BUSINESS IN THE CITY

New Zealand Herald, Volume LXX, Issue 21469, 18 April 1933, Page 5

BUSINESS IN THE CITY

A DIFFICULT YEAR ' ] NORMAL TRADE AFFECTED BRIGHT EASTER PERIOD Business in the city has been carried 011 under very trying conditions during the past three months, and wholesale and retail traders have been thankful 3 for the short Easter respite. The year ; so far has proved a very difficult one for all sections of trade. < The normal course of business has been subject to several interruptions < during the year These have served to further intensify troubles duo to the decline in the value of the country's ; exports and the restriction in public i spending power. When traders had more or less adjusted their activities to : tbeso conditions, the rise in the exchange rato provided a further disturbing element, and this was followed by the imposition of the sales tax, meaning additional work for no greater return. When trading was resumed after the Christmas holiday period, wholesale distributing houses experienced a rush of town and country orders required for replenishing stocks. Retailers had not bought heavily prior to the vacation, and stocks were extremely light. Good clearances were made, and for the time being little interest was shown in overseas markets. Overseas business opened quietly and buyers were inclined to operate sparingly and deal in small lots only. A stock-taking period occupied the attention of merchants fop some time during January, and steady conditions prevailed, with tho indent market quiot. The Rise in Exchange Tho announcement of tho exchange increaso toward tho end of January was a sharp jolt to the trading community of the city. Higher landed costs necessitated tho revision of price lists of many open lines, but for a time normal requirements were allowed to retailors at current prices. An immediate result was seen in merchants' overseas commitments, which were roduced to those deemed absolutely essential. Revised price-lists were put into effect in February. Imported goods showed a substantial increase, while the higher cost of landing raw materials was reflected in higher prices for locally-manufactured goods. From the importer's point of view, the exchange had the effect of turning attention to cheaper grades to keep the price to the public within reason. Interesfc in luxury and semi-luxury lines languished somewhat. The policy of overseas shippers showed some variation according to the lines handled. While some pi ices advanced to tho full extent of the exchange increase, others rose only a portion of the amount, and in some cases the whole of the extra loading was carried overseas. The latter policy was adopted largely by manufacturers of proprietary lines, which they recognise must be kept before the public. For the time being retail buying was stimulated, but a gradual check became evident when the full extent of higher costs wns passed on. Trade was again disorganised as a result of the further taxation proposals of the Government, including the sales tax and extra duties on several staple lines. A further revision in price-lists was necessary, and quiet-- conditions obtained during most of February. Normal Flow of Business Business began to straighten out in March, and trading resumed a normal, if restricted, flow. Stocks obtained before tho advances required replenishing, and there was again a steady demand for every-day lines. The general turnover during March was somewhat restricted, and stocktaking occupied some time. The distributing trade was quiet, and events in the United States had tho effect of disturbing trade there. There was a. -welcome change in business just prior to Easter. By that time retailors' stocks were low and, as soon as Easter buying developed, merchants were called upon for further supplies. As far as trade was concerned, the Easter period was a good one and most businesses reported greatly increased activity, with a consequent gain in turnover. However, conditions are still such that merchants distributing goods of all kinds must keep a careful watch on the position. In an endeavour to work with minimum stocks, retail traders have reduced orders to very small proportions, and many order supplies onco or twice n week. This has had tho effect of increasing clerical work for -a less profitable turnover. With the resumption of trade , activity to-day, interest is centred largely on the position with Australia, owing to the possibility of a more favourable agreement. The produce market may be affected, and tho suggestion of lifting the embargo on New Zealand potatoes has already caused some inquiry. Quiet conditions have ruled in the produce market, but just at present the rise in potato prices is causing interest.