We use Optical Character Recognition (OCR) during our scanning and processing workflow to make the content of each page searchable. You can view the automatically generated text below as well as copy and paste individual pieces of text to quote in your own work.
Text recognition is never 100% accurate. Many parts of the scanned page may not be reflected in the OCR text output, including: images, page layout, certain fonts or handwriting.
WHAT SALES ARE PROFITABLE?
BALANCE AVAILABLE FOR SALESMAN'S COMMISSIONS, ADVERTISING, NET PROFIT
$400
$250
$350
$300
"FIXED COSTS" INCLUDE
1. CHECKING CREDIT
2. COST OF COLLECTION
3. DELIVERY COST
4. INSTALLATION
5. SERVICING
6. GENERAL OVERHEAD
■* TO demonstrate to his dealer customers what size sale is profitable and what unit selling prices barely pay their way, Benjamin Gross, of Gross Sales, Inc., New York and Boston, sales agents for Stromberg-Carlson, has been making use of a chart like that shown above.
For various retail selling prices of radio receivers, running from $75 to $400, the chart shows the cost of merchandise, figured at "40 and 10" off list : the "fixed costs" of overhead and selling, and the remaining amount available for salesman's commission, advertising, and net profit for the dealer.
In this way there are graphically presented the amounts, from transactions of various size, which are available for the various elements entering into the dealer's costs and profit.
"Cost of merchandise," Mr. Gross points out, is the amount due the supplier of the goods, and so must be held to be passed on to the manufacturer or distributor.
"Fixed costs" are itemized above.
The cost of checking credit on a timepayment purchase does not vary with the amount involved; in fact, the man who is asking to purchase a highpriced set is often easier to "get a line on" than the man buying a lowpriced console. Cost of collection is also pretty well fixed, and while depending on the number of months over which the installments are to be collected, is independent of the amount collected per month.
BEN GROSS
for the past 14 years has been an active leader in radio merchandising circles, and is well known for his effective sales demonstrations before dealers. He has won national recognition as one of the primemovers of the Radio Wholesalers' Association, as chairman of the Code Authority for Radio Wholesalers and as chairman of the FivePoint Plan for radio industry promotion.
Delivery cost is little different for ah expensive or a cheap console. It also costs about as much to install the one properly as the other. And to service either unit during the contract period costs about the same.
Experience in various stores, collected by Mr. Gross, indicates that these "fixed charges" usually total about $35 per console and that this loading, as just explained, applies eually to all prices of sets, whether $75 or $400.
Out of what is left, as shown at the right in the chart, therefore, must come the amounts required for salesmen's commissions, advertising and, finally, the dealer's own net profit.
Mr. Gross uses this chart to demonstrate that the profitable and desirable sales are those in the upper brackets as shown by the chart. On the other hand, he points out, sales in the lower brackets may be a matter of simply "swapping dollars," or may actually result in a loss on each transaction
November, 1935
IS