WOOLLEN TRADE

Dominion, Volume 13, Issue 265, 3 August 1920, Page 6

WOOLLEN TRADE

BRANDING THE PROFITEER

DEVELOPMENTS IN UNITED STATES

"Branding the Protiteer" is tho title of a remarkable article which appeared in tho "Saturday Evening Post" of April SI last, and which has led to a great deal ' of discussion. . "We are tired of seeing tho retailers .... hold, one another's hand and hearing thfeir sobs. Their gross profits are often larger than the whole previous cost of .the suit—material, exponses, profits, and . fylli. I believe some of them have forgotten to figure costs, and merely charge alt ... they-cim »et." Thus an American wool- , Jen manufacturer. Tho writer of the ar- ' - Wcle wonders whether the grower of the wool, orthe-manufacturer of the wool or v the fabrics, is quite fair in, his argument. Both of them emphasiso the small sum in dollars when the product leaves their hands, seven dollars when it leaves the grower, and- twenty dollars when it leaves the mill. At the time-this article was .written a large cutter-up got thirty to fifty dollars for a suit, the wool in nhich ■ cost him from ten to twenty dollars. But in view of the fact that garment workeis are making" fifty, sixty, and even seventy •itdollars a week, and bearing in mind ■that a-retail store business in this and sillied lines must make over SO per cent, gross to livei at all, a few cents added to the pound of wool or a dollar added to a yard of cloth has the accumulative . effect of a snowball rolling downhill.' "The rise of . a dollar a yard in clothi is said to necessitate at least seven or flight dollars added to. the retail price of IB suit. So when the wool grower and tlie • cloth. maker / point to the small increase - in their prices as compared to the enor- ■ mous jump in retail prices, they are . dealing largely with fallacies. Tho 'farther you get along in manufactured . products of this sort the greater the pro- ; portion ate increase must be from the ivory Datura of tie case. The retailer las to carry all the previous costs and profits in his own prices, a simple, 0b- ... rvions fact that most people overlook. (But though tho woollen manufacturer • -finds it difficult to-see the retailer's .troubles, he. will readily admit those of the cuttor-up. Here is the fetory of high clothing cost as told by the president and secretary of one of tho large woollen manufacturing associations. It reflects only the naturally one-sided point of ~, yiew of one group of the industry, but it 6 essential to an understanding of the v subject. . First of all these gentlemen admit the difficulties of the clothing manufacturer or cutter-up. ... -'The expenses of tho cutter-up have ttsen enormously because of tho high .wages and reduced production. At this stage labour is a bigger element than cloth.; The making of clothing used to be on a competitive basis on the •part of the . workers. It • was a piecework proposition. Now it is on a weekly basis, and they don't really have to work any more. I heard the head, of the union say that no ono was - -making less than forty-four a week now. They used to make twelve ■dollars. let ns grant 'that the former eweat-shop scale of wages was wrong. • -'The fact remains that with ■ such an pnormous jump in wages olothing must post more. ' . "You must remember that the yarn Hnd fabrio manufacturing industry was a unit before the war in that it man- - aged to supply • the people. . It remained the same -until during the war. There ' 'was no effort at expansion; but by October, 1918, only 33 per ccnt. of the looms wero on civilian cloth. From 60 to 65 per cent were on military cloth. Naturally this created a tremendous hole in civilian cloth. Meanwhile the Government hnd taken practically all the wool. Such looms as still ran on civilian had only their reserve stocks' of wool to go '..■on. 1 The Government counted on a ■ v short war, but at tho samei time it planned for an army of 5,000,000. If that number of men had been put in tho field and the war hnd lasted five months : longer, you would have seen the most terrible panic, in the civilian clothing industry that you can possibly imagine. ■aAs soon :ns.-t'he armistice came we urged V-tiie Government to release wool, but wo bumped up against tho wool-growers, •also against the clothing' manufacturers and . tho retailers. Tho growers, of course, did not want to see a. decline in • the price of wool, and tho clothing manufacturers and the < retailers had civilian clothing on hand -of an inferior . quality, due to the scarcity of civilian . -wool, and naturally they were afraid we would cut under their market with better, quality cloth if wo could induce the Government to let ius have all its •■tremendous stocks of wool. It wasthreo V months before we could got any Government wool' except at tho issue price, - which everyone was afraid of as being ■ too, high. ' Nor could we import any. Por a time, of course, shipping conditiong made it difficult to bring in "col, though this .country raises only 45 per •cent, of what it consumes. After the : j armistice the growers opposed imj>ortation. : ''By January, 1919, only 19 per cent, of . the looms were on Government work as compared to something like 65 por cent, before the armistice. Civilian \york •'' occupied 83 to 39 per cent., and the rest •? e jVii e ' ®' V arc ' l Government work i had fallen to 1.9 per cent., and still only ' W per cent, were on civilian. In other ' ; words, only a year ago 68 per cent, of •'. the looms were actually idle. In nlairi jlanguage, there had been five months of • disaster in tho woollen industry, because ' of - laok of prompt distribution of the jSnrplns, stocks of wool. There was loss °f confidence and literallv no market nt alt. One of the biggest units in the . i country was down to 8 per cent, of . .capacity. Also there were strike* at i Lawrence, Philadelphia, and Passaic. There was no recovery or return of the ; Industry until November of 1919. We '. had at last been able to get in English •wools, and from November to date we iJiave been-going strong, producing doth at a tremendous rate. Barring further 'labour troubles calculated to cut down production, there is soon'going to bo • something approaching a normal amount of oloth. Of course there has been speculation on the*, woollen market, conditions were such that you could not hold it ' back. But don't mako the mistake of cursing the jobber overmuch. This martot would never have got out of its slough of despond at all if it had not • been for tho legitimate jobber, with his willingness to speculate. He is tho ono who Started the machinery last spring. We did not start it, neither did the clothing manufacturer. It was the nraob abused jobber. Having no risk of conversion to carry, not being hampered by changing labour costs he could buy freely when the wool and clothing manufacturers were afraid to movo. At first it wns true that a large _pnrt of the reserve stocks of goods got into the hands of the jobbers, both legitimate and illegiti- • mate. But- stocks are now out of tho middleman's, hands. These speculativn stocks of cloth will soon disappear, certainly as soon as the market is at all stabilised, and along with them inordinate profits will disappear." Some ten days ago a cablegram received in Wellington reported that somo of the big woollon plants had closed down in tho United States. Probably tho tremendous rate" at which they.had been manufacturing since wool was freely obtainable lias enabled them, with- the economies which the people have cffectica36 °' " 10 denim craze, T?niw? Up :\ nd P ara the demand. Following upon this, cables have been ofTtlin 01 Sds roPPing in the price