands of the individual store in order to function properly. Many merchants desire to retain the high advertising value which they place upon their trucks. Moreover, with electrical specialties, furniture, and some other goods which require special handling, they must maintain their 01411own trucks in order to assure good service. A few stores have also advertised an additional feature of having the drivers of their trucks take orders and it is claimed that this practice has met with unusual success in staple merchandise lines, especially during the summer months, because it relieves customers of the necessity of shopping in hot weather.

In Boston some of the larger stores have an independent arrangement for delivery, known as “The Clearing House Parcel Delivery,” whose service covers all but 18 towns in the outer border of the metropolitan area, the towns excluded from this service representing about 13 per cent of the population of the whole area. Through this special service over 1,768,000 packages were delivered during the year 1926. For delivery of heavy items and furnishings, such as furniture, china, glassware, pictures, hardware, kitchen goods, electrical devices, and special apparatus, most of the department stores in this special-delivery system operate their own trucks.

The seriousness and urgency of the traffic problem from the retail merchants’ point of view is summed up in the words of a prominent merchant, who said, “If merchants do not do something to relieve the present traffic situation, within 15 years there will be no down-town shopping districts of any importance.” This problem is not confined to large cities alone, but is recognized by merchants event in the small trading centers. Because of the rapid increase in the number of automobiles it has been difficult to keep pace in adjusting conditions to them. The automobile has outgrown the traffic facilities of even our most modern cities. In the older New England cities the retail districts are in sections laid out long before the automobile or the present congestion of population, so that wide streets and parking places are not available. This rapid increase is seen by comparing the automobile registration figures for 1927 with those for 1924, which show an increase of approximately 80 per cent for New England as a whole.

Traffic counts by the Boston Chamber of Commerce and the Boston City Planning Board, taken on July 1, 1926, and the same day in 1924, showed an increase of 21 per cent in the number of vehicle movements between 8 a.m. and 6 p.m. into and out of the down-town district of Boston, 169,520 vehicle movements being recorded in the 10-hour period in 1926. It is said that the congested traffic of down-town Boston has added considerably to the business of local retailers in outlying towns, like Malden and Lynn. One of the Boston specialty shops opened a store in Brookline largely to offset the handicaps of congested traffic. No illusions are held, however, regarding such a venture, after it is pointed out that in the higher-priced lines the customers still prefer to shop in the larger stores of down-town Boston, regardless of traffic inconvenience.

Aside from providing new and adequate streets and securing relief through more systematic enforcement of reasonable traffic regulations on the part of city authorities, the larger department stores themselves have taken steps to meet the changed conditions brought about by traffic congestion. Some stores operate garages in which free parking is given upon presentation of a purchase ticket from the store; with 01512provision of free conveyance by bus between garage and store. Also some of the stores are assisting in relieving street congestion by operating busses jointly in the shopping district, which customers may use free of charge in going from one store to another, leaving their own cars in a garage.

The Boston Retail Trade Board has arrangements with three garages, with a total capacity of 1,900 cars, to park the motor cars of shoppers. Parking is provided from 9 a.m. to noon without charge, and thereafter to 6 p.m. at a rate of 10 cents an hour, with a maximum charge of 25 cents. None of these garages is centrally located, but good bus or subway connections are available. Other means that have been proposed for remedying the traffic situation are:6 (1) the construction of new garage space; (2) modification of garage charges, such as flat monthly rates for daytime parking, with the privilege of intermittent storage throughout the day; (3) the location of parking spaces at street-car and subway terminals.

Independent local stores handling the lower-priced lines find keen competition from chain stores, especially in the large mill towns. In communities where there is a strong demand for cheap merchandise with pronounced styles, competition from chain specialty stores is especially keen in women's and misses’ ready-to-wear lines. One important respect in which the ready-to-wear chains suffer, it is said, is the difficulty of attracting women who are accustomed to shopping in higher-priced stores and who do not care to mingle with chain-store customers. Furthermore, the chain store usually lacks the surroundings and atmosphere of the higher-priced independent store.

All of southern New England, with its density of populations, is a fruitful field for door-to-door selling and mail-order business. No authentic figures are available upon which to base a reliable estimate of the volume of this type of business, by checks that have been taken from time to time by merchants in various communities indicate that the volume is considerable. Door-to-door selling seems to be sporadic in its intensity and is limited chiefly to stockings, corsets, and underwear, although attempts are made occasionally to sell shoes, and even cloaks and suits.

Some sections of New England seem more favorable to door-to-door selling than others. For example, in Connecticut, especially in the shore-line towns and in the lower end of the State, merchants complain of a great amount of this type of competition. This is claimed to be due to the proximity of the great number of clothing manufacturers and agents in New York City, who seek additional outlets for their goods.

Retailers generally agree that there is quite a distinction between the leasing of “service sections or departments” and “merchandising sections or departments.” Until a few years ago leasing in retail stores was restricted, as a rule, to the purely service sections. For example, in the larger stores in New England having such features as beauty parlors and pattern sections, these departments are practically 01613all leased, for they are looked upon as unrelated to the main business of merchandising.

Leasing has grown until it extends to such lines as radio, electrical specialties, and mechanical appliances, and has even reached departments carrying style merchandise, such as jewelry leather specialties, furniture, shoes, men's clothing, and millinery; the practice has been extended in some instances even to women's cloak and suit departments.

It has been stated by millinery experts that in cities of 35,000 and over fully one-half of the millinery is distributed through “syndicated lessees,” who are specialists in distributing one kind of merchandise. These syndicates have chains of leased departments, each unit of which is operated under the general direction of the chain organization. Style changes in millinery are frequent, and once the style is changed the merchandise has to be disposed of for little or nothing. The syndicates with leased departments in a number of stores have a wide outlet and can shift their stock from one section of the country to another, so that they are always assured of a market to complete the sale of any line handled.

As a rule, the management or owners of a store expect to gain one or all of three specific advantages from leasing departments, as a result of the lessee's specialized knowledge of the merchandise handled or the labor involved. These advantages are store expansion, superior purchasing facilities, or increased volume of sales in the leased department. The financing heads of the business are often in favor of leased departments primarily because of the income derived and the simplicity of what amounts to a real-estate proposition. From the merchandising point of view, leasing is often found objectionable because in most instances owners of leased departments are absentees, and the departments are run by managers or indirect representatives. While generally the store has authority and control over the employees of leased departments, and they are under the supervision of the employment manager, it is very difficult to regulate these departments to fit in with the general store policy and to keep mutual harmony.

It is difficult to give a detailed discussion of the leasing of departments in New England stores without disclosing their identity. It may be said, however, that the greatest number of leased departments found in any one store was 12 and their aggregate volume represented about 12.7 per cent of the store's total business. There seems to be a growing sentiment among New England store operators against the policy of leasing departments, with the exception of the purely service features previously mentioned.

In the merchandising of electrical specialties an idea somewhat different from the leasing of departments seems to be developing; this is referred to as a direct selling arrangement with the manufacturer. Under this plan the manufacturer maintains his own representative and selling force in the department. From the store point of view it is difficult to maintain a force of salesman for specialties, such as vacuum cleaner, washing machines, and refrigerators, that are sold largely by the canvas method from door to door. This type of specialty salesman is constantly changing from one line to another and is consequently very unstable; the high labor turnover 01714means a high cost of selling. Crew managers, who are high-priced men, are usually necessary for this type of work, and their direct production is relatively small. The manufacturer seems better fitted to handle this sort of sales organization, the advantage to him being derived from the support and use of the name of the store for which he is operating. In door-to-door selling it is almost impossible for the independent canvasser to get a hearing, but the interview resistance is largely broken down if the hearing is secured in the name of a first-class, well-known local store. Sales resistance also is broken down, for the prospect may have the item charged to her store account with the knowledge that if anything goes wrong with the specialty the guaranty of the store is back of it—an advantage which can not ordinarily be secured from the independent agent or agency. It remains to be seen how widely and how effectively this type of distribution can be used.

While the number of department stores operating basement stores is not large, they are said to be growing in southern New England, and especially in the vicinity of Boston. Some merchandise managers have given up attempts to operate basement stores simply because these outlets did not show returns as quickly as anticipated. Some who were interviewed had a basement store under contemplation, but were hesitating for fear that it would tend to “merchandise down” the main store. Those who have made a marked success with this type maintain that a basement store should be run absolutely independently of the general organization; otherwise there is too much interplay of policy, with the likelihood that the basement store would “merchandise down” the departments in the main store. It is also pointed out that if a basement store is used merely as an outlet for marked-down merchandise shoppers soon become aware of the fact; and in consequence the sales in the main store suffer, largely because of loss of confidence in its merchandise.

Boston has the distinction of having the only two automatic basement stores in the country. During the year 1926 their aggregate net sales were well above $10,000,000. At various times attempts have been made to establish automatic basement stores elsewhere, but these are said to have failed, primarily because they were not consistent in their purposes or policies.

The plan of operation of these automatic basement stores is, in brief, as follows: The goods are brought into the store and given a mark-up averaging from 27 per cent 27 or 27½ per cent above cost. Mark-ups are almost as high as in the main store, largely because of the fact that a good deal of the main-store burden is charged to the basement store. If they could be rid of these charges the basement stores could be operated with much less mark-up. As this is merely a matter of policy the only essential is that the policy be consistent. After the goods are originally marked up they are put on sale 12 days at the original mark-up price. The price ticket bears the date upon which the goods are placed on the counter for sale. If they are no sold within the first 12 days, they receive an automatic reduction of 25 per cent, and remain at this reduced price for 6 days, when they are again reduced 25 per cent; if not 01815sold at the end of the next 6 days they are given away free to charitable institutions, hospitals, and the like. The reductions are all made from the original mark-up prices.

It is claimed that from 75 to 90 per cent of the merchandise is moved on the first place, and that the greater portion of the remainder, probably 70 per cent, moves on the first mark-down. It is claimed further that less than 1 per cent of the net sales of merchandise is given away. The reason given for the high percentage of goods moved on the first mark-up are (1) that great care is used to select the type of merchandise that buyers want, and (2) that in this case it is the competition of buyers and not competition of sellers that fixes the price and moves the goods.

Operating expenses must be watched closely and kept at a minimum. Much of the merchandise is of the type that needs little or no selling ability, and to a large degree it moves itself. In departments such as ready-to-wear men's clothing and shoes a certain amount of sales ability is required. In order to keep operating costs down, no deliveries are made except with a delivery charge. An average charge of 10 cents a package is made on certain items, such as rugs. This charge is not meant to cover full delivery costs, but the loss is absorbed in the general delivery expense. The number of C.O.D. sales is at a minimum because the customers that come into these basement stores do not often trade on this basis; on C.O.D. sales a deposit is required before the goods leave the store. Losses from merchandise that is soiled or too badly crumpled to sell are said to be small, because people who come in and handle the merchandise are, as a rule, competing for its possession; hence, it moves too rapidly to become shopworn.

These stores are in no sense limited as to sources of their merchandise. The greater part of the merchandise is equal in quality to the merchandise sold in the rest of the store, but for some reason did not sell at their nominal price. There is usually a certain amount of seconds, fill-ins, mill sales, bankruptcy stocks, and, in some cases, stocks from fires. There are no price limitations in the purchase of this merchandise, the only requirement being that the cost must permit selling the goods at a bargain price. Quite a little merchandise is bought in Europe, but this consists mostly of what might be termed window pieces and “stock sweeteners,” added to make the stock more attractive.

It is claimed that to be successful an automatic basement must he connected with a store of substantial size and of considerable reputation in order to establish confidence. If a small store attempts to operate a bargain basement, especially in a community where the idea is not well known, the basement store has no prestige and tends to be regarded by the consuming public the same as a job-lot, bankruptcy, or fire-sale plan, rather than as a legitimate scheme of merchandising. Another essential feature pointed out was that the store should be located within readily accessible distance of a primary market.

The whole subject of the advantages and disadvantages of buying organizations seems to be a moot question among store operators and managers. It is generally agreed that the chief advantage of such 01916organizations is the exchange of store figures and operating statistics. The chief objections raised are that they lack centralization of control, and that it is often difficult to get buyers from individual stores to agree on patterns and styles. It is generally pointed out that, as matters stand, there are very few merchants who are willing to grant sufficient authority to a central organization to insure successful cooperation in buying.

Most of the larger department and specialty stores in the principal cities of New England, and a few in the smaller towns and centers, belong to some form of buying organization. Some stores either belong to buying organizations or maintain resident buyers in the large primary markets, principally in New York City; while a few of the largest use both means of buying. Some of the large stores have central buying offices in New York, primarily for the convenience of department buyers on their trips, in charge of a local manager, whose functions are limited. A few of the larger stores maintain offices in the primary markets of Europe, such as Paris, Berlin, London, Vienna, Budapest, and Prague.

With the best varieties of merchandise handled by the modern department and specialty store, it is difficult to point out sources. As a general proposition it may be said that merchandise is bought locally in New England whenever possible, if for no other reason than the obvious one of getting better service and saving transportation cost.

Stores that are selling popular priced lines in which the style element is not dominant, and those catering to a demand for conservative and staple merchandise, do a large part of their buying in New England, particularly around Boston. This is especially true of stores located in cities of the Boston, Portland, and Bangor trading areas; while stores of this type located in the Providence and Worcester areas, and even in the New Haven area, do some buying in Boston, especially in fill-in lines of women's ready-to-wear, and in staple lines of men's clothing. These areas, again, with the Hartford, Springfield, Pittsfield, Rutland, and Burlington areas, do their major buying in New York City. Where the style element is the dominant factor, New York is said to be the primary market for all New England.

Such merchandise as silverware, cutlery, paper, branded goods in sheets, pillow cases, and blankets, as well as certain types of furniture, are bought largely in New England. Some lines of children's wear are bought in Boston and in New Haven. Many of the larger stores are buying textiles and piece goods of various kinds direct from the mills, using the dry-goods jobber to fill-in. It is generally pointed out that a great quantity of goods made in New England in the line of textiles especially, is bought from New York. The source of these textiles is almost impossible to trace because they lose their identity in going through the hands of the dyer, the finisher, and the cutter-up.

Many merchants in small Vermont and New Hampshire towns complained of the careless way in which some manufacturers of women's ready-to-wear garments filled their orders. In some invoices as many as 8 or 10 items out of 15 were said to be improperly filled, with patterns or styles different from those ordered, or garments not properly sized. These are particularly keen grievances because the 02017merchants claim that if any mistake is made through the importer sizing of dresses they lose the trade of their customers. As a result of such mistakes many of the dresses have to be returned and the dealer's stock is thus depleted during the interval necessary for making exchanges, as none of these stores can afford to carry a large and expensive line. These business men are keenly aware of their loss from such treatment and resent it.

During the past two or three years considerable quantities of clothing have been imported from abroad—shoes from England, sweaters from Scotland, and from Germany women's hats with silk body coverings made in France. A considerable quantity of children's suits of washable materials has been brought in from Germany, and of men's clothing from England.

Some of the stores are pushing the idea of handling goods “Made in New England.” Several of the larger stores cooperated in making up a partial list, by departments, of the types of articles purchased in New England. It is not to be understood that this represents all the items of merchandise purchased in New England, neither does it signify that the entire requirements of any one article are purchased in New England. To list all the items, with their origins, for even a moderate-sized store, would require more space than is warranted. The partial list of sources and articles purchased from respective New England cities by department stores and specialty shops is as follows:

State and cityArticle

The advertising of department and specialty stores in New England takes many forms, but the chief mediums used are newspapers and direct-mail advertising. Besides advertising in the regular newspapers, the department stores in some of the larger mill towns carry a certain amount of foreign-language advertising in French, Italian, Hungarian, and Portuguese newspapers. Some stores, however, have eliminated the foreign-language newspapers, holding that most of the people of foreign stock read English or have some one in the household who can read English; consequently there seems to be a growing feeling that such advertising is probably, on the whole, not the best use of the store's money.

It is claimed that there is a growing tendency on the part of some large stores to extend the use of direct-mail advertising. It was freely admitted that there is always great difficulty in getting the right sort of direct-mail advertising. Too frequently the copy is not prepared correctly, and if it meets the best standards it is often sent out incorrectly, or the mailing lists are not kept up to date.

One of the most successful New England stores in mail-order advertising has built up a card catalogue of names of some thousands of customers and prospects. Changes of address are carefully checked, and return postage is granted in order to cull out dead names. These cards are divided by classes into charge accounts out of town, cash accounts out of town, charge accounts in town, and cash accounts in town. The cards are further divided by departments in which the principal volume of purchases is made. Cards are gone over very carefully to select the names to which particular pieces of advertising shall be sent, for it seldom will cover or fit the whole mailing list. For example, if customers are found who buy only one or two items of the many carried by a particular department they, rather than the customers who are in the habit of buying the general line, are canvassed in an endeavor to sell the other items of the department.

Another large store has been successful in direct-mail advertising by specializing, in the coat and ready-to-wear departments, in large 02219sizes for stout women. A list over 8,000 names of women who require large sizes has been built up, and whenever the store is able to get a good buy on large sizes, or is able to offer a specific sale or reduction, this list of names is canvassed by mail.

Fifteen of the department and specialty stores of Boston have undertaken what is said to be the first all-day radio shopping broadcast to be instituted in the United States. These broadcast continue from 8 a.m. to 6 p.m., divided into 8-minute periods, with 5 minutes devoted to shopping news or talks on store policy or features, and 3 minutes of music. Full-time service consists of five broadcasts a day for each store, while a part-time contract calls for three broadcasts on one day and two on the next. Copy regulations require that all copy be turned in 42 hours prior to the time of broadcast. Price corrections are allowed until 6 p.m. of the day before the copy is to be run. Upon the notice of any one store the copy may be withdrawn and the space filled in with copy of an institutional character. It is considered by the stores interested that this method provides a very low-cost form of advertising.

Probably one of the greatest weaknesses of this scheme is the tendency for the talks to degenerate to a plane of monopoly, regardless of the spice, individuality, and interest which the reporter may try to put into them. It is generally agreed by the advertising managers of the stores interested that, no matter how successfully the scheme may be developed, it will never in any sense replace the necessity of newspaper advertising. At its best it will operate only as a supplementary medium, probably having its main appeal for the woman perusing the pages of the daily paper in search of special shopping items.

Department and specialty stores as a whole have been keenest among retail outlets in efforts to reduce cost and eliminate waste. Their endeavors have taken sundry forms, including the exchange of operating figures of stores belonging to the same buying organization; discussion through controller's congresses; cooperation of various stores within a given city, by voluntary association or a retail-trade board; and efforts of individual stores within their own organizations. Since it is impossible to record all the steps taken to eliminate waste and to reduce sales cost, only a few of the principal ones are discussed.

Annual increases in sales volume of department stores in the past have been due to a variety of causes, such as increased urban population, development of rapid transit and improved highways, the ever-increasing growth of automobile transportation, and last, but not least, the shift of effective demands for certain types of merchandise from small towns to the large cities. These increases in sales volume have had a tendency to conceal the effects of bad management, but as soon as the increased stops the expense ratio rises. The advance in expense ratio is not necessarily to be met by increase in sales volume, but rather by better control of merchandising operations.

Cooperation among stores has been especially marked in Boston and New Haven. They have accomplished savings through cooperative buying of certain types of such commonly used supplies as gasoline, merchandise bags, gift boxes, package handles, office furniture and supplies, typewriters and typewriter ribbons, automobile 02320tires, tire chains, and accessories. The stores of Boston have cooperated in the use of motor express on shipments of merchandise from New York to Boston, with a saving in transportation costs of over $46,000 for the year 1926, while the savings for the year 1927 were estimated to be approximately $75,000.

Opinion was found to differ widely among store managers as to the possibilities of reducing costs in individual stores. Some contented that the only possibilities were to increase sales volume and to check as far as possible any further increase in service rendered by department and specialty stores.

A number of store managers contended that, outside the ordinary small problems of any business, the biggest single step to be taken in the elimination of waste is the reduction of competing price lines or ranges within the same store—a problem lying especially in the province of the controller. It was claimed that such competition of price lines does more to increase stock and to cause mark-downs and consequent waste in of merchandising through competition between competing lines than any other factor. A good illustration of this is taken from a large New England store that formerly carried dresses ranging in price from $19 to 427.50, and from $29.50 to $32.50, all within narrow competing price ranges. The present price ranges are on a class of dresses to sell about $25, another to sell at about $35, and a third to sell at $45 and up. Of course, it is always hard to eliminate waste in respects where style is concerned, became the very element which gives style its value is rapidity of change.

New England stores in increasing number are adopting the unit system of stock control (the basis of which is a record system for arriving at customer demand through an analysis of customer's purchases). The controller for one of the largest store in the country believes that this has the greatest possibility for reducing selling costs. The unit system of stock control is claimed to increase stock turns and to relieve capital, thereby lowering the cost of merchandise to consumers and bringing higher profits to stores. One of the stores in New England which adopted this system claim that its volume was more than doubled from 1921 to 1926 ($700,000 to $1,500,000), and mark-downs decreased from 12.9 per cent in the spring of 1992 to 2.6 per cent in the spring of 1926. It was further pointed out that with a doubled value of sales in 1926 the average stock investment was probably the same as it was in 1921.

Merchandise operations instead of adding to the expense, have been a material factor in decreasing it (a) by the elimination of bank borrowings for merchandise requirements, thus saving interest charges; (b) by decreasing insurance charges, as a result of smaller stocks; (c) by decreasing advertising expenses, through a greater concentration on items for which the public has a already shown preference (by advertising to coincide with normal movements of goods the store has increased the productive power of space used); (d) by more productive allotment of selling space, both in size and location.

The usual argument against the unit system of stock control is that it costs too much money to operate. With this point of view a number of stores apply the system to women's ready-to-wear or cloaks, but refuse to apply it generally. One store doing an annual volume of $1,600,000 has adopted the system throughout the store, and claims the cost to be only eight-tenths of 1 per cent, which is far offset by the increase in net profits.

One of the problems most often stressed was the peak periods of daily merchandising, and the possibility of leveling off the peaks and distributing the load. In cities of over 200,000 population 81 per cent of sales were found to be made from 11 a.m. to 3 p.m. and only 19 per cent of the sales from 3 p.m. until closing time.7 In cities of 50,000 to 200,000 population only 1 per cent of the sales were made from the morning opening of the store until 11 a.m., 45 per cent of the sales from 11 a.m. until 3 p.m., and 54 per cent from 3 p.m. until closing time. In cities from 10,000 to 50,000 population 3 per cent of these sales were reported from the morning opening until 11 a.m., 9 per cent from 11 a.m. until 3 p.m., and 88 per cent of the sales from 3 p.m. to closing time.

As a remedy for this situation a number of the larger department stores in Boston, Providence, New Haven, Waterbury, and other places claim that if they could get the other department stores and specialty and dry goods stores in their communities to agree, they would be in favor of opening at, say, 10.30 in the morning and closing at around 4 in the afternoon, with no time off for lunch for sales persons and other employees, or at least limiting the time for lunch to 5 or 10 minutes within the store.

Nine Boston stores in 1925 cooperated in a study, said to be the first of its kind ever conducted in the Uuited States, regarding the causes and the extent of returned merchandise. This study, stretching over a period of eight weeks, showed that in 11 departments common to each store there were around 58,000 separate returns of merchandise of a total retail value of approximately $722,000. As a result of this study the percentage of returns to all sales was reduced in one store from 12.2 per cent in April, 1925, to 8.4 per cent in August, 1925. Over the same period another store showed a decline in returns from 16.4 per cent to 12.4 per cent. From records kept on file these decreases were shown to be greater than seasonal decreases of other years, so that such decrease could not be attributed solely to seasonal variation in buying. An analysis of the reasons for returned merchandise is presented in this bulletin in the discussion of “Consumers’ buying habits.”

Considerable competition exists between specialty houses, chain stores, installment houses, merchant tailors, and mail-order houses. Generally speaking, the independent clothing stores come into competition with the chain stores and installment houses at the lower end of the price line, while at the medium and upper end of the price line they face competition from the men's clothing departments of department stores and from custom tailors. In the clothing business there has been a distinct growth of the specialty store with fine appointments, selling a one-price or, at the most, a two-price line. This trend is also shown in the chain-store development, which is a matter of serious competition not only to the retailer but to the manufacturer as well. With the large purchasing power of chain stores, it is claimed that they tend to play one manufacturer against the other, a situation said to result from the disorganization in the retail trade.

New England has several local chains, one of which operates more than 40 stores and another 7 stores, the latter chain having locations in Maine and eastern Massachusetts cities. One national chain selling high-grade clothing and operating some 28 stores throughout the country has four New England stores, located in Boston, Providence, New Haven, and Worcester. The credit clothing chain and the individually owned credit store find themselves faced with a new type of competition from the chain clothing store specializing in men's clothing at one fixed price, usually $22.50 or less per suit. It is stated that the rapid growth of the latter type of store, making it possible for the customer of the credit store to buy a garment of relative value for a comparatively small cash outlay, has put the independent credit stores on the defensive.

That the chain selling suits at a single price of $12.75 has a logical place, is the belief of many merchants in the field. The margin of operating cost and profit is considered sufficiently large, with the 02623proper stock turn, to be comparable with that of the $22.50 clothing shops. It is also pointed out that no large proportion of foreign-born population is necessary for the $12.75 store, since the clothing is sold to all races and classes. In the mill towns large portions of the working population are seeking low prices and patronize the average low-price chain.

The textile depression has aided the low-priced chain store during the past five years, but with the improved conditions in certain communities it is problematical whether all the chains will survive. On the other hand, one prominent New England clothing manufacturer who had made a study of the New England merchants in towns of 5,000 to 25,000 population said he was convinced that the average small-town merchant had a hard time clearing his stock, and that he seldom secured more than two stock turns a year. Many such merchants have merchandise in their stock from 3 to 15 years old; and when taking inventory they figure no depreciation on such stock but put it in at cost. In his opinion the business of small-town merchants must be radically modified to fit the changed conditions, and to withstand the inroads of chain-store development.

Those in the business claim that the merchant tailor is passing out of the clothing industry largely because he can not meet the competition of the retail clothing store, either in style, fit, or price. It is claimed that the merchant tailoring business no longer draws competent men, for they can, too, readily find employment with manufacturers of nationally advertised clothing at incomes that are much more attractive.

Retail clothing establishments are not doing very much in the mail-order business, largely on account of the difficulty of fittings; but some of the men's departments of the larger department stores are doing a considerable amounts of mail-order business in men's small wares and haberdashery. In the cheaper lines of clothing and in men's furnishings, the mail-order houses also are doing a considerable volume of business.

Clothing merchants claim that they confine practically all their advertising to newspapers, and that, for the most part, they have given up comparative price advertising and have stressed the advertising of values. About the only time price is advertised is at the January and midsummer clearance sales. Many of the large stores have gone in for billboard advertising at one time or another, but those that have used this medium question its effectiveness. Merchants generally agree that they have not used direct mail advertising as effectively as it might be used. Many felt that they had to keep within a 3 per cent limit of net sales as a basis for advertising appropriation, and, believing that the newspaper was probably the most effective medium, they were therefore limited in the amount to be spent on direct mail advertising.

In the opinion of many clothing merchants, nationally advertised brands mean less to the average consumer that they did some years ago. Some merchants claim that brands are no longer asked for, and that the same is true of the label in clothes. It is said that the real demand is for the product of a certain store or for of particular salesman in whom confidence can be placed, and the brunt of the selling 02724is left in the hands of the store or the salesman. These merchants stated that there was probably some foundation in the statement that consumers feel they are paying more for nationally advertised brands than for brands not so widely advertised. There was said to be in some cases an objection to nationally advertised brands on the part of the buyers for large clothing stores, due to the fact that the stores must carry a substantial stock of such lines, thereby robbing the store's buyer of more or less of his initiative in selecting and merchandising goods.

Merchants claim that in clothing men generally look first for what they consider quality in the cloth, price coming second, and tailoring and the general finish of the garment coming last in their appraisal. In the upper-price ranges of clothing, style is probably of first importance, then price, and quality last. In the lower-priced merchandise price undoubtedly comes first, followed by style and quality.

New England men in general are referred to as conservative dressers. Merchandisers who have had experience in various parts of the country claim that they are, on the whole more conservative in dress than men of any other section. Quality, plus a conservative style, has an especially strong appeal to the well-dressed New Englander. It was pointed out that high-grade hats have sold widely in New England mainly because they were merchandised well, with much thought put into the selling. On the other hand, it is claimed that the success of these two hats is due in great part to the felling of the consumer that they were quality products.

The size of sales is reported to have diminished since the war. There seems to have developed a distinct trend away from the purchasing of a stock of shirts or underclothing to last a period, to the purchasing of fewer articles at a time or for a single occasion. A man going away for the week-end will stop in a store and buy a single shirt, in contrast to the old practice of buying two or three shirts or a half dozen at a time.

The automobile is said to have influenced the purchase of men's clothing by popularizing sport wear, so that men can wear sport clothes into a hotel or golf club and still be dressed in good form; although there are certain mill communities in New England where sport clothing can scarcely be said to be popular. Merchants claims that the automobile has influenced men to buy less clothing; they are buying less frequently, and there is a tendency to buy cheaper clothing.

The department stores invariably get a large portion of the business in men's furnishing and haberdashery because of the fact that women seek sales values and make purchases for their men while shopping in a department store. In many communities the stores close at an earlier hour than the factories, so that workingmen find little time to buy, and woman must of necessity shop for them. It is also pointed out that the prejudice on the part of women against entering a men's store is rapidly passing away, and recent years have seen more women shopping in the strictly man's store. Especially in the cheaper lines of clothing and in rural communities, women are reported to play a considerable part in the purchase of men's clothing, for they frequently accompany the men folks and influence the sale by their approval or disapproval.

Since New England is the home of many colleges, considerable interest attaches to college students as a source of trade. Merchants in New Haven say that a pronounced decrease has been noticed in the spending by students. The principal reason offered for the change was that students were spending more of their incomes on automobiles and their upkeep. The statistical department of the Tuck School of Business Administration, at Dartmouth, has found that the Dartmouth students spend for clothing an average of $226 per year, which represents about 15.2 per cent of the total expenditure of the average student over a college year. About 5 per cent of the students, representing those that spend the most money in college, spend an average of $636 a year for clothing. Merchants generally point out that if students influence styles at all they influence the style of specialty items, such as slickers, sweaters, neckties, and the like, rather than the main items of clothing. Merchants claim that manufacturers’ of clothing often expect to sell merchandise featuring school colors or clothes that are designed as “collegiate.” As a matter of fact, the students of large universities and colleges in New England are conservative dressers, and special colors and styles are worn only on a few stated occasions of the year, such as major athletic events.

In the sale of men's clothing certain racial peculiarities of customers deserve consideration. For example, Poles were regarded as desirable customers, generally paying cash for their purchases. They were referred to as very stolid people, who seldom openly indicate their likes and preferences. If the merchant has the thing they like they buy, and if he has not they simply walk out of the store without criticizing or passing comment. If they find a piece of cloth or a suit that is wanted, that particular article must be had and no other, and it is up to the store to make the goods in question fit. This means that a good many suits have to be rebuilt. As a result of this one high-grade store in a large Polish community had to have three tailors to make alterations. Such practice, of course, tends to increase selling costs. Among the French Canadians the men are said to do more shopping for their clothing than the men of other nationalities, and they tend to be meticulous in their requirements for furnishings and tailoring. The Finns, Poles, and the French Canadians, in localities where there are large groups, show a preference for dealing with stores in which there is a salesman speaking their own language.

In the present keenly competitive age, credit is the prized weapon of the progressive merchant and is advocated as a real necessity for the consumer of small means. Credit is recognized as an important selling feature. There are budget plans, weekly payment systems, and charge-account concessions in great variety, even in the highest grade stores.

Many of the larger and older houses do business for cash; what credit business is done is transacted on open account of 30 days, though in certain instances this tends to stretch up to 60 days. A few houses reported as much as 50 per cent of their total volume on open account.

A credit arrangement that is growing quite rapidly and gaining in popularity in New England is a 10-payment plan, often disguised 02926under various names. Under this plan a down payment of 25 per cent of the sale price is required. The balance is paid in 10 weekly installments under a regular signed customer's agreement, although this written formality is not always required. Under this plan a notice goes out to the customer immediately when the date of payment is past, while under the open-account method a total of 60 days would expire before the first notice was received. It is pointed out that under the old plan of allowing 30 days’ credit on open account, the time actually required for payment of a bill averaged considerably over 60 days; while under the 10-installment plan practically all the accounts are closed before the end of two months. A considerable shortening of the credit period is thus effected by the limited-payment plan.

The regular installment houses cater largely to buyers with an income between $30 and $40 a week. A first payment of $5 or $10 is usually expected on a suit of clothes selling from $30 to $40, and the usual terms for the balance are $2 per week. Although full payment of all accounts within 15 weeks is usually specified, an analysis of records shows that accounts run, on the average, approximately 20 weeks. A 10 per cent discount is usually given for payment of bills within 30 days.

Some of the more successful clothing merchants in the field suggested a policy of three definite price ranges in each department in the store, and the purchase of no merchandise, no matter how tempting, which does not fit into these price ranges. It was contended that the average merchant would find upon analyzing his sales that three classes of customers come into his store—those to whom a low price is the foremost consideration, those who want medium-grade merchandise, and those who want quality merchandise. It is contended that the price ranges in the clothing department, the shirt and neckwear departments, as well as in other departments, should be made to fit these three classes of trade. If the merchandise in the top range does not sell it may be progressively marked down to the next lower range; and merchandise in the lowest price range which does not sell may be disposed of in general semiannual clearance sales.

Some of the men's clothing and furnishing stores in the larger cities operate their own delivery trucks, but most of them hire an express to do their local delivery, considering private delivery service too expensive. Practically all deliveries outside the local urban centers are made either by parcel post or by express. Parcel post is used in small towns and rural communities in which express companies have no office.

Although Boston has a considerable amount of clothing manufacture, it is not considered a major market for the New England trade. One large local chain operating in New England is said to buy as much as 60 per cent of all its requirements in the Boston market. A large department store operating a men's store manufactures a portion of its clothing, making some 20,000 suits a year, and buys only about 2 per cent of its total requirements in the Boston market. 03027A number of high-trade stores in New England stated that they buy only a small portion of the lower priced range of their line in Boston, while many buy nothing at all in that market.

It is difficult to define the clothing manufacturing trade in Boston, because of the number of small operators, quite a few of whom are really contractors instead of manufacturers. Nine concerns are said to make about 75 per cent of the total volume. The clothing strike a few years ago is said to have wrought considerable change in the Boston clothing industry. At that time a number of old, reliable houses liquidated, being unwilling to cope with the difficulties of the labor situation. This, in turn, brought in a large number of small operators, among whom failures were numerous, constituting a serious drain upon the industry by creating keen competition and disorganizing the local trade beyond the point of effective operation. Steps have recently been taken in the Boston trade to form an organization patterned after the Philadelphia Clothing Manufacturers’ Association, to act as a clearing house for credits, and as a cooperative group for advertising and boosting the Boston clothing and furnishing market.

The New York market is the dominating center of the men's clothing business, largely owing to the great number of manufacturers located there. Their location gives them the advantage of a large metropolitan area that is following the latest style trends, plus the favorable labor conditions under which the industry has become largely intrenched.

Philadelphia has always been a keen competitor of Boston. The trade attributes this largely to the difference in labor conditions. Baltimore has been increasing rapidly since the war as a men's clothing market, and many New England merchants report the increasing use of this market as a source. Baltimore is beginning to make keen competition for the Boston market. For the higher grade clothing Rochester, N. Y., Jamestown, N. Y., and Chicago are drawn upon to a considerable degree by New England merchants.

There are only two men's clothing houses in New England that are strictly jobbing houses. Most New England houses classified as jobbers are also manufacturers. Some that are listed as jobbing houses of men's clothing deal for the most part in children's clothing. New York is the prime center for the manufacture of children's clothing, and the houses in New England, by the very nature of things, are jobbers. There have been some sporadic attempts to manufacture children's clothing in New Haven, and some in Providence and Worcester, but most of the manufacturers are small operators.

A large part of men's furnishings comes from Boston, which has one of the leading dealers in this line in the country. Neckties come largely from New York and Boston; shirts from New York, Troy, Glens Falls, Philadelphia, and points in Maine; underwear, pajamas, and nightgowns, from New York, and from Boston, Cambridge, Taunton, Needham, Barre (Vt.), and certain other cities in New England. A great portion of the footwear comes from Brockton, Abington, and Haverill, while some lines come from New York and St. Louis; leather goods come from around New York and some from Worcester, and some is imported from abroad.

Terms reported in buying clothing from manufacturers varied from 2 per cent up to 7½ per cent in 10 days. A few houses are said 03128to have been apparently cutting the price of clothing, but as a matter of fact they were also reducing their discounts, so that the merchants had to watch discounts very closely in figuring mark ups. There has been some complaint from manufacturers that retailers are buying less clothing at the opening of the season, expecting to buy merchandise later in the season at their own prices, with reductions of 25, 30, and even 35 per cent.

Another source11 credits the six New England States with 3,648 stores, in five types of outlets, as shown in the following table:

Probably the source of keenest competition and the one complained of most often in the furniture trade was that of retail stores which use what are termed objectionable selling methods, commonly referred to as “borax” houses. The presence or lack of this type of competition was not so much a matter of a particular type of store or of distribution, as a matter of the kind of local management. The so-called “borax” method depends upon the use of misleading advertising to draw inquirers to the store, and employment of “strong-arm” selling methods after the customer has entered the store. The 03229whole principle seems to be based upon getting people into the store and selling them before they have opportunity to compare prices or values. This type of competition is confined mainly to the cheaper grades of furniture. It is pointed out that New England has been a fruitful field for the growth of such competition, largely because of its large foreign population and its high proportion of semiskilled and unskilled wage earners. In rural northern New England competition of this sort is practically unknown, except in a few isolated cases. It is claimed to be almost impossible to exercise control over these practices, because of the clever use of advertising which such stores make to mislead the public. With their large mark-ups these houses are said to be able to finance their furniture sales comparatively easily; whereas houses with lower mark-ups accumulate a much smaller volume of book accounts; and to the degree that accounts are inflated by large mark-ups, the “borax” houses are obtaining inflated credit. It is said, however, that recently the banks have been tightening up on loans based on this sort of business.

In some of the larger cities there is considerable competition from warehouse furniture dealers who sell to the retail trade at wholesale prices. Some furniture dealers in New Haven and in lower Connecticut towns within easy reach of New York complain that small dealers carrying a limited stock often send their customers to the manufacturers’ showrooms in New York City, the manufacturer then crediting the mark-up to the particular dealer who sent the customer. The objections were that the customer is led to believe that he can get a larger selection than was possible in his home town, and that the customer is sometimes misled as to the savings in price. The opinion is held that this practice should be eliminated.

Furniture retailers in the larger cities of New England pointed out that they receive a considerable amount of competition from the furniture departments of department stores, especially on the higher grades of furniture and special pieces. Prior to the war there was a feeling that the department stores were getting the bulk of the business of the better type handled by exclusive furniture houses. It is claimed, however, that department stores have lost ground in this respect since the war and that the furniture business now done by the department stores is between 20 and 30 per cent of all high-grade furniture sold, the proportion varying in different cities. The decline in relative importance of department stores in the furniture business is said to be due to their increased cost of doing business. It was found in many instances that when mark-downs and clearance sales were taken into consideration, the gross mark-up varied between 30 and 42 per cent, and many stores were getting a net varying from 7 to 10 per cent.

It was said that customers frequently make comparisons of prices between those obtaining in the first-class furniture store, those offered by an inferior furniture store, and those offered by a mail-order house without considering the basic differences in quality. It is thus a difficult matter to meet competition based only on price, and it is often necessary to demonstrate the contrast in quality by showing the actual specimen to the customer. The general lack of knowledge of furniture construction and values makes it difficult to meet competition on suites or on complete housekeeping outfits featured at a 03330price, such as is often found in the larger cities, and especially in the mill towns.

Although there are four local chain furniture organizations in New England, one having as many as 16 stores, chains as such are not a special source of competition. Competition in this field resolves itself largely into a problem of individual store management. It is claimed that cooperative buying among furniture chains has never worked out very successfully, because of the difficulty of finding different chains of furniture stores operating under similar conditions. Some sections buy types of furniture that other sections would not think of handling. On staple lines, such as kitchen furniture, breakfast sets, ordinary chairs, and the like, chains are able to buy in common and, of course, in so far they have a great advantage, because they can buy on very close terms. Some of the New England chains make a practice of shipping from one store to another goods that do not sell readily.

Credit terms vary considerably with the competitive conditions prevailing in different communities. The old terms of one-third payment in cash and the balance in one year have been pretty generally reduced to an initial payment of 25 or even 20 per cent, the balance to be paid within one year. Under special circumstances quite a few houses take less than the initial payment usually required. Some houses, using high-pressure selling methods, require as little as 10 per cent down, and in some instances do not require any down payment. Practically all furniture sold on credit is sold under a lease. A few of the old houses that have been in business a great number of years sell on open account to their old customers, whose credit has been established. Most houses give a 10 per cent discount for cash. Probably an extreme instance of what was termed “cash” by a customer was a payment of $50 in cash, a check for $150, and the balance in four notes of equal amounts. The notes had the original notation “without interest,” but the customer was finally persuaded to pay the interest.

Several houses have adopted the Morris Plan Bank for financing customer's installment purchases. Under this plan the bank is paid 6 per cent interest per annum, plus 1 per cent commission for its services. Instead of requiring the customer to pay the installments to the bank, however, the payments are made at the store, in order that the store may keep in constant touch with the customer. The expense to the stores under this plan is claimed to average about 5¼ per cent of the sales amount, which is regarded as satisfactory.

One store adopted another plan to eliminate the installment selling evil, called the “cash-credit-check-payment plan.” The plan consists of two parts as described in the following: A “five per cent credit check” is given to customers who pay cash on or before the delivery of the goods purchased, together with a series of gummed credit stickers designed for use on a card. When customers perfer to make a deferred payment, a down payment of 20 per cent is required, and a service charge of 10 per cent is added to the balance, which must be paid in 10 weekly installments. A credit sticker is 03431added to the card upon each payment. The amount outstanding is paid off in 10 weekly installments, and the stickers are accepted as cash for the final payment. This cancels the 10 per cent service charge and permits customers to purchase merchandise on the 10-payment plan at the price which is ordinarily marked on the goods. No stickers are given on overdue payments after the 10-payment period, and customers are notified that “deferred accounts will be collected with interest and legal cost.” The credit checks are given to cash customers at the time of purchase, and are accepted as cash on the next order. They are transferable and are made out in duplicate, the original going to the store's records, while a carbon copy is given to the customer. For the 30-day customer, the 10 per cent service charge is added to the sale price, but is refunded if the bill is paid in full within 30 days.

Custom varies somewhat among stores as to policy in regard to credit terms on goods sold at special sales. Some houses add 7 per cent to the sales price, and others add 10 per cent. On furniture sold by department stores credit terms are in a rather chaotic condition. As a rule, the store tries to get a 20 per cent down payment in cash, although some take as low as 10 per cent. In some cases 5 per cent interest is added to the remaining balance each month, while in others 5 or 6 per cent is added to the installment price, there being different prices on the same furniture for installment and cash business. There is a good deal of competition among department stores in credit matters as regards the dating of bills. Some stores close their monthly accounts on the 28th of the month, so that anything bought thereafter goes on the next month's bill. A few stores antedate their bills as far back as the 20th of the preceding month.

Most of the furniture houses conduct two clearance sales a year, usually in January and August. Some houses conduct one or two secondary sales in addition to their semiannual clearance sales. It is the general opinion that these sales have hurt the furniture business, but not quite so much as some furniture men have reported. It is claimed that periodic sales are a weakness in the business because consumers have been educated to expect and plan for them. It is further felt that these special sales force a higher mark-up in nonsales periods, and that consumers suffer a corresponding disadvantage. As a result of experiment by one of the furniture chains operating in New England, it was found that furniture sales should not be started too early in the season for the reason that people will not buy then.

The best selling seasons in furniture are claimed to be from about the middle of April until the middle of June and again from the middle of October up to Christmas. At Christmas time a considerable business is done in what might be termed novelties and special pieces.

Some furniture houses near summer resorts along the seashore and in the mountains do a profitable business in furniture for summer cottages. In New Bedford, for example, a considerable amount of business is said to be done in the summer resorts along the Cape and with Nantucket and Marthas Vineyard. In one or two instances furniture houses located in the mountain resort regions in the north have built up a profitable business through contact with summer residents. One house, as a result of such contacts, has sent furniture 03532as far West as the Dakotas, and has equipped hotels in Bermuda, besides providing furnishings for archæological expeditions in Egypt. This business is done on a 5 per cent commission basis and is the source of a good income.

One or two high-grade houses in New England have built up quite a profitable business in trade-in furniture. The idea was patterned after a plan used in Los Angeles, Calif. A customer wanting to buy a new dining room or bedroom suite trades in his used suite, with an allowance based on a fair valuation that is satisfactory to the purchaser, which is credited to the new purchase. The furniture traded in is rebuilt and refinished and is then sold in a separate store and in a separate building, usually operating as an annex of the store.

It is quite generally claimed that the “better-homes” idea has done more than anything else to increase the sales of furniture. This idea is carried into the furniture store itself by setting aside certain display space arranged to correspond to the various rooms of a house, and fitted with various types of furniture to show how it would look in home surroundings.

It was pointed out that consumers do not keep up with changes in styles and designs because furniture is purchased at widely separated intervals. Competition among manufacturers for the favor of buyers or buying agents who make selections for retailers is said to be a more important factor in the continual changes in design of furniture than is the taste or preference of consumers.

Furniture men claim that in order to have up-to-date styles it is necessary to carry quite a complete assortment in stock, as well as the standard patterns. On account of the considerable period of time necessary to get goods from the factory, it is necessary to carry two or three suites of a style on hand to meet without delay the current demands of the trade. Furniture manufacturers make up what they call a “cut” of a given pattern, consisting of perhaps 100 or 200 sets, and after such a cut has been exhausted it is a matter of several months before a new cut can be manufactured. The practice of leading manufacturers of maintaining warehouses in the vicinity of Boston is increasing. Stocks are carried in these warehouses to insure prompt deliveries. It is claimed that in many cases a two-day delivery is assured on orders from the Boston warehouses. This relieves dealers of the necessity of carrying the large inventories formerly necessary. With the modern tendency to buy broken suites this presents some difficulties, because the dealer has to make sure that the broken suite can be completed by the manufacturer, and that it has not been discontinued—a situation which is claimed to be frequent.

The depression in some of the mill towns is reported to have brought about a decided demand for cheaper grades of furniture. In communities not seriously affected by industrial conditions, on the other hand, it is claimed that since the war there has been a marked improvement in the quality of furniture sold and offered for sale.

In many instances the manufacturers were said to discontinue certain lines, so that retailers were reluctant to break suites because of the difficulty in replacing pieces. This tends to raise selling costs and keeps down the possible stock turn. Many successful dealers 03633claimed that there was still opportunity to eliminate waste and reduce selling cost by reducing the size of stocks carried, improving the display of furniture, and even extending the chain method of selling it. One of the greatest opportunities suggested for the elimination of waste was reduction by manufacturers of the number of styles they make.

Most of the dealers interviewed claimed that newspaper advertising was their most effective medium. In several cities it was indicated that competition might be more effective if some of the furniture dealers were more aggressive in their newspaper advertising. In the higher grades of furniture some merchants claim great success with direct-mail advertising, featuring the “better-homes” idea, by means of illustrated leaflets and small catalogues sent out from time to time. The point was emphasized that to be successful the illustrations and lithography should be of unusually high character.

Regarding national advertising on the part of furniture manufacturers, it was the opinion of many dealers that while this had undoubtedly built up the total sales of particular manufacturers, a large part of its effectiveness was lost through lack of better cooperation with the furniture dealers. It was pointed out that on seeing a picture of a certain style or make of advertised furniture the customer comes into the store with a rather hazy general idea in mind, and chooses the type or style of furniture that seems most closely to fit this impression, giving the salesman ample leeway to influence the sale one way or another.

Delivery is one of the services that the furniture dealer can not possibly dodge. Some dealers admit that their delivery costs are too high. The average store reported deliveries within a radius from 25 to 50 miles, although on large bills of goods deliveries by the company's own trucks in good weather were reported as far as 150 miles. Even the smaller concerns depend on delivery by truck, and it is reported that deliveries are rarely made by freight.

It is almost impossible for a furniture house to hire or have its trucking done through a cooperative system; for nowadays the housewife demands the service of the store to place the furniture in the house as she wants it, to set up stoves, and to lay rugs and floor coverings. Experienced men are needed to handle furniture, and if care is not used in its handling, losses from damage are considerable. It is pretty generally agreed that poor placing of furniture or poor handling in delivery does more to lose business for a concern than almost anything else.

About 40 or 50 years ago New England was the great furniture manufacturing center of the country. Beginning about 1880 it lost its leadership to the Middle West, on account of the abundance of materials for manufacture and the cheap labor which prevailed there, particularly around Grand Rapids. This furniture leadership is now being crowded to quite an extent by competition from the South, especially North Carolina, where there is an abundance of materials 03734and where the workmen are developing a high grade of skill. The grade of furniture manufactured there is gradually improving from year to year, and a large amount of case goods, particularly in the lower price ranges, is now purchased in the South for sale in New England.

Upholstered furniture, especially the overstuffed type that has become popular in the last few years, is made in numerous local establishments in New England cities. The greater part of this is marketed locally. Aside from this, the principal lines of furniture manufactured in New England at present are chairs, colonial furniture of the higher class, and wicker, rattan, or willow goods. Considerable quantities of colonial furniture marketed in New England come from around Boston and Cambridge, and much of the upholstered furniture comes from Boston.

Considerable quantities of furniture for sale in New England are bought at the furniture shows in Chicago and Grand Rapids, and also on special buying trips to the manufacturers. In northern New England the prevailing way of buying furniture is through the sales representatives of manufacturing houses, who cover the territory thoroughly. A large part of the chairs come from Gardner, Mass., although some dealers claim they have little occasion to buy chairs separately because national manufacturers usually sell complete suites of furniture, including chairs.

Case goods come largely from Grand Rapids,Mich., Jamestown, N. Y., and from centers in Pennsylvania, North Carolina, and Tennessee. Some of this type of goods comes from Island Pond, Vt., Milford, N. H., and other New England sources. New England manufacturers, it is claimed, have made considerable advances in the quality of case goods they are turning out. Dining-room suites are purchased from Leominster, Mass., Milford, N. H., and Portland, Me.

Some idea of the sources of other home furnishings sold in New England may be obtained from the following: A considerable portion of the refrigerators come from Boston and Gloucester, Mass., Nashua, N. H., and Arlington, Vt. Carpets and rugs come largely from New York and Pennsylvania and to some extent from Hartford, Conn., and Worcetser, Mass. Curtains and draperies are bought mainly in New York and Boston. To a considerable extent ranges are bought in Taunton, Mass., and in Bangor and Portland, Me., while some come from Michigan. Bedding comes largely from New England, particularly around Boston, Mass., and Derry, N. H. Mattresses are usually bought locally and, wherever possible, in the city where the dealer is located, in order to avoid the necessity of carrying a large and bulky stock.

The grocery chain is faced with three major problems—local managers, competition, and the rising cost of operation. The right kind of store manager is not easily found, and independent store competition is becoming more formidable. In New England, particularly in the major cities, grocery chain competition is particularly keen and is said to have resulted in a mounting cost of operation. In the larger cities, especially, competition is no longer between the chain and the independent but between the chains themselves. This competition is due largely to the highly concentrated nature of the population, and the accessibility of the various towns by good highways. This makes it possible for a chain organization to operate a number of stores from a centralized point at comparatively low cost, in contrast to some other sections of the country. One of the prime factors that caused the recent combination of four chain systems in Massachusetts was intense interchain competition. Sales per outlet had dropped to the danger mark, while rents and other uncontrollable charges remained fixed.

Grocery chain-store operates point out that their success is predicated upon a few fundamental principles which have been the basis of their merchandising policies. These principles are (a) quality merchandise at a reasonable price; (b) sanitary stores, attractive fixtures, courteous and neat-appearing clerks who know their merchandise, fresh stocks (due to a rapid stock turn); (c) selling the grocery chain to the housewife through advertising; (d) displaying merchandise properly and prominently with price tags; and (e) conveniently located stores.

The following table 13 indicates the number of grocery chain outlets in New England as of the year 1925.

Note.—Population per store based on 1920 census.

The total number of grocery chain outlets in the United States in 1925 was 24,857, so that New England, with approximately 6.9 per cent of the population of the country, had about 9.7 per cent of the chain outlets of the country. The total chain-store sales of grocery products in 1925 were, in round numbers, $330,000,000. New England chain-store sales represented about 7.8 per cent of the total. From another study, made in 1926, it was shown that 33 New England cities, exclusive of Boston, Providence, Springfield, Worcester, and Portland, representing approximately 22 per cent of the population of New England, had almost 40 per cent of the grocery chain stores.14 Over 46 per cent of these chain outlets were the stores of one large national chain system, while the remainder belonged to eight different local New England organizations.

In Boston, Hartford, and Springfield the grocery chains were said to sell 60 per cent of the total groceries; in Worcester, Lynn, and New Bedford the chains were said to do 50 per cent of the business; in Lowell and Providence, 45 per cent; in Fall River, 40 per cent; and in New Haven, 35 per cent of the total grocery business. Boston, Cambridge, Somerville, Springfield, Providence, Portland, Bridgeport, Waterbury, and Pawtucket are warehouse points for the larger grocery chains, while Fitcburg, Worcester, Lawrence, Hartford, and Pittsfield are warehouse points for the smaller chains.

Grocery chain operators claim that there is a distinct difference in their trade in industrial centers during depressions, the volume of trade varying inversely with industrial prosperity. When depressions are greatest, the chain-store business increases, while when conditions improve there is a tendency for the housewife to carry a credit account with the independent grocery. When industrial conditions are bad and credits tend to mount, the independent grocer cuts down on credits, and this tends to turn customers to the chain stores.

Grocery chains have not been generally successful in distinctly foreign localities, such as French and Italian neighborhoods, largely because of their presence for dealing with their own nationality and their tendency to make very small individual purchases.

It is also claimed by one large national grocery chain that there is a considerable difference in the amounts of various items sold in different sections of the country. For example, candy sales are said to vary from 1½ to 3 per cent of this chain's sales in Boston, in comparison with one-half of 1 per cent for the country as a whole. The 04138sale of fresh fruits in New England is said to average around 6 per cent, in comparison with 11 per cent for the whole country.

There were only 28 self-service chain stores in New England in 1926. This type of store has been slow to develop in industrial communities, because their appeal is based largely on quick service rather than on price.

Trucks carrying groceries, known as “mototerias,” have only recently made their appearance in New England. These trucks carry a large number of grocery items necessary to the housewife. In case the “mototeria” runs short, it is supplied by rush delivery with a light truck. Daily average sales are said to be $500 per “mototeria” and, in some instances, as high as $800. One company is operating in the better suburban localities of metropolitan Boston, where two-family houses prevail. A worth-while route is considered as one having about 500 families within a 2-mile radius, accessible over fairly well-paved streets.

The drug chains has not developed as rapidly as the grocery and other types of chains, largely because the initial investment of capital per unit is much larger, and the operation of a drug unit is much more difficult and complex than the grocery unit. There is only one large drug chain operating in New England. This chain has its headquarters in Massachusetts and is the largest drug chain in the country to-day. Almost 47 per cent of the 173 drug chain outlets in New England are located in the six largest cities, and 34 per cent are located in the city of Boston alone. Drug chain development so far is confined to the larger cities, and has not yet reached the smaller towns.

From a merchandising standpoint the chain drug outlet competes with independent stores in the specialty lines which they carry. Its competition has been on the increase through the addition, in some cases, of books, radios, and other department-store items. It is claimed that, roughly, two-thirds of the items sold by the large drug chain operating in New England may be classed as merchandise adaptable to residential shopping and drug requisites, and about one-third of the items as convenience goods for transients, such as soda-fountain items, candy, cigars, cigarettes, and pipes. This chain also maintains unusually complete food departments in its stores, carrying such items as tinned coffee and tea, fruit sirups, preserves, babies’ food, malted milks, vanilla and lemon extracts, beef cubes, olive oil, salad dressings, peanut butter, marmalades, jams, cocoa, and grape juice.

This New England drug chain, like all other chains, uses leaders to stimulate sales. Unlike some other chains, it does not retail its specials or sales leaders at cost, but retains a very small profit. This chain is also makes a feature of “1-cent sales.”

Shoe chains have grown quite rapidly in the past three or four years. There are some 55 chain shoe stores located in New England,15 representing about 9 per cent of the total of this type in the country.15 Source: Chain Store Research Bureau (1927).04239There are approximately 794 chain shoe stores, representing about 12 per cent of the total number of shoe stores in the country. Practically all the shoe chains are confined to the large cities, attempting to locate in shopping centers. Some shoe chains are extending the variety of stock carried by adding lines of stockings and knit goods. Private brands are of particular importance in the chain shoe outlets, about one-half of them carrying their own brands, while in the rest private brands represent from two-thirds to three-fourths of their stock. Shoe chains, particularly those carrying the lower priced lines, do not do much advertising. Window displays are relied upon for the most part, and where other advertising is used the local manager, in many instances, is allowed to exercise his own judgment. Problems of stock keeping have been greatly simplified by eliminating the number of styles and by establishing a single price, and hence their total store inventories tend to be much smaller than in unit stores.

One of the greatest problems in shoe retailing in recent years has been to fit the stock of sizes to the market. Half of the failures in the retail shoe business are said to be due to odd sizes remaining unsold. One New England chain meets his problem by shifting unsold stock from one store to another until it is sold; while another chain accomplishes the same object by holding weekly or periodical sales.

Stock turns are said to be far too low, and many chain operators claim to look for intense competition in the next few years. Salaries and rents are the two chief items of expense, and some operators claimed that salaries in many instances were higher than the business would warrant.

New England has approximately 92 chain cigar outlets and a number of tobacco agencies in the smaller towns. Despite their strong grip upon sales of tobacco in metropolitan centers, cigar chains are encountering competition from department stores and from chain grocery outlets. Cigar chains have added, in recent, years, quite a side line of merchandise, including candy, clocks, watches, shaving accessories, writing paper, fountain pens, pencils, wallets, key rings, playing cards, poker chips, and a number of other articles; candy is becoming more and more important.

New England has one of the three largest lunch-room chains in the country. There are also both local and national chains operating restaurants, as well as a local chain of cafeterias. A chain of 8 laundries and a chain of 40 photographic studios are operating in Massachusetts. There are also chains operating hotels and theaters, as well as specialized chain stores selling candy, men's clothing, hosiery, waists, knit goods, and automobile accessories; and in addition to these the chain has appeared in a number of other lines.

The correctness of the basic principles of chain-store operation has been demonstrated by its general acceptance in all the highly populated trade centers. At the best it is difficult to keep track of the opening of new units and the application of the chain principle to new lines of merchandising.

It is impossible to explain the growth and success of chain-store merchandising by any inclusive theory that applies equally to all 04340kinds of chains. The remark has been aptly made that every chain is a law unto itself. A skilled central office management controlling the activities of numerous retail outlets represents the crux of the chain-store principle. although each type of business and each individual company in the business represents a separate and unique problem, certain elements are common to all chain-store success. The principal factors in their success are attractive store arrangement, well-organized merchandise displays, carefully chosen locations, and stocks of standardized goods selected to secure the most rapid stock turn.

On garments such as dresses, coats, and furs, approximately one-third of the persons replying to the questionnaires stated that they buy these items in stores outside their local towns, as is shown for the different marketing areas in the following table.

In some of the smaller towns of western Massachusetts, Vermont New Hampshire, and Maine, as many as half of the replies indicated that these items were bought outside their local towns. On the whole, as may be seen from the table below, there were relatively few cases where these items were purchased through mail-order houses. In the smaller towns in the New Haven, Burlington, St. 05552Johnsbury, and Bangor areas, however, there was a distinct increase in the proportion. New York mail-order houses seemed to dominate in the towns of the New Haven area, while Chicago houses as well as New York houses, were indicated in the areas of the three northern States.

In regard to shoes the table shows that a little over 70 per cent of the replies indicated principal purchases from local stores, while the proportion buying shoes by mail order was negligible. In the towns around Worcester, Springfield, and Providence the proportion of consumers purchasing shoes out of town was considerably higher, in some instances amounting to approximately one-third of those replying. Many indicated that shoes for ordinary wear were purchased locally, while stores in the larger centers were relied upon for shoes of the fancy type and for dress wear.

As indicated in the next table, 77 per cent of all consumers replying stated that they bought their hats principally in local stores. There was some variation among the different areas. For example, in the 05653Providence area 86 per cent of the replies indicated that hats were purchased in local stores; in Burlington, the proportion was 90 per cent; while in the Worcester area only 67 per cent of the replies indicated that hats were purchased in local stores, and the remainder of 33 per cent were purchased in out-of-town stores.

Only in very rare instances did women report buying hats by mail order. Many replies indicated that less money was spent for each hat but that there was an increase in the number of hats purchased. Many stated that with the great variety in styles the first essential was to get a hat which was becoming and which matched a particular frock or garment; and for these purchases local stores were, for the most part, quite satisfactory.

The table below shows that 80 per cent of the total number replying indicated the purchase of underwear principally in local stores; 17 per cent purchased in out-of-town stores, and 3 per cent from mail-order houses. The table indicates that in the purchase of corsets there was very little variation from these figures. There were considerable variations, however, among the various trading areas. For example, 68 per cent of the replies from the Springfield area indicated that underwear was purchased in local stores, while in the Burlington area the proportion was 92 per cent.

About one-fourth of the replies indicated that scarfs were purchased mainly in out-of-town stores, while out-of-town purchases of artificial flowers and inexpensive jewelry were indicated by about 20 per cent. In the purchase of hand bags, 29 per cent of the total stated they depended mainly on out-of-town stores. As may be seen from the table, there is considerable variation among the various areas.

It was clearly indicated that the novelty element entered into the purchase of these items, and that the time and place of buying were determined largely by passing fancy. In the purchase of artificial flowers for wear, mail-order houses played little or no part, and only to a limited degree in the purchase of inexpensive jewelry. In the rural areas of central and western Massachusetts and throughout northern New England the tendency was apparent to buy these novelty items in the larger centers, principally because local stores carried very limited stocks and lagged too far behind the general trend of styles. In other words, in such items styles must be had immediately to be of value and service to the consumer. It is largely for this reason that to-day the jewelry departments of department stores are getting a large share of the novelty jewelry business.

A considerable variation is shown in the purchase of children's ready-to-wear clothing. Replies from towns in the Boston, Hartford, New Haven, Portland, Bangor, and Burlington areas indicated a range from 71 to 88 per cent in the proportion of consumers buying in local stores. Replies from towns in the Worcester, Springfield, and Providence areas indicated that in almost 40 per cent of the cases, children's clothing was purchased out of town.

Much has been said about the passing of the piece-goods business from the small-town store to the city store, because of better assortments, larger displays, and the attraction of buying in the larger community. Replies to the questionnaires show that about 76 per cent of the consumers bought piece goods for adult clothing mainly in local stores, and approximately 20 per cent in out-of-town stores, while in 4 per cent of the cases such purchases were made mainly through mail-order houses. About 82 per cent of the replies stated that purchases of yard goods for children's clothing were made in local stores, and only 16 per cent in out-of-town stores, while only 2 per cent of the total number indicated mail-order houses as sources of supply.

A greater tendency to purchase piece goods out of town, both for adults and for children, was indicated in the Worcester, Springfield, and Providence areas than in the other trading areas. In the mill towns having large foreign populations, particularly of French Canadians, merchants claim that the sales of piece goods in contrast to ready-to-wear clothing was quite noticeable. There was also said to be a tendency for women to buy in more exact quantities than they formerly did, often buying in fractions of yards rather than in even-yard units. Many replies to the questionnaires indicated that evening gowns and street apparel were largely purchased ready-made, while dresses for house wear and for informal occasions were made up from purchased piece goods.

The replies as to the place of purchase of furniture, rugs, and draperies were not quite as satisfactory as the others, inasmuch as many of those replying had not purchased either class of items for a considerable period of time. Indications were that about 40 per cent of those buying furniture and rugs made their principal purchases out of town. The returns indicated that a much higher percentage purchased draperies and curtains at local stores. This was largely because many persons were buying the materials and making their own curtains and draperies. Among the smaller places the tendency to shop out of town appeared to increase with the size of the town and with the income. This can probably be explained by the limited number of good furniture stores in small towns, and by the fact that where people with small incomes are forced to purchase on the installment plan, one account is more satisfactory than several at various stores. Consumers usually seem to be desirous of obtaining furnishings that harmonize with the homes, the two essentials being appearance and comfort. In the mill towns much of the success of the furniture business has been attained by fitting a home of four or five rooms for a certain established price.

Such items as stockings, kitchen ware, vacuum cleaners, washing machines, brushes, brooms, mops, and electrical appliances, besides having outlets through local stores and mail-order houses, are sold to a considerable extent from door to door. The table shows that of the total number of replies, 72 per cent indicated the major purchase of stockings in local stores, and about 8 per cent from door-to-door salesmen, while about 16 per cent purchased their stockings from out-of-town stores, and only 4 per cent from mail-order houses.

Considerable variations are to be noted in the replies from different areas. For example, 27 per cent of the 2,000 replies from towns in the Providence area indicated that their purchases of stockings were made in out-of-town stores, and 14 per cent made these purchases from door-to-door salesmen. For towns in the Springfield area 21 per cent of the 580 replies indicated the purchases of stockings out of town, 8 per cent from mail-order houses and 4 per cent from door-to-door salesmen. Of the 395 replies from the towns in the Worcester area, 22 per cent stated that purchases of stockings were made from out-of-town stores, 8 per cent from door-to-door salesmen, and 3 per cent from mail-order houses.

In kitchen ware the table shows that over 90 per cent of the persons replying purchased these goods in local stores, while a small number made some purchases from door-to-door salesmen.

In purchases of vacuum cleaners the general average from door-to-door salesmen for all areas was about 10 per cent; but in the towns of the Boston, Worcester, and Springfield areas about 12 per cent bought from house-to-house salesmen. Purchases from mail-order houses were indicated by only a little over 1 per cent of the replies, and in one or two areas by 2 per cent. Only 8 per cent indicated purchases from out-of-town stores.

Brushes, brooms, and mops lead the list in the proportion of purchases from door-to-door salesmen. For all the areas approximately 25 per cent indicated buying these items from door-to-door salesmen. In some of the areas, such as Portland, Bangor, Hartford, and Providence, 35 per cent of the replies stated that these items were purchased from door-to-door salesmen.

On electrical appliances about 91 per cent of the replies indicated the purchase of these items at local stores. This may be easily accounted for by the fact that the local public-service electric companies are quite large distributors of such appliances, in addition to the electrical specialty stores and hardware stores handling electrical goods. People ordinarily like to have a store that is readily accessible to care for needed adjustments of mechanism. Of the total number of replies, about 6 per cent indicated that electrical goods were purchased from out-of-town stores, 2 per cent from mail-order houses, and only 1 per cent from door-to-door salesmen.

The third question asked for the principal reasons for trading out of town. In the following table the proportion of persons stating one or more of seven reasons is expressed as a percentage of the total number of replies for each of the trading areas. It is noted that the most frequent reason for shopping out of town was the greater variety in stocks of merchandise and better styles were stated as a reason by the next largest group. In the order of number of replies received, the existence of larger stores was the third reason for trading out of town; from comments received in connection with the answer to this question, larger stores and a greater variety of merchandise undoubtedly were closely related, and in many instances the two were unconsciously associated in the mind of the shopper. Approximately 14 per cent of the total number of replies indicated price as the principal reason for trading out of town. Thus price did not play the important rôle that one would ordinarily expect; and this seems to lend point to the contentions of the more successful merchants interviewed, that in many communities merchants were not merchandising up to their greatest possibilities. Theaters and attractions accounted for almost as many replies as price, while better quality of merchandise trailed the entire list of reasons excepting store service, with approximately 8 per cent of the total. The fact that quality as a reason for shopping out of town is overshadowed by several other reasons gives weight to the contentions of merchants 06259that the average woman looks for style first and regards quality as a relatively secondary consideration.

The largest proportion of objections to local stores was in regard to the lack of style goods carried. This varied considerably in the different areas. The chief objections seemed to be that there was a lack of variety in dresses and ready-to-wear clothing. It was also said that coat and dress styles were late in appearing, in comparison with Boston and some of the other large centers. Quite a few claimed that it was difficult to get narrow widths in better grades of footwear. In many instances it was claimed also that the better lines did not seem to be carried, especially in such goods as real fur, real lace, and expensive clothing.

It was generally reported that prices in local stores compared favorably with the prices of merchandise in other cities. The comparisons that were made indicated considerable price variations within certain lines of merchandise. In two or three cities there were a number of complaints of store having a two-price policy. It was clearly indicated that this practice induced women to shop out of town because they did not like to haggle over prices; and even if the price was satisfactory, there was a strong feeling in the mind of the customer that she had not received the most favorable price and consequently that she had made a poor bargain.

Objections to the selection of stocks and their lack of freshness of appearance came next as a reason for dissatisfaction with local stores. Most of these objections were centered on the usual phrase, “We are just out of it,” with the same condition continuing for several weeks following. These objections, for the most part, applied to dry goods stores. In some sections it was said that the same goods were often displayed for too long a period, and that often the stock was dusty and soiled. One comment quite frequently encountered was that it was difficult to get the latest novelties.

Clerks generally were commended for their courtesy and efficiency and only occasionally were they complained of as displaying a certain lack of willingness to show merchandise regardless of whether a sale was made or not.

Complaints against misleading advertising were few and constituted only about 5 per cent of the total number of specific criticisms of local stores. The great majority of replies indicated that the sincerity and the intent of the advertising was not questioned. Practically all the persons replying indicated that they read the advertisements in the papers and followed them closely. A point often referred to was that the large stores advertised liberally, while the smaller stores failed to do so, and many women were frank to say that this influenced them in favor of the larger stores and that the smaller stores in this respect lost business. Probably one of the most pertinent things pointed out was the tendency of stores in the smaller towns to concentrate advertising on Saturdays, the opinion being that there would probably be substantial gains for other trading days if the advertising were distributed to attract business in the earlier part of the week. A few 06461indicated that there was too much sameness in copy of stores handling similar types of goods, and that a considerable gain might be made in inducing people to trade at the local stores if the advantages were brought to their attention more often and more forcibly.

While specific comments about store arrangement and display of stocks were made by only about 5 per cent of those who showed dissatisfaction with local stores, these comments are illuminating. Most of the replies stated that window displays for spring and fall openings were attractive, but to a lesser degree than Christmas displays, and that at other times displays were only fair. It was pointed out that window dressing could generally be improved by using fewer articles in the windows. In the rural sections emphasis was laid on the desirability of having window displays priced.

Many women stated that the most attractive feature of any window was the air of refinement that it carried. Akin to this remark was the oft-occurring comment that in some of the stock arrangements dignity is not maintained. Another general comment was to the effect that store lighting could be greatly improved. A few smaller towns, several of them near the larger centers, have succeeded to a very high degree in improving their window dressing and the general appearance and atmosphere of their stores.

The indication from a special study carried on by nine of the largest department stores and specialty shops in Boston, said to be one of the first and most complete studies of its kind, are that stores are far too lenient in the return of merchandise. During two 4-week periods in 1926, extending from April 7 to May 3, and from May 5 to May 31, there were 58,170 separate returns of merchandise of a total retail value of approximately $722,000. Returns took place in only 11 departments common to each of the nine stores, representing women's and misses’ dresses, coats, suits, sweaters, millinery, and shoes, infants’ wear and juniors’ and girls’ departments.

According to this report, “customers’ reasons” caused from 70 to 75 per cent of the returns. In almost 85 per cent of the cases the return was indicated as due to “change of mind” or “no reason given.” Where no reason was given it is probable that in many instances there was no logical reason for the return, while in a certain number of these cases undoubtedly there was no explicit response because the customer was not questioned directly through fear of arousing resentment. “Wrong size ordered” accounted for most of the rest of the merchandise returns for customers’ reasons. “Family does not like” caused less than 2 per cent of the returns in any store.

In the returns made for merchandise reason which were 22 per cent of the whole, “wrong size’ played a leading rôle. Next were the reasons “sold on approval” and “wrong color”. The returns on account of some error in size amounted to approximately 18 per cent of the total number of returns; if the number of reasons under the categories “no reason given” and “change of mind” be eliminated, errors in size accounted for nearly 50 per cent of the remaining returns.

The conclusions brought out in this report are that responsibility for a large part of the returns of merchandise rests, indirectly at least, upon the customer. The majority of the returns are made because of change of mind by the customers or for reasons not stated, rather than because of fault in the merchandise or service. The number of returns made because of mistakes in size indicates that sales people should take greater care in selling merchandise, and that customers should exercise more care in ordering proper sizes. As regards the time taken to return merchandise, about 55 per cent of the returns were made within three calendar days from the date of sale, and 78 per cent within six calender days. The report states that here it was impossible to determine from the data whether the customer or the store service was at fault.

Very little merchandise sold on installment was returned. In most stores 60 to 80 per cent of the returned merchandise had been sold on a charge basis, 25 to 30 per cent for cash and 1dcl001; to 2 per cent C. O. D. Unsatisfactory deliveries were responsible for only a negligible proportion of returns.

The element of price was the dominant consideration among reasons for dealing with chain food stores; about 77 per cent of all those patronizing chain stores gave price as the dominant motive. Only 10 per cent of the total number of replies gave quality of goods as a reason for dealing with chain stores, and the element of convenience accounted for 8 per cent. The proportion of the particular reasons was fairly uniform throughout the various areas.

Considerable variation as to the type of goods purchased was shown in the replies of persons who traded with chain food stores. About 30 per cent indicated that they purchased all their canned goods from chain food stores; 29 per cent purchased all their package goods, and 17 per cent indicated the purchase of dairy products, such as milk, butter, eggs, and cheese, from chain stores. Many of the replies suggested that more trading would be done at chain stores if fresh fruits and vegetables were carried. In many cases the housewife has had to depend upon independent stores for fresh vegetables and fruits; for it is only recently that the chain stores have begun to carry fresh fruits and vegetables to any extent. The tendency seems to be, especially in the larger centers, for chain stores to increase the amount and variety of fresh fruit and vegetables carried, and, in some instances, to create separate departments within the store to handle those items.

As to comparisons of prices in chain stores and independent unit stores, 94 per cent of the replies stated that, on the whole, chain prices were lower; 5 per cent said they were the same in both types of stores; and a little less than 1 per cent of the replies stated that chain food store prices were higher.

As to the quality of goods handled, 79 per cent of the replies maintained that the quality was the same in the two types of stores; 8 per cent stated that the quality of the goods in the chain stores was better; and 13 per cent maintained that in chain stores the quality of goods was inferior.

As to comparison of weight, 87 per cent said that weights of packages and contents were the same in the two types of stores; 12 per cent were of the opinion that the weight of packages tended to be less in chain stores; and 10 per cent stated that weights in chain stores tended to be fuller than those in independent stores. The replies, as a whole, indicated that in the majority of instances the consumer is not very observant as to the net content of packages and, for the most part, packages and containers are accepted with little or no question. On the question of service, excluding the elements of delivery and credit and restricting service solely to that rendered within the store, 78 per cent of the replies stated that store service was the same in the two types of stores; 12 per cent claimed that the service of chain stores was inferior to that offered by unit stores; and 10 per cent said that the service in chain stores was better than that of unit stores. Of the two most frequent complaints against the service of chain stores, one was the length of time required to be waited upon, owing to crowded stores and the insufficiency of clerks to handle the trade at peak periods. The other comment most often made was the large number of mistakes in totaling up the 06966amount of large orders. This probably arises, not from a deliberate intention to short change, but from the usual method of placing the items in a bag or container and footing the separate amounts rapidly on the bag with pencil. The two comments most frequently offered regarding the independent store was lack of neat arrangement of stock, absence of price tags on goods, and a tendency to be careless in statements about the freshness of goods in orders given over the telephone.

In the nine centers in New England the study showed that families with incomes under $900 a year spent, on the average, 44 per cent of the income for food; those from $900 to $1,200 spent 43.8 per cent; while those with incomes from $1,200 to $1,500 spent 42.5 per cent, with a constant decrease to those with incomes from $2,100 to $2,500 a year, who spent 39.3 per cent of the family income for food. For families with incomes over $2,500 per year there is a slight increase, 40.3 per cent of the family income being spent for food.

In the nine New England cities studied families having incomes under $900 a year spent 12.8 per cent for clothing; and those with incomes from $900 to $1,200 spent 14.6 per cent of their income for clothing. This proportion increases progressively up to 21.8 per cent of the total income in families with an income of over $2,500 a year.

Families with incomes under $900 a year spent 15.9 per cent of the family income for rent; those with incomes from $900 to $1,200 spent 13.7 per cent, while those with incomes from $1,500 to $1,800 spent 12.2 per cent of the family income for rent. The percentage decreases progressively until those with incomes over $2,500 a year spent only 8.5 per cent of the family income for rent. It is to be borne in mind, however, that rent, to a greater extent than most other items of expense, is influenced by local conditions. Likewise the expenditure for fuel and light is, to a considerable extent, a local matter.

Families with incomes under $900 spent 7.6 per cent of their income for fuel and light. The proportion decreases progressively as the yearly family income increases, being only 4.2 per cent in families with incomes of $2,500 and over.

Families with incomes under $900 and those with incomes from $900 to $1,200 spent 3.7 per cent for furniture and furnishings; those with incomes from $1,500 to $1,800 spent 4.3 per cent; and those with incomes from $1,800 to $2,100 spent 4.2 per cent for these articles. In families with incomes from $2,100 to $2,500 a year there is a marked increase, 5.9 per cent of the family income being spent for furniture and furnishings; while those with incomes over $2,500 a year showed a decrease to 4.5 per cent. Here, again, it is to be borne in mind that some variation is to be expected, inasmuch as expenditures for furniture and furnishings are not of a frequent sort, and the returns are influenced by the recentness with which these families may have been in the market to buy such items.

The proportion of the family income spent for miscellaneous goods and services in one year was found to increase progressively from 16 per cent in families with incomes under $900 a year, up to 20.7 per cent of the family income for those over $1,500 a year.

The expenditures for miscellaneous purposes represent a surplus above the family requirements for shelter, food, and clothing, and embrace a great number of items, such as amusements, vacations, streetcar, fares, contributions, dues, telephone, automobile expensed, and items classed as general advancement, such as newspapers, magazines, and expenditures for educational purposes. The New England States, for the purpose of general classification of all families, were grouped by the United States Department of Labor, with the North Atlantic States.

From this study it is apparent that not until an income of $1,800 is reached is there a surplus of $4 a week to spend, and not until the income reaches $2,500 and over is there a surplus of $10 a week. In other words, figuring on the basis of 50 working weeks to the year, the family income must be between $35 and $50 a week before there is much of a margin for expenditures above the necessities of life. It is to be borne in mind that these budget studies were made in the year 1919, which reflected high prices and other economic phenomena due to war conditions. The preponderance of evidence from field interviews and from the customers’ questionnaires indicated, however, that there is not much out-of-town shopping until the weekly income surpasses the $35 mark.