Evening Star Newspaper, May 5, 1929, Page 14

THE SUND AY STAR. WASHINGTON, N. C. MAY . 1929—PART T. KLEIN AND FESS SPEAKERS ON STAR R! HIT TRADE WASTE Radio Speakers Cite Need for Unification of Commer- | cial and Industrial Effort. (Continued From First Page.) investigations that may justly be ~alled | ‘arge scale ‘clinics’ for distribution nilments, “The Department of Commerce now has under way a broad-gauge study of credit conditions and _problems throughout the Nation—a tremendously vital factor in our present-day system of distribution, especially as to install- ment selling and credit extension. “In every problem it's a case of get- ing the facts. Following is the t TIlein’s address I deeply appreciate the opportun:ty »florded me by The Washington Evening . {tar and the Columbia Broadcasting | ‘FY Of Commerce. vstem to speak in this Radio Forum | behalf of the Department of Com-|each community, its marketing methods merce. I am only sorry—and I know fand all factors affecting trading with- at you shate my regret—that Sccre- |in the region. They chow just how iary Lamont has been regrettably un- | people buy and when and why. These cble on account of illness to speak io|studies promise to be invaluable to You on this sublect from the wide | traders of every class. | ange of his business experience. Atk 1 would like to discuss with you what Survey Proves Value. | perhaps the gravest aspect of the| Then there are a number of investi- ation’s Lusiness, namely, the urgent |gations that may justly be called large- weed for revitalizing the entire system | scale “clinics” for distribution ailments. rf merchandise distribution in (ne|Such has been the Louisville grocery | United States. | survey in the Kentuci tropolis— | "This problem is intimately related to!a truly remarkable survey carried out tha welfare of every one of us. Jis|in _splendid collaboration between | olution involves directly the betcer- | public-spirited Louisville business men Jaent of every family budget in tne!and this department. We have dete ountry. By establishing greater «fi-mined how much it costs to sell gro- | cioncy and economy in the conduct of | ceries, analyzed the eccentrictities of | omestic trade, we are making your | us consumers, the reasons why grocers ar buy more. This, I think you |fail—and succeed. Evcly one of us 10 "agree. is decidedly worth while. | Who buys groceries has a direct interest The high American standard of | in those questions. This has been de- *ving gives you your radios, your motor | scribed as the first comprehensive in- | s, your comfortables. your recrea- |Quiry ever attempted as to actual| n% and amusements. And what is the | Wholesaler-retailer-consumer relations— | . ~omomic groundwork of that living!an effort to get to the bottom of the | \ndard? It has two corner stones. | Plight of the retailer. e Cthese it high wages for those | The results of this survey have al- Oreate the Nation's wealth, The ready proved of indisputable value. So| ris low prices for consumers. | much so, indeed, that the drug trade | 5 | of St. Louis, Mo., is making overtures | Buying Power Up. | for assistance in a similar survey to i of Dr. Julius metr The broader the spread between the | o the more solid is the pyramid of « ir economic well-being. This unprec- -iented prosperity of ours is explain-| ;e largely by the fact that wh:\ll ¢ onomists call the “real wage'—that | . buying power—has been increasing : ‘ice 1922 at the rate of two and one- \th per cent a year, whereas in that 1e wholesale prices have been falling | the rate of one-tenth of one per cent, year. But from 1896 to 1913 real -ges increased only at the rate of half of one per cent a year, whescas lesale prices were increasing two one-third per cent a year. Thore| 1 have in one small packet of statis- 5 the nub of the whoe story of our roressive advance six\cel the war. . ~Zour real wages, of course, 2 - asured by the amount of goods inat + money in your pay envelope will To achieve national progress, in material sense, we must make the ~lar buy more merchandise. ‘That cessitates lower prices. And how can es be lowerea? Obviously, by Ie- cing the cost of (1) making the ds and (2) bringing them to you. “n reducing the cost of making them, duction eficiency can still accom- Zh much, buC we cannot expect the ance along that line to be as rapid dramatic henceforth, as it has “n in the past half-cent: ‘Waste Exceeds $8,00 5 Tn what direction shall we turn, then, .“order to reduce retail prices? We -st spread the line of attack by nting enemies that have received en- -y too little attention in the past. n the opinion of trained observers -4 economists, there is not less than w0 10 billion dollars of waste in the, nduct of American business every Ar in both directions—exports and -ports—ad nthere is ample reason » belive that the highest single per- . atage of this waste arises in the field ribution. Tslh‘:tt is, I am convinced, the greatest se now before the industrial and mmercial community of the country. 1= efforts of our busines machinery to : ke headway with the present combi- " -tion of scientific mass-production, on -+ one hand, and our haphazard, anti- -ated distribution, on the other, is > a giant capacity truck trying to de- er its load of up-to-date, efciently sduced commodities by creeping along 2 highway of commerce under the wer of a “one-lung” motor of the tage of 1905. The“eeonomles and laboriously achiev- 1 savings represented in the load are gely eaten up by the flagrant, waste- 1 futility of the distributive power. distribution is “motion applied to 1 aterials” (as it has been defined by -~ distinguished authority), then cer- nly much needs to be done before . can rightfully claim to be attaining satisfactory degree of profitable | « ~ration. Waste Has Many Phases. Precisely where, we may ask, do these | stes occure, and what are their: uses? They arise from such things | ‘excessive expenditures in sales, pro- | ~entive effort without adequate infor-| ;-~tion a8 to prospects in a given| ~rket, unwise credit methods, unfair actices of small trading minority, -ufficlent data as to national stocks < goods, disorderly marketing, partic- -rly of perishables, with resulting ©“qts and famines, careless and inju- ~jous procedure in the retail trade. “arge sums are needlessly consumed unsystematic warehousing, in ex- vagant delivery services, in ill-judged vertising, in unwise installment thods. Great wastes exist also in the phys- -1 movement of merchandise—in oking, handling and transportation. r instance, it has been found that »ds can be handled much more eco- mically through the use of “skid itforms”"—a device which assembles zes or other containers on a movable ard or base. This is utilized in con- action with trucks or cranes and | cs away with the need for handling -n individual package separately. ect savings through the use of such aple devices range from 25 per cent s as high as 90. It looks as if, with ndardization and interchangeability, might save ultimately anywhere m 200 to 500 million dollars a year thus simplifying handling. And that merely one phase of physical distri- tion. Bankruptey Courts Clogged. We must determine the reason why + bankruptey courts are clogged with - tragic wrecks of retailers. In one -dium-sized Middle Western city grocery stores fail every month, in- \ving heavy losses, many of which| uld be prevented, if a watchful eye 4 been kept on some of these prevent- Jle distribution wastes which I have ~ntioned. : The fundamental American philoso- v of lowering prices so as to increase nsumption, of mass turnover lndI nimum margin of profit—those prin- >les which have been so conspicuous | the success of many of our industrial 1dertakings—can be applied with equal ~ect to distribution. But such ap- cation is possible only if our distrib-} 1 ors are prepared to match our pro- icers in the scrutiny of details and « the complete efficiency of their re- ~ctive processes. One major effort of the Department Commerce to curtail distribution ~sses is through trade surveys of com- sercial areas of the country. Two of ‘ese surveys have been completed— overing, respectively, the six South- cover that metropolis. H Now, of course, increasing the avail- | able statistics will not necessarily save | incompetence. There will always be | rapid-stock-turnover enthusiasts, con- | temptuous of stern realities, who insist | on selling a certain article at a cent or | two below cost, but who say they can | afford it because they sell so much of it. There are equally brilliant storekeep- | ers who occasionally discontinue some | very fast-selling line because “they can | never keep a stock of it on their shelves.” | But in general it is the lack of facts that | is the real trouble. The rule-of-thumb, hit-or-miss method in distribution is the | germ in this disease. Its elimination | will certainly lower mortality rates among retailers, They are beginning to | learn the imperative necessity of stock | control and accurate cost accounts, of | scientific studies of store location, mar- | ket analysis, etc. Surveying Credit Conditions. The Department of Commerce now | has under way a broad-gauge study of | credit conditions and problems through- | out the Nation, a tremendously vital | factor in our present-day system of dis- | tribution, especially as to installment | selling and credit extension. Surpris- ingly helpful replies are now coming in from many of the 300,000 firms collab- orating in this study under the joint | auspices of the National Retail Credit | Men's Association and the Department of Commerce. In order to provide a fund of basic data as to market possibilities, there have been planned a series of hand | books to ford a basis for locating | branches and warehouses, planning mar- keting and advertising activities, to | show the competition in the different districts, the sources of income and the buying power. These practical aids to better business, the first of which, cov- ering New England, has just appeared, | combine information in such a manner | that the market potentialities of any area or combination of areas may be evaluated readily. In co-operation with the Baltimore group of controllers, representing 18 large stores, a study is being made of | the grave and vexatious problem of re- turned goods. You will be interested | to know that the lines which suffer | most from this embarrassing “refusal- to-stay-sold”—if I may call it that— are furniture, carpets, Oriental rugs and women'’s ready-to-wear clothing, in that order. | Avoidable return of merchandise s | a very costly practice for which all of us pay, whether offenders or inno- | cents. We need the facts as to why goods are returned, and what if any- | thing is to be done about it. | Next year it is planned to take a | Nation-wide disiribution census in con- | nection with the decennial census of | population. This should show just | what happens to goods between the | time they leave the factory and the | time they reach the consumer. It will enable business men to know the total sales of the different types of merchan- | dise, and the various types of stores through which they are handled. It will tell us how and where sales are | made, in what volume and the sell- | ing methods that are followed. | Waste Is Big Problem. | If you are planning to open a cigar | store, let us say, you ought to know how many competing stores there are in your town, and it will surprise you to find out that this involves not simply a count of other cigar stores, but, according to recent surveys, it re- veals that 17 other types of shops, ranging from hardware stores to music establishments, also sell cigars. A would-be’ book store owner can make an intelligent decision as to | where he should set up his business only after he has canvassed the data | i to be available in this census as to | the precise methods and extent of that business. The intended retailer should | of all things beware of just such hid- | den or unexpected competition from stores with lower operating costs, car- | rying as a side line the commodity which he will perhaps make his spe- cialty. The Government will shortly reduce the amount of paper in the dollar bill, | but we can increase the power in that remaining fragment by prosecuting | vigorously this movement to rout out economic wastes, especially in slipshod | selling, and remember that they are wastes which concern all of us, since | we are all consumers. As such, it be- | hooves us to view this problem in its effect upon us, not simply its bearing on store keepers. ‘The job of being a distributor, and particularly a retailer, doesn't mean | simply an ability to take telephone | orders and wrap up packages. It in- | volves an application of our well tried | efficiency in production to the vast field of distribution. We must make some headway against that appalling 8 to 10 billion dollar waste. This can be. perhaps, the greatest move toward enhancing the happiness, comfort and aspirations of our people. Unification Held Necessary. Declaring that the average citizen does not realize the strength of Gov- FOR RENT Downtown stores on F street; rent ranging from $175.00 to $250.00 per month. --estern States and the New England . tates. Others are in progress. They analyze the buying power of Address Box 5.V, Star Office EOPRL W W, W 0 R 438 4 4 R Left to rigth: Senator Fess of Ohio and Dr. Julius Klein, Assistant Secre- ar Staff Photo. ernment _ownership sentiment in the Nation, Senator Fess s the only ai- ternative in sight is unification of rail- road systems, “by which a line woak as an independent may become a sou of profit as a fecder of a general system.” The problem of railroad un he said, “is to_reduce from mai fow systems. Steam transportation to- ay is owned by nearly 2.000 companies nd s operated by nearly 1.000 sepa- te organizations. The probl reduce them to 20 an average that would consolidate the more than 250,000 miles of road into ems of around 10.000 miles each ‘The unification proposal upon the principle of concentration and control. Concentration is the order of modern industry. It is in the interest of increased efficiency and sound cconomy. ~ Control is necessary in the public interest, which is the real test of all legislation.” Senator Fess outlined provisions of a bill he introduced for consolidation, now pending. He stated that whatever else may be urged as argument for the unification of roads “the primary or conclusive argument cning of the weak lines, first, to insure transportation; sccondly, to avoid Government ‘owner- ship.” The text of Senator Fess' speech fol- lows: more _adequate ‘The commercial progress of the Na- tion has been phenomenal. One of the chief agencies of that growth is trans- portation, including steam, water, high- way and aerial. Steam transportation has advanced to the point where we now have the most efficient service in | Water transportation will | the world. receive more and more attention. High- way traffic is increasing by leaps and bounds, and air navigation is the new- est and will take a wide range in the near future. I will speak only tonight of steam transportation, with refer- ence to the one outstanding problem. ‘The problem of railroad unification is | to reduce from many to a few systems. | Steam transportation today is owned | by nearly 2,000 companies and is op- erated by nearly 1,000 separate organ- | izations. 'The problein is to reduce them to, say, 20 systems. On an aver- age that would consolidate the more than 250,000 miles of road into systems of around 10,000 miles each. The unification proposal is based upon the principle of concentration and control. Concentration is the or- der of modern industry. It is in the| interest of increased efficiency and sound economy. Control is necessary is based | the strength- | in the public interest, whioh is the real | test of all legislation. This principle was recognized in the act of 1920, but little progress has been made since that date. In accordance with the mandate of the law requiring a complete plan of unification, such a plan was submitted by Prof. Ripley of Harvard, which was not accepted by the Interstate Commerce Commission. Later the commission submitted tentatively its own plan, but finally recommended to Congress the repeal of this mandate as an impracticable requirement. However, the commission is again work- ing upon such a plan, but as yet has not reached a final decision. Recommendation is also made (1) for- jidding any unification without the pproval of the Interstate Commerce ‘ommission; (2) power to reject unifi- ~tion unless specific line or lines are rcluded; and (3) some other minor nanges. Amendments to the present law to facilitate unification have been urged the commission, and also by Presi- dents Harding, Coolidge and Hoover. I introduced a bill in the last Con-| oress, and the committee on interstate commerce reported it, to facilitate uni- fication. It 1s supported by the Amer- ican Railway Association, representing the Class A roads: by the Short Line Association, representing Class B and C roads; by the Industrial Traffic League, representing the shipping public; and by economists and students of transpor- tation, In the hearings on the bill no one appeared in opposition to the pro- posal. The touchstone of this proposal is the public interest. Legislation to be justified must meet this test. While it should respect the rights of the owner | in profitable investment, and rights of labor in a proper standard of wage. it must also respect the rights of the pub- lic in adequate service. which. aiter all, is the final test of all legislation. 1In the public interest, unification must retain necessary competition. It must avoid any undue lessening of competition Competition in the surest guarantee of adequafe pub- lic interest. while absence of competis tion is tha certain abandonment of ade- auate service. Unification on these lines will insure economy in operation The larger system can make better use of its equipment. It will permit more direct routing of cars, and less back- hauling of freight. It will make avail- able direct lines for fast freight. It will reduce the cost of switching. It | will insure standardization of methods and equipment. maximum utilization of <hops and equipment, and concentra- | tion of purchasing agencies. Unification will doubtless insure bet- ter service by strengthening credit facilities. which will permit additions and betterments in equipment and roadbeds. | in operation would be to abandon th: | looks to public utilities, such as commu- | and radio. | especially hydro-clectric, as within their | | arate systems, would be unprofitable. such as in the working out of mines, the | cutting off of the forest, etc., or the| failure may be due to bad management. | Whatever be the cause of the failure of | these roads, they supply a service for | the community built up by the roads. | To abandon these roads because of loss | people of the community. Independent operation at a loss cannot continue in- definitely. If the alternative is pre- sented to either abandon the roads o operate them by the Government, the latter will be the controlling alternative These roads, under such a situation, are sufficient in number and influsnce to dominate sentiment for Government ownership. If it is once entered upon to cover these weak roads, the next step will be the inclusion of the strong roads. The average American citizen does not realize the strength of Government | ownership sentiment in the country. It | is heard in the halls of Congress as well | as in the forums of public opinion. It 1 | | nication agencies—telegraph, telephon The advocates of Govern- | ment ownership scan power development, | field, and are by no means excluding | transportation as a_public function h\'; There can be litt!: | the Government. doubt of what will be done in case no way is found to preserve these roads h cannot _continue as independent lines The only alternative in sight for Government ownership is unification. | by which a line weak as independent | may become a source of profit as a feeder of a general system. A great system s due to its feeders, cach of | which may serve as a profit to the | system, while it could not exist slnnc.i One system made up of 100 branches, taken together, may be profitable, which, if operating as a hundred sep- | | In the other way around, we may have » region served by 100 separate and un- profitable roads, which, if consolidated ment and equipment, might quite profit- ably insure a better public service. It is | on that basis that the principle of uni- fication_has been and is now being | urged. It at once enlisted and stimu- | lated the support of all classes who look ! on Government ownership as unwise. | and will provoke the opposition of those who view the policy of Govern- | ment_ownership as the better plan of | operation. H The strong urgency for unification to | | include all lines, on the one hand, and | the hesitancy of systems to include | | roads obviously weak, on the other, has | | created sentiment for compulsory uni- fication. The pending bill is not com- | pulsory, but voluntary. However, it does give authority to the Interstate Com- | merce Commission to deny the unifica- | WALSH IS SEEKING DATA ON PAPERS Montanan Would Have List Submitted Showing | All Owners. | | By the Associated Press. ‘} A resolution was introduced yester- | day by Senator Walsh, Democrat, of Montana, asking the Postmaster Gen- | eral to submit to the Senate the names | of all owners, managers and security holders of the newspapers in which the International Paper & Power Co. has an interest. The resolution is an_outgrowth of testimony before the Pederal Trade Commission which disclosed that the paper and power company held stock or securities in i1 newspapers in vari- qus parts ot the country. | Immediate action on the_ resolution | was _deferred by Senator Watson of Indiana, the Republican leader. who | informed the Montana Senator that he | desired to examine the proposal. The resolution would ask for the names and addresses of the editors, managing edi- | tors, publishers, business managers, own- ers, stockholders, mortgagees and other security holders of the papers con- cerned. i The information desired is in the hands of the Postmaster General by virtue of an act passed in 1912 requir- | ing newspapers to file a list of owners | with the Government. Senator Walsh D iion eystem with @unifcdimanide=i = - DUIbo o GENiSuEesOIuEoE SRns) | | (4) by the purchase of the securities of other roaas. The hope of the proponents of this relief legislation is to insure an ade- | quate transportation system operated by private enterprise under proper regula- tion in the interest of the public. | 1t will be a definite announcement of a_transportation policy which will en- able freedom in management to pro- | ceed in improvements and betterments demanded by a rapidly growing local ity, which will in time unlock resources | and insure still greater prosperity to all | our people. | a1d to find out whether this act needed any amendmoent. The Montana Senator was asked by Senator Watson whether he contem- plated an_“investigation of any sort.” Walsh replied that he had “no idea of any at this time.” The newspapers named in the Walsh resolution were the Boston, Mass., Her- and Traveler; the Chicago Daily News, the Chicago Journal: the Tampa, Fla., Tribune; the Greensboro, N. C., Record; the Albany. N. Y. Knicker- bocker Press; the Albany, N. Y., Eve- ning News: the Brooklyn Eagle. the Augusta. Ga.. Chronicle; the Columbia, S. C. Record. and the Spartansburg. . C., Herald-Journal. STRIKE IS AVERTED. New York Workers are Granted Pay Increase. NEW YORK, May 4 (#).—A threat- ened strike af 150,000 workers in the building trades was averted by an agree- ment signed this afternoon between the executive committees of the Building Trades Council and the Building Trades Employers’ Association, whereby the workers were granted a five day weck and a 10 per cent increase in pay. The agrecment goes ifito effect August 24. Nearly 900,000 people attended the recent carnival at Manila, P. I See For Are_your eyes worth so little cheap glasses?, s long before you are Many People GEORGETOWN MAN IS VICTIM OF GAS Robert M. Petty, Found in Bed | by Brother, Still Unconscious at Hospital. Robert M. Petty, 52, of 3331 O street member of a prominent Georgetown family, was still unconscious at Emer- | gency Hospital late last night after be- | ing found overcome by gas in a bed on the second floor of his home yesterday | afternoon. Mr. Petty, the son of James Thomas Petty, 92, former District auditor, who | died Friday, was discovered by his | brother, Dr."willlam K. Petty of 1627 Nineteenth street, shortly ~after 2 o'clock. The Emergency Hospital ambulance and the auxiliary car of No. 2 rescuc squad_ were summoned. Under the direction of Sergt. Edward Carroll, the rescue squad partially re- vived N . Petty after working over him with a rospirator for about 30 minute He was then removed to Emergenc: Hospital. | High food prices in Italy are arous- ing complaints among the masses. Yourself that you can afford to wear any A competent optometrist can read the danger signals aware of Eyestrain. Need Glasses That Can Be Bought as Low as Examination This Dr.D.L.Rose With I M. Jacobson & Son. Optometrist Optician Week 929 G St. N.W. Est. 50 Yrs. We Prescribe GLASSES—AND MAKE Them and, | tion unless the proposed system includes | A great system will be in a ‘su(‘h roads as the commission deems | position to make direct and fast ship- | s, 10 s ly the demand for cars | \(x:l‘e:;::clacl’ z}‘é‘l‘.’ Ay :l\'e Tegular and | necessary. The bill provides four meth- more adequate and satisfactory service | 0ds of unification: (1) Where it is ac- | by each system connecting with an- | complished by one system taking over other system. Such a plan will permit | the physical properties of one or more the operation of solid trains to and | Other systems; (2) Where a corporate from large centers with a maximum | merger is permitted by one or more use of terminals. It would insure uni- | Systems merging into the corporate con- form service throughout the year. Tt |trol of an existing system: (3) where would also lessen and simplify. the |a consolidation is effected by an entire problems _of regulation. It is obvious | new corporation created to absorb other that the Interstate Commerce Commis- | systems which lose their existence, and | sion, mow dealing with nearly 2,000 |- = = = comnanies, with their varied com- | plaints, would be greatly relieved if these could be reduced to a score or | | more of systems. 1 Whatever else may be urged as argu- | ment for the unification of roads, the | primary or conclusive agrument is the | strengthening of the weak lines, first, nsure more adequate transportatio and, secondly, to avold Government ownership. I fully agree with the late Senator Cummins that we have the al- ternative of preserving the weak lincs through unification, or the adoption of Government ownership of transporta- tion. There are many railroad companies WATCH AND CLOCK REPAIRIN ClocKs Called For - Deivered - Guranteed e MANTEL 7\ AR GRANDFATHER it G CLOCKS totaling thousands of miles of roa which have ceased to be profitable, either through lack of equipment, or traffic, by the exhaustion of sources, LANSBURGH & BRO 7th, 8th and E Sts.—FAMOUS FOR QUALITY SINCE 1860- ‘Franklin 7400 Tomorrow---Last Day Our Annual Bigger-Than-the- Washington-Monument Sale of Men’s SHIRTS Collar Attached—Collar to Match and Neckband Styles $1.39 The final opportunity to choose from so varied an assortment of patterns— white shirts of such outstanding su- periority at the one low price of $1.39. After tomorrow you'll wait another year before A Bigger-Than-the-Wash- ington-Monument Shirt Sale. 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