ALLEGED PROFITEERING.

New Zealand Herald, Volume LVII, Issue 17429, 26 March 1920, Page 6

A LLEGED PROFITEERING.

CHARGE AGAINST GSJO.CER.

SALE OF A PATENT FOOD.

EVIDENCE AS TO PROFITS. [BY TELEGRAPH.PRESS ASSOCIATION.] WELLINGTON.' Thursday. The, first case under the new Board of Trade Act came before Mr. Page, S.M., to-dayy .when Bertie Smith, grocer, was charged that on January 20 he sold Mrs. Hazel Edith Carroll, of Auckland, two bottles of Mellin's food at a price unreasonably high, namely, 3s 6d per bottle. Mr. PrendevilTe, Crown Law Officer, outlining - the case for the prosecution, said the defendant advertised himself as a food specialist, and professed to sell at cut rate prices. He was a cash grocer, and not faced with thefrlikelihood of certain losses and expenses often incurred by ordinary family grocers., On January 30 Mrs. Carroll called at his shop, asked for two bottles of Mellin's food, and tendered ss, but a servant of the defendant said the price was 3s 6d a bottle. She expostulated, but as it was essential for her to have the food, she paid the price demanded. Later she made a report to the Board of Trade, which ascertained that Smith had purchased .his stock at 25a 6d a dozen less 2£ per cent. The ptice charged at other shops was '2s 9d. Smith's profit on the line was 40.8 per cent., while other grocers ware satisfied with* 24.65, which, counsel contended, showed Smith, was making more than a fair-profit. Defendant stated in evidence that his profit on the sale of the* line in question was 22.6 per cent. Most grocers aimed to make 25 -to 30 per cent, on the turnover. Consequent upon breakages, etc., Mellins food cost 30 per cent, to handle compared with just over 11 .per cent, for the rest of his stock.

James Mcintosh, accountant, said an examination of the defendant's books showed that the profit on the whole of his business was low—too low to cover the contingent risks of a grocery business. Records for a period of about 6£ months up to June 6 last showed that the net profit—on a turn-over of £12;817 at the Courtenay Place shop—amounted only to about 2s per £100. The net profit on the Berhampore and Courtenay Place businesses combined was 2.04 per cent, on £21,000 odd. That was also too* low a rate of profit. The average usually aimed at in similar businesses was 25 per cent, gross and 5 per cent. net. The defendant's profit on the sale of Mellin's food worked out at 32.11 per cent., which was not an unreasonable profit for a special hue. The gross and net profits on the Berhampore business were 18 and 10 per cent, respectively. The defendant recalled said that Mcintosh advised him to increase his prices, but he had increased prices onlv -where prices to him were increased. This had no effect on his profits, v ¥"* closed the case,' and after counsel had addressed the Court His Worship reserved his decision.

THE WELLINGTON TRIBUNAL.

MANY COMPLAINTS RECEIVED.* [BT TELKGBAPH.—OWN COKBESPONDENT.I

WELLINGTON. Thursday. The Wellington tribunal under the Board of Trade Act met again yesterday and considered various cases of alleged profiteering. Mr. J. P. Luke, M.P., the chairman, stated to-night that preliminary inquiries were still being made. Some information confirming complaints of over, charging had been before the tribunal, but it was too early to say what action would be taken.

The complaints received are covering a wide variety of businesses. * They range from wheat to honey pots, from coal to sugar, and it is evident that the tribunal is going to have an enormous mass of work on its hands in making the necessary investigations.