Radio today (Sept 1935-Dec 1936)

WHAT I WOULD STOCK THIS FALL Merchandiser talks about radio dealer s buying problems By H. L. M. Capron* * MANY persons who have spent the best years of their lives in the radio business, and who certainly should know it, hold the opinion that the year 1935 will rival good old 1929 in point of sales. In support of this belief the facts and trends of the industry are freely quoted. They certainly point to a great year. Nationally, about 63 per cent of the homes now have radio, ranging from a low of 24 per cent in Mississippi and 28 per cent in Arkansas, to a high of 90 per cent in the District of Columbia, 90 per cent in New York, 87 per cent in New Jersey, 82 per cent in Illinois and 80 per cent in Maryland. In spite of this apparent market saturation, these are the facts which point to a banner year's business : 1. About 15,000,000 of the radios in use are from 3 to 7 years old, and may properly be classed as obsolete. 2. Excellent compact radios have found a very definite demand as personal and "second" radio. 3. The trend in unit sales has been sharply upward since 1932. 4. The trend in unit prices has been upward since 1933. Flood tide The flood tide of the replacement market has started to flow strongly, and this year the following influences will speed it up : 1. All-wave radio that will really give good foreign reception. 2. All metal tubes, around which a great selling story will be woven. 3. Higher fidelity, a much closer approach to really lifelike tone, which every radio owner wants. 4. The greatest collective manufacturer's advertising campaigns since 1929, which cannot but create a greater urge to buy these really better radios. Each dealer will probably get his full share of this added business if he goes after it. And he may be reasonably sure that if he is not getting it, that his competitor is. Planning your purchases and stock, *For the past 14 years manager of one of the largest retail radio businesses in the world. Charts and figures compiled by Mr. Capron from original sources. and your sales promotion, is going to be mighty important this year, too. Too heavy stocks are certainly to be avoided, though one major manufacturer already reports sales in excess of supply. Based upon the records of many stores in all parts of the country over a period of ten years, you may reasonably expect to do 8% of your total year's business in September, 11% in October, 14% in November, and 18^2% in December. If you take your actual August business as 5%, the above ratios will serve as an excellent guide to your buying. Total business should range between 22% and 25% better than 1934. Money in the pocket Do not buy discounts, for long discounts are no more indication of profits than long odds are an indication of large winnings at the track. You have got to SELL the radio AND GET THE MONEY before you can count a profit earned. Because of uncertainty in the tube situation, protect your position by having in stock sets using all three types of tubes — glass, metal, and the glass-metal combination. Give full importance to the cooperative selling helps that the manufacturer will give you, and the long time reputation, too. Based upon an annual business of $10,000, a model stock would be comprised of : — COMPACTS— 33% of total units, and 12% of total value. TABLE MODELS-^0% of total units and 32% of total value. CONSOLES— 27% of total units and 56% of total value. Within these broad classifications the ratios and price ranges constituting the best sellers are : COMPACTS 2 leaders @ $10 to $15 $30.00 2 @ 20 40.00 4 @ 25 100.00 1 (n> 30 30.00 1 @ 35 35.00 $235.00 TABLE JIODELS 2 @ 30 60.00 2 @ 40 80.00 4 @ 50 200.00 2 @ SO 120.00 1 @ 70 70.00 1 " ' @ 90 90.00 $620.00 CONSOLES 1 <g> 50 50.00 1 @ 70 70.00 ■A @ 110 330.00 1 @ 125 125.00 1 & 175 175.00 1 (a) 275 275.00 $1,025.00 This model stock for a ten thousand dollar business has a retail value of $1,880, and an average unit value of $62.66 It is not a complete assortment, but concentrates in fast-moving price ranges, and is a perfectly safe commitment for October. If your annual volume is in excess of $10,000, this stock can be built up to one appropriate to your business by adding 50% in each price range and classification, and $500 to broaden assortment and price range for each ten thousand dollars by which your business exceeds the base. Model stocks should be maintained on the basis of actual sales plus the expected normal sales of the next month. The chart of monthly percentage of annual sales will be a guide in this direction. It is desirable to keep adequate stocks for current demand so that your customers may receive immediate delivery, and yet kept small enough so that ware 20 15" -10 5 K 5tai 5 i lormai r< adio sale 1 <iu<a<DD5iiJUOuj ■^"-5<2 — > — » < <0 O Z O Relative business the radio dealer should expect to do, month by month 24 Radio Today