The model stock plan

Bibliographic data

Monograph

Identifikator:: 1820833348

URN:: urn:nbn:de:zbw-retromon-210730

Document type:: Monograph

Author:: Filene, Edward A. http://d-nb.info/gnd/123562244

Title:: The model stock plan

Place of publication:: New York

Publisher:: McGraw-Hill Book Company

Year of publication:: 1930

Scope:: xiv, 253 Seiten

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Chapter II. Choosing price levels to increase sales

Collection:: Economics Books

nS THE MODEL STOCK PLAN largest number of people buy. Setting these full-line prices accurately is vital to the success of the plan. We can check each of our full-line prices against carefully selected stores. I have three actual stores in mind, which I shall designate with numbers: x is an exclusive store, 2 is a popular store, and 3 is a low-price store. These distinctions are not absolute. Rather, they are characteristic. Naturally, the business of store 3 does not begin with low-priced merchandise precisely where 2 stops; nor does 1 begin with high-priced merchandise where 2 stops in that direction. The business of all three overlaps to an extent. Thus, store 1 may carry a given line of goods as its cheapest full line, while store 3 may carry the same goods as its highest-priced full line; and these goods may be the best-selling full line of store 2. This fact indicates the value of correcting our full-line prices, as shown by our sales records, against what we can learn about the goods that are actually selling in quantities in other stores. The tendency, on an unscientific basis, is almost always to fix the higher prices speculatively with the idea that the mass of retail customers, being attracted by the article, will pay the price at -which it is marked. And so the mass of customers will pay it, sometimes. But they will not pay it and cannot pay it, as a rule; that is, the article can- not be steadily sold in great quantities at this erratic price set to get as much profit as possible. So the total sales are lessened, and the percentage of overhead or indirect expense is consequently increased. Thus the traditional method of fixing price levels tends to increase the store’s cost of doing business. But, as soon as the three prices which the average income of our customers will allow them to pay is factually fixed, the buyer for this market at these prices will center his a 1 Many a merchant who handles the “better trade” would be surprised to find how many articles his customers, prosperous as they are, buy in five- and ten-cent chain stores, dollar chain stores, and the like. This fact, which is not yet widely recognized, makes it probable that more and more, even of the higher-price stores, will establish basement stores.

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