Full text: Controlling seasonal slumps

METROPOLITAN LIFE INSURANCE COMPANY 
A men’s clothing factory finds that its dealers will accept in 
advance 50 per cent. of their average sales during the preceding 
eighteen months. In women’s clothing, where style changes 
are of great importance, Floersheimer and Salkin counter- 
acted their “summer decreases in production . . . a 
costly nuisance in all respects,” by offering to make any gar- 
ments that their customers might need to supplement ex- 
hausted stock. Pip SALkinN says: ‘Usually we do not 
cut less than a certain minimum quantity of one shop order. 
We took off this limit for summer. . . We explained frankly 
to our customers that our object in offering this service at just 
about factory cost was to keep the factory busy and to break 
even with our summer overhead. . . We are not very 
likely to lose anything under our present plan, but such small 
losses as we do incur we charge mentally into two portions, 
75 per cent. to factory overhead and 25 per cent. to sales 
promotion, because the service to customers is primarily a 
business builder.”* At the same time stability of the skilled 
labor force is secured. The same business man says: “Whereas 
a few years ago we used to keep only the best 20 per cent. of 
our workers over the dull season, soon we were able to keep 
the best 50 per cent., and then 70 per cent., and we now keep 
between 80 per cent. and 90 per cent.” 
A manufacturer of steel and wooden filing cabinets reports 
that his dealers are willing to order in advance if given a de- 
ferred dating for delivery and a guaranteed price (without 
discount). The same is true of a manufacturing pharmacist 
and a wholesale grocer. A builder of farm implements finds 
that some buyers whose storage facilities do not permit actually 
receiving the goods in advance will order ahead if given a 
deferred delivery date. Certain of his dealers will even pay 
in advance to secure this advantage. 
*System, June, 1923, pp. 775-7. 
tFactory. May. 1924. p. 651.
	        
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