PROFIT MARGIN.

Auckland Star, Volume LXVIII, Issue 100, 29 April 1937, Page 10

PROFIT MARGIN.

"IMPOSSIBLE" PLAN.

COMMENT BY RETAILERS.

QUESTION OF WASTE.

A retailer expressed the opinion that to suggest that lie could conduct his business on 33 1-3 per cent profit was absurd. There was too much waste, and, again, prices varied from day to dav.

"I have bought peas at sixpence in the marts one day, and the following day bought again at twopence. The same thing happens jvith other vegetables and fruits. How am I going to get a 33 1-3 per cent profit on the peas I paid sixpence for, and the same profit on those I paid twopence for?" He said there was so much waste at times that retailers had to vary their prices, and it would be impossible to work on a flat rate of profit. In any case 33 1-3 per cent, lie considered was not sufficient.

"Until I have seen the complete report I would not care to venture any opinion," said another retailer, "but I noticed thai;-the committee recommends the setting hp of a consultative committee, and one of its personnel is to be a representative of the Wellington Fruit and Vegetable Retailers' Association. Half of the population of Xew Zealand is served with fruit f-oin the port of Auckland. This is recognised by the Government in allowing 40 per cent of the oranges imported to be allocated to Auckland, and yet the Auckland Retailers' Association is not to be represented."

A further retailer said that as far as he was concerned he would be satisfied with the fixing of the profit margin at 33 1-3 per cent, as his last balance-sheet worked out at less than $50 per cent profit gross. He pointed out that there was a great deal of loss in the trade. A case of bananas was bought at say and if he sold the lot he got 30/. That did not allow for the paper bags or cartage costs. He had paid as high as 4£d each for grape fruit, and had had to retail them at sd.

Another city retailer said that he would need fuller information before expressing definite opinions, but there was no doubt that there were too many in the retail fruit trade in Auckland. One trouble 'was the mixed shops, which, in addition to fruit, stocked other commodities, and often fruit Was sold when the fruit retailers were compelled to be closed. They were able to serve people whom they knew, and therefore the practice was very hard to stop. If the number of fruiterers was limited it would enable people in the business to make a better living than they could get at the present time. There' was also the competition of barrow-men who were not faced with rents and taxations like the shopkeepers. ~ A suburban fruit retailer said that it remained to be seen how the profits proposed would be regulated,-' but if anything were done to control the trade the Government only could do it. He also pointed put the effect of waste. Fivepence each .might be paid for mangoes, and if they did not sell they were a dead loss. Some of the fruit was more perishable than other kinds, strawberries being a 'case in point. Often, on their handling | there heavy Usually a fruit j jietaileil- had stock thafcwould not keep, I and he ; 'was in a different category from ' a grocer or other business man. 'He | thought that a 33 1-3 per cent margin onj fruit was ridiculous. The prices of fruit fluctuated rapidly and sometimes practically from hour to hour. He said that he had bought bananas in Auckland at 25/ a case and within an hour bought more bananas of the same quality at 15/ a case. In such a case, how could the profit be regulated T Often he could go to a gardener and buy produce cheaper than in an'auction mart. He agreed that there was far too much competition at the moment, and if anything could be done to put the fruit retailing business I on a definitely better footing much good would be achieved.