1955: Retail Business | As they saw it

During the last quarter of 1954 and the first three quarters of 1955, retail sales were considerably above those of the previous twelve months. This trend, however, seems to have leveled off during the third quarter of 1955. The increase averaged approximately 7 per cent; it was more pronounced in the durable goods field, averaging about 15 or 16 per cent over the previous twelve-month period, while in non-durable goods the average was about 4 or 5 per cent. Sales of department stores were up somewhat more than the average.

The inventories of retail stores increased during 1955 in terms of dollars. Their increase did not keep pace with the growth in sales, however, so that stock-sales ratios declined somewhat. This was characteristic of both durable and nondurable goods.

Discount Houses.

The discount house continued to be a subject of active interest during 1955. Although the growth of this type of outlet was perhaps not so rapid as it had been during previous years, there was an increasing tendency to look upon it not as a temporary phenomenon in the retailing business but as a result of underlying economic forces inherent in the competitive system which are bound to manifest themselves more or less continuously.

The problem of the discount house is a part of the whole problem of retail prices and their control. The effectiveness of fair trade laws became increasingly doubtful during 1955, and there has been a definite trend away from the practice of control of resale prices at retail by manufacturers especially when exercised through the medium of such statutes. The courts of seven states have now held that price-fixing contracts cannot legally be enforced against non-signing retailers. There has also been a disposition on the part of the courts to refuse to enforce such contracts unless the manufacturer involved has made a reasonably energetic effort to police all members of the retail trade. Since such policing effort is apt to be very expensive, this judicial attitude serves to discourage manufacturers who formerly followed the practice of occasionally bringing suit against a few large, conspicuous, price-cutting retailers, meanwhile winking at innumerable small outlets which had also violated the law.

Price Enforcement.

During 1955 General Electric and Westinghouse announced abandonment of the attempt to enforce maintenance of retail prices on large value items, and Westinghouse also abandoned the attempt on small value articles.

By their maintenance of a high production rate in the face of faltering consumer demand, together with the quota system which they apply to their dealers, the automobile companies have forced considerable departures from their established retail prices. The dealers have accomplished such reductions through various devices, most of them designed to disguise the fact that prices have been cut.

It is obvious that the enforcement of resale price maintenance by both legal and commercial means had broken down to a large extent during 1955.

Supermarkets.

During 1955 supermarkets continued to increase in size and to expand somewhat the scope of the merchandise they carried. However, this process of diversification has been materially slowed down, and there are indications that the constant extension of the articles handled by these outlets is not without its drawbacks.

Suburban Trading Centers.

The trend toward suburban trading centers continued. This tendency is still confined chiefly to the periphery of the larger centers of population, although there are a few examples of such developments near smaller cities.

Coupons.

There has been considerable discussion within the trade of the desirability of the use of coupons or trading stamps as a marketing device. One large food store chain has taken a very strong position in opposition to their use. Many supermarket operators view them dimly, feeling that price reductions which are out in the open and easy for consumers to see are a much more potent means of increasing the volume of sales than a device which is indirect and will not be taken advantage of by a considerable percentage of their customers.

Source: http://astheysawit.com/5689-1955-retail-business.html?utm_source=rss&utm_medium=rss&utm_campaign=1955-retail-business

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