36 
BULLETIN 1442, U. S. DEPARTMENT OF AGRICULTURE 
group, when total expense percentage was considered. Gross margin 
percentage did not present the same degree of regularity of decrease 
as the salary and wage percentage, but the tendency was evident. 
Table 13. — Gross margin, total expense, total wages, expenses other than wages 
and profit or loss according to average annual sales per employee in 129 
individual retail meat markets, 1923 
[Amounts expressed as percentages of net sales] 
Average annual sales per employee 
Number 
of stores 
Gross 
margin 
Total 
expense ' 
Salaries 
and 
wages 
Expenses 
other 
than 
salaries 
and 
wages 
Profit 2 
Less than $8,000 
8 
13 
17 
30 
21 
10 
3 
24.04 
25.25 
25.88 
23.46 
23. 62 
22.23 
21.39 
18.76 
24.29 
25.29 
22.26 
20.32 
19.79 
16.60 
15.58 
14.10 
13.48 
12. 41 
7.69 
9.71 
8.16 
-0.25 
38,000-$9,999._- 
-.04 
$10,000-$11,999..„ 
3.62 
$12,000-$13,999-„ 
6. 84 | 3. 14 
$14,000-$1 5,999 
7.38 i 3.83 
$16,000-$17,999 
18.51 1 11.90 
17.45 11.19 
1'.'. 82 ! 8.24 
6.61 3.72 
$18,000-$19,999 . 
6.26 3.94 
Over $20,000. 
a 58 ! 3. 94 
1 Interest on investment not included as an expense 
2 A minus (— ) sign indicates a loss. 
Stores in the first and second groups in which annual sales per 
employee were below $10,000 showed losses. In the remaining] 
groups, the percentage of profit was fairly constant, ranging be- 
tween 3.14 per cent and 3.94 per cent despite the general decrease 
in gross margin percentage previously mentioned. A corresponding 
decrease in total expense percentage resulted in the maintenance of 
a fairly constant rate of profit. 
In Figure 3, the data of Table 13 are presented in graphic form. 
The total length of each bar represents total expense percentage. 
The downward trend of the total expense and salary and wage 
percentage as annual sales per employee increase is plainly demon- 
strated. It is an obvious conclusion that increased efficiency in 
the utilization of employees' time in retail meat establishments should 
materially reduce wage expense. Since wage expense constituted 
about two-thirds of total expense, any reduction in wage expense 
should be strongly reflected in total expense. In conformity with 
this viewpoint, a definite downward trend in the wage and total 
expense percentages was found to be present as annual sales per 
employee increased. (Fig. 3.) The relation between annual sales 
per employee and total expense was thus shown to be high. 
The group of 53 unlimited-delivery stores in which the sales 
volumes ranged between $14,000 and $100,000 yearly was selected 
as a representative group for further study of the relation of utiliza- 
tion of employees' time to annual sales per employee and total ex- 
pense. It was found in this group that the correlation between 
annual sales per employee and total expense percentage for this 
group of stores was —6.75, where —1 represented perfect inverse 
correlation of these two factors and where indicated no agreement 
whatever. 
There was thus indicated a definite, inverse relation, that is, as 
the average annual sales per employee were increased, decrease in 
