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manufacturers or wholesalers by mail. As competition sharpened, and the travelling salesmen of some firms began to make more frequent visits, once a month or once every three weeks, it became necessary for their competitors to follow, until finally, in certain localities, it had become customary for travelling salesmen to visit the retailers as often as every two weeks. The retailers themselves, having become accustomed to these frequent visits, grew gradually into the habit of reserving orders to give to the salesmen instead of sending them by mail, and the enormous expense of selling thus brought about increased largely the cost of the goods to the retailer and consumer. It must not be overlooked that from the viewpoint of economic society such efforts are mere wasted energy, a dead loss in efficiency if the results can be less expensively accomplished by other methods. It is probable, however, that the vigorous struggle for competitive profit in this case pushed new and at times useful goods on the market.

The amount of loss coming from this often misdirected energy can, of course, be merely a matter of conjecture in most cases. Mr. Edson Bradley, VicePresident of the Distilling Company of America, and President of the American Spirits Manufacturing Company, estimated, in his testimony before the United States Industrial Commission, that, in the sale of alcoholic liquors in this country, somewhere between the distiller and the consumer at least $40,000,000 a year were lost. He thought that this was lost primarily in the attempt to secure trade, and that the result was simply a higher price to the consumer. Part of this waste comes from the wages paid to travelling salesmen and from their travelling expenses; and by lessening these items alone his combination saved $1,000,000 a year.

A striking bit of testimony from an opponent of the combination was given before the Industrial Commission by Mr. P. E. Dowe, President of the Commercial Travelers' National League in which he asserted in 1899) that more than 35,000 salesmen had been thrown out of work by the organization of trusts and about 25,000 reduced in salary. He sums up: “$114,000,000 represent the annual expenditure cut off by the direct influence of the trusts.

The cost of advertising in papers and magazines, by show windows, "landscape decorations,” and other means, adds greatly to the cost of putting goods into the hands of the consumer. The price of a single full page insertion in such a magazine as the Century or Harper's is at least from two to three hundred dollars, in Cosmopolitan, two thousand dollars, or in the Saturday Evening Post, from five to seven thousand dollars; yet every one knows that it is scarcely possible to open any of the popular magazines in any civilized country without seeing on one of the best advertising pages some smiling face with the inquiry, “Have you used Pears' soap?” Other soap manufacturers fill other pages with advertisements no less attractive or expensive, and the amount thus spent in competitive advertising must clearly cost millions of dollars per year.

Some firms push the sales of their wares largely through the offering of prizes of various kinds. For $10 one may secure a box of soap, which at the retail price would cost $10, and in addition may receive a rocking-chair, a bedstead, a writing desk, a lamp, a baby carriage, or other article to suit the buyer's needs, of which the retail price would also be $10. It is true that instead of the prize one may take more soap, but the prize was, originally at least, the attractive feature. A manufacturer of spices advertised that for $37.50 a customer might receive spices of which the retail price would be $37.50, and in addition a premium of a forty-dollar clock. For $25 might be secured twentyfive dollars' worth of spices, and a twenty-nine-dollar Waltham watch, with many other similar offers. In all these cases, not merely was the quality of the goods advertised of the best, but the premiums were also of standard makes, whose value could not be questioned.

It should not be forgotten that all this advertising does not increase proportionately the amount of soap or spices consumed to advantage. If it did, the advertising could scarcely be considered an economic loss. The purpose of the advertising is not chiefly to persuade customers to buy more soap or spices, but to use Pears' instead of Colgate's, or Ivory soap instead of Babbitt's, or one favorite brand of spices instead of another. Such expense of advertising must, of course, add greatly to the cost of the goods to the consumer. It is probably not too much to say that in many lines it would be possible, if the competitive advertising were rendered unnecessary, to furnish as good quality of goods to the consumers, permit them to pick their brands, and charge them only one-half the prices paid at present, while still leaving to the manufacturer a profit no less great than that now received. The men now employed in the work of advertising might well put their efforts to better use in the service of the consumers. High as is the artistic quality of some of the advertising, its educative effect would doubtless be reached in other ways at less cost. .

The dissolution of the American Tobacco Company by decree of the Supreme Court of the United States did not result in lowering the price of tobacco. An important effect was the prompt expenditure of millions of dollars in advertising and selling new brands that had to be made popular by the separated companies in order that each might have an adequate line of goods.

2. The anxiety to make sales in time of sharp competition leads also, in many cases, to extension of credits beyond a wise limit, and the manufacturer, fearing to lose a customer, will often fail to exercise due diligence in the collection of debts owed him. A large combination, having control of a large proportion of its class of goods in the market, can readily avoid these difficulties, and Trust magnates testify that their losses from bad debts have been very greatly lessened through combination.

Mr. Chas. R. Flint, referring to the United States Rubber Co., said that in 1900 it lost less than $1,000 by bad debts out of a business of about $25,000,000, whereas he thought the loss from that source by separate companies on a business of that volume would have averaged more than $100,000 a year.

3. Whenever competitive business is carried on through many establishments, each working on a small scale, and particularly when the industry is one in which many qualities of goods of a somewhat similar nature are manufactured, the buyer is often put to considerable expense in going from one manufacturer to another in order to secure the variety of qualities which will satisfy his needs. A large establishment which carries substantially all the leading qualities in stock, and which can thus supply the demands of any customer without trouble to himself beyond the presentation of his order, will readily secure trade which would otherwise be lost. This ease in securing orders is often a great source of saving to a combination and is rarely found in a single manufacturing establishment, however large. The Distilling Company of America found it advisable to purchase several of the leading brands of rye whiskeys in order that customers might supply themselves not only with alcohol, spirits, and standard grades of corn whiskeys, but also, without leaving the establishment, with a sufficient number of the finer brands of rye whiskeys, so that all their needs in these directions would be met.

4. A similar advantage comes from keeping a stock so large that the largest order can be filled at once. It has been estimated by some conversant with the sugar business that the American Sugar Refining Company, on account of its ability to supply any customer with all the sugar that he can require at any time, is able frequently to secure one-sixteenth of a cent more per pound than some of its competitors, they being compelled to go one-sixteenth below the regular market price in order to effect a sale.

These last two advantages apply, of course, to department stores and in some degree to any large establishment, but they strengthen the tendency toward

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