REDUCTION IN PROFIT MARGINS OF FOOTWEAR RETAILERS

Gisborne Herald, Volume LXXVI, Issue 23022, 12 August 1949, Page 5

REDUCTION IN PROFIT MARGINS OF FOOTWEAR RETAILERS

(P.A.) WELLINGTON, Aug. 11. The Price Tribunal announced that a discussion between the price control division and the New Zealand Retailers’ Federation on the reduction of profit margins on the retail footwear trade has been completed. Wage increases granted footwear operatives have been passed into the manufactured price and in accordance with the tribunal policy, the division had discussed with footwear _ retailers the question whether those increased costs could be absorbed wholly or in part by retail distributors so that a final consumer price would be held as firmly as possible. A flat reduction of two and a-half per cent, on retail profit margins has been agreed to by the federation. This reduction, by one-sixteenth in previous margins, was sufficient to offset approximately one-half of the increased costs allowed manufacturers. As it had not been possible for the retail trade to absorb completely manufacturers’ increases there might be small increases for locally-made shoes, but in no case would the increase be greater than two and a-half per cent. In respect of imported footwear, however. there would be further price decreases. as reductions in profit margins by one-sixteenth applied in respect of both imported and locally-made footwear.

The tribunal has instructed that a further review of retail margins be undertaken when the financial accounts for the 1948-49 trading year are available, added the statement.