14 



BULLETIN 394, U. S. DEPARTMENT OP AGRICULTURE. 



by the table — a fact which man}' merchants overlook. The most suc- 

 cessful stores confine their purchases to a few reliable firms, rather 

 than scatter their orders among too many wholesale houses. In fact, 

 one store on the verge of bankruptcy ascribed its failure in large part 

 to this practice, since, in time of difficulty, it could claim but little 

 support from its numerous creditors. Among the many objections 

 to scattered buying are : (1) Greatly increased and useless office work ; 

 (2) divided support of the wholesalers; (3) excessive buying and 

 danger of overexpansion ; (4) too great diversity of stock; and (5) 

 loss of advertising opportunity afforded by standard lines. 



Table IV. — Practice in purchasing. 



Question. 



No. re- 

 porting. 



1k)W. 



High. 



Aver- 

 age. 



Yes. 



No. 



Largely from salesman .' 











43 

 19 

 24 

 27 





From catalogue houses 











21 



From manufacturers 











19 



Are lowest pr ices obtained 











11 



Produce from farmers 



22 



SI, 500 



S35,000 



$12,126 





All orders reduced to writing 



10 

 39 



30 



Invoices checked S3'stematically 











2 





- 











It is interesting to note that only 27 stores believed that the.y 

 bought at the lowest price, while 11 said positively that they bought 

 at a disadvantage. The reasons given were: (1) Inability to take 

 advantage of discounts, .and (2) in a few cases, discrimination on 

 the part of wholesale houses against the cooperative store. The 

 former handicap is to be traced generally to such causes as insuffi- 

 cient original capital, tying up of capital in accounts receivable, over- 

 investment in slow-moving or dead stock, loss, of capital through 

 bad management, etc. On the latter point a few stores asserted that 

 they were sometimes discriminated against in the prices they were 

 compelled to pay; that they were not given equal credit privileges 

 with private and corporate enterprises; and that they were refused 

 certain lines of goods at any price. Credit men say that this obtains 

 only when the store has unsatisfactory credit rating or record and 

 when cut prices and discounts are allowed on fixed-price goods. 



SELLING. 



As shown in Tables V and X, the annual sales of the stores under 

 consideration ranged from $7,500 to $623,703, with an average ap- 

 proximating $88,000. Table X includes only 35 out of the 60 stores 

 visited during the survey, and it will be noticed that of these 5 were 

 imable to give sufficiently complete data for a statistical estimate 

 of their financial success. 



