PROFIT IN THE LAST £20,000

Wanganui Chronicle, Volume 73, Issue 428, 20 November 1930, Page 9

PROFIT IN THE LAST £20,000

SALES POSSIBILITIES IN TIMES OF DEPRESSION To sonic concerns advertising is the life of the business, and any decrease, in advertising naturally results in a decrease in sales, because it results in a decrease In consumer demand. This is particularly true of small-unit products, those articles costing a small amount ot money and bought directly as a result of advertising.

To lhe high-unit manufacturer where the purchase price of these goods runs into a considerable amount of money, and where a great deal of time and thought is given to such expen IFire by tne consumer, the process is hkely to be slower, but the result is the same if advertising is cutIf a business docs £lOO,OOO yearly, then it is very probable that the profit lies entirely in the last £20,000, and if a manufacturer, by a slightly increased expenditure fur advertising, can maintain this £20,000 volume through a period of depression, or even come close to this volume, then he is far better off, isn’t he, than he would be if he reduced 1-is advertising? A manufacturer who weakens his advertising during times or depression usually pays the bill one way or the other. In most eases by showing a bold front and redoubling the merchandising efforts behind his advertising campaign, he is far better off in net financial return than he would have been had he drastically reduced advertising and allowed his bu/ness to lapse severely backward. There is only one case in the estimation of Mr W. B. Henri (whose remarks give rise to this article) that warrants the elimination of advertising and that is when the advertiser Mi’t. the monev to pay c or it. “I believe,” he says, “that those concerns which have good fit uncial backing through periods of depression maintain their aavertising. As a result, over long period:- of time, those concerns are mls.T ling ’eadeis i»their industry. )r ’he best, mon- ’ makers—or both.” \