16 THE MODEL STOCK PLAN 
hat for ordinary everyday wear. For the purpose of illustrat- 
ing the principle, this price is as good as any. Perhaps your 
trade falls at a higher or lower level. Perhaps you do not 
deal in hats, but sell radio receiving sets or furniture or any- 
thing else. The example is just as good as though it were 
selected to fit your particular price level or your particular 
type of merchandise, for it serves to illustrate the principle. 
Our average customer, then, buys a $10 hat for everyday 
wear. But there are times when she wants a hat a little 
better than ordinary, it may be to wear to an elaborate 
luncheon or simply because she feels more prosperous than 
usual. So she wants to pay more, perhaps $15.2 Conversely, 
she may want or be obliged to economize. Under these 
conditions she pays less, say, $s. 
The exact figures are important in operating our store; 
but in explaining the method, these arbitrary figures will 
serve to illustrate the point. Our average customer pays in 
the main, therefore, three different prices for hats accordingly 
as she wants something inexpensive, for everyday wear, or 
for best. She behaves similarly in respect to every class of 
poods, whether it is shoes at $5, $8, and $12, or cloth coats 
at $25, $40, and $60. 
Our customers are not all of one income class, however. 
For our more prosperous customer a $15 hat is for everyday 
wear, a $10 hat inexpensive, a $25 hat best. Our less pros- 
perous customer considers a $10 hat expensive, a $5 hat for 
everyday wear, a $3 hat cheap. 
Let us tabulate this to visualize the demand: 
Low-income customer... 
Average customer.............. 
Hicher-income customer... 
[Inexpensive 
$3 
5 
ra 
Everyday 
$s 
| eo 
Best 
10 
bre 
25 
1 Actually, a good many of our customers will wish to pay more than $15. 
The best and most profitable way of handling this situation will be dealt 
with subsequently.