BUSINESS SLACKENING

Otago Daily Times, Issue 26772, 15 May 1948, Page 6

BUSINESS SLACKENING

Problem for Retail Trade in Dunedin There are more goods now in most of the shops in Dunedin than there have been for many years, but for various reasons the retail trade is experiencing a slack period. Inquiries made by the Daily Times yesterday revealed that the public demand had decreased considerably for such lines as furnishings, clothing, groceries gnd radios. Reports have been received that one or two shops have reduced their staffs as a result, while a number of others have reduced their prices in an endeavour to attract more business. Greater concentration is being made on the numerous forms of advertising, and window displays are becoming even more inviting.

“ Business is slack,” a member of■ a furnishing firm in the city told the Daily Times. He said that the shortage of houses was the reason, and explained that many young couples would furnish a home completely if they had the home. There had been a keen demand for all kinds of furnishings after the war, principally from newly-married couples as well as those contemplating marriage. Many people, however, had only ona or two rooms to furnish, and had since been unable to obtain other accommodation. Couples living with their parents were obviously not interested in obtaining their furniture until they could get a home of their own. Reference was made to two furnishing firms in the city which had been forced to reduce their staffs because business had become so slack. Apart from furnishings, the shortage of houses is claimed to have affected the sales of a number of other articles necessary to make a home. More than a year ago, it was stated that the number of receiving licences indicated that almost every home in New Zealand possessed a radio. In recent months, radios have been extremely difficult to sell in Dunedin. It is reported that a, radio-manufacturing firm in the north has reduced its staff by. half. The clothing trade in Dunedin is exceptionally well supplied with certain lines, but many shortages still exist—such as shirts and dark suitings, as well as blankets. Women’s wear is plentiful. A member of the trade said that the influence of many factors was being felt. Wages made costs high, he added, and manufacturers were inclined to produce more of the. articles on which the greatest margin of profit was allowed. Some lines were in abundant supply, and retailers were cutting prices to stimulate sales. Some prices could not be “ cut,” but in these cases the public was apparently "waiting and hoping.” Grocers had stocked their, shops heavily during the past year in anticipation of shortages, and some were nbw holding 12 months’ supplies, said a man in the trade. In the past, the public had bought many grocery lines whenever they were available and irrespective of whether they were wanted or not. He believed that most pantries were well stocked at. present as a result of this buying. Because grocers now held plentiful supplies, the public seemed to have lost its “ inclination to hoard.” Sales, accordingly, were declining as the people were buying only their immediate needs over and above what they already had “in stock" at home. On the other hand, he added, many articles in the grocery line which could be sold readily were not available. , _ If has been reported to the Daily Times that, after the shortage of cigarettes last year,, imports were heavy. Tobacconists and grocery shops in the city have their shelves well filled with cigarettes at present, while merchants are beginning to wonder how long it will take to dispose of their stocks. The demand by the public continues to be strong. ‘ The attention of shoppers in Dunedin has been particularly attracted this week by “monster food sales,” “ big drapery clearances,” “furniture reductions,” and “ bargains in women’s wear.” _ Announcements have reminded shoppers of “ special bargain values,” “prices cut to cost,” “the best bargains for many a moon,” “ more for.your money,” and so on. Brightly-coloured displays fill the windows, every article is revealed at its best, prices are “slashed to bedrock”—and yet the public enthusiasm to buy is not greatly stirred, and serious shopkeepers pensively stroke their chins.

Those with whom the Daily Times discussed the position yesterday were inclined to agree that it was “more than a passing phase.” Money had lost its value, they said, and customers were beginning to realise the small extent of purchasing power. Mention was made of the trend in America to sell below cost for a time, but it was emphasised that the comparatively small firms in New Zealand had not the resources to attempt this. “ Production impetus ” should be diverted from goods which were plentiful to those that were scarce, it was suggested. One man, however, did not agree. “ How can furniture manufacturers be expected to switch to the production of eggs and honey? ” he asked. "Why should radio manufacturers be required to turn out shirts? ”