The talking machine world (Jan-Dec 1913)

THE TALKING MACHINE WORLD. i:>, with The World in its educational work for the development of trade. The charge for advertising space is reasonable and the values delivered are large. Start the New Year with The World habit! PRICE maintenance is a trade principle in which every merchant should be interested, for price maintenance means that uncertainty and haggling are eliminated, likewise unjust discrimination among customers. It likewise guarantees to the purchaser a standard of quality, and there is no other way in which a full standard of value is secured everywhere in the retail world than through a uniform selling price The national advertising of a trade-marked article naturally creates a reputation for the article and a universal knowledge of its rightful price and value. For years the editor of The Talking Machine World has steadily advocated the one-price system in the music trade field. As it stands to-day in many trades, the transaction of buying and selling is a contest of wits. The seller gives in many instances as little value and gets as much money as he can. Within ample limits the seller might legally lie with impunity; and, almost without limits, he might legally destroy by silence a really good bargain. But that condition is wrong, because it creates a widespread system of cut-throat prices which in the end does not deceive anyone. New methods of doing business in a thoroughly up-to-date manner are essential. When the one price is established by the manufacturer the unscrupulous merchant is forced to abandon his plan of the substitution of cheap and inferior products for the standard articles. In this way the producer will secure in a larger degree his rights as a manufacturer, and the retail purchaser will have the guarantee of protection in so far as the price and quality are concerned, and the whole system of bartering and haggling, which almost amounts to a battle of wits, will be done away with. ANDjyet the Supreme Court says that a contract by which a manufacturer binds a retailer to maintain or establish a selling price on his trade-marked article is void, because it prevents competition between retailers of the article and restrains trade. In other words, the United States under this ruling denies to makers of . copyrighted or patented goods the power to fix by notice the price at which each article should be retailed. The court in this ruling has interpreted the patent and copyright laws and declared that they did not confer such special privileges as are recognized by the courts of Great Britain. In other words, in this country, under the Supreme Court ruling, price maintenance of copyrighted goods is not allowed on the ground that it prevents competition between the retailers of the article. The Supreme Court says that a contract which prevents a dealer of a trade-marked article from cutting the established selling price restrains trade. Following out this line of reasoning, is not every contract in a degree a trade restrainer because it imposes certain conditions; but there is a difference between a reasonable and unreasonable contract — a contract which insures stability to the product itself and a guarantee to the purchases. In the talking machine field it is universally conceded that the contractual relations which have existed between the manufacturers, the jobbers and dealers have been the bulwark of the industry and have saved it at all times when there has been a severe strain, or when there has been an inclination on the part of some to dispose of talking machines at cut prices. NO stronger argument could be made in favor of price maintenance than is illustrated in the history of the talking machine business, and facts can always be relied upon to tell us whether a trade practice is consistent with the general trade welfare or not. Abundant experience establishes the fact that the one-price system, which marks so important an advance in the history of the trade, has also increased the efficiency of merchandising, not only for the producer, bul for the dealer . 1 1 1< I consumer as well. II it were possible for a purchaser to enter a talking machine store in New York and purchase a standard talking machine at less than the established price, conditions would shortly be created which would threaten the stability of the trade in a degree which would be unprofitable and unreliable, and the manufacturer who has expended vast sums to create a demand for his product would find that the values which he has created and the standard which he has guaranteed would be shaken and destroyed almost through the medium of cut-throat prices. If a dealer is selling unknown wares or products under his own name, he has a perfect right to set a price; but when he is using somebody else's name in order to sell the goods, a name perhaps the owner of which may have spent millions to establish, then there are other rights involved, and the owner of that name has, by his investment, created in it certain property rights, certain guarantees to the public, and these rights should be respected. Why should anyone have the power to depreciate in the public mind the value of a name upon which millions have been spent to create a demand for it and create a value for it in public opinion? THE practice of price-cutting on standardized articles would mean ultimately driving that name out of the industry, or depreciating it to such a degree that it would be unprofitable, because cut-throat prices mean eventually the lowering of a standard and by and by the name would become depreciated to such an extent that its value would be lost. Then thejpublic would suffer because certain standards, representing the highest type of workmanship, backed by the manufacturers' guarantee, would disappear. Along these lines of reasoning, it will be observed that in all the advertisements of the stores where cut prices are used there appear the names of certain standard articles. This is done for what purpose? Simply to attract persons to the store by offering a bait, by giving the idea to purchasers that such a store is enabled to give lower prices than others, and, to prove it, puts forth a standardized article at a cut rate. Possibly it is sold at cost, but the impression is created that if one house can afford to do it others can; this really is not legitimate merchandising. No merchant can have the desire to sell articles on which he must lose money. He advertises the sale obviously to attract trade, with the hope that readers and customers will be impressed with his ability to supply cut rates on other lines of merchandise than those advertised. The greater the name advertised, the greater the temptation to the price-cutter to secure some products of this particular line in order to cut prices and to fool the people. SOME of the superficial thinkers allege that price cutting on a trade-mark article injures no one, and that the producer is not injured, since he has received the full price in the original sale to the jobber and retailer. And some argue that the lowering of prices mean a wider market. A false reasoning, because no price cuts can be made on standardized articles without impairing the reputation of the article, and a lessening reputation means a shortening of the demand, and in time the manufacturer's market is destroyed and demoralization exists in trade circles where his products may have had previously a steady and reliable demand, affording a reasonable profit to jobbers and dealers. We have always believed that price maintenance on patented articles was not a monopoly. On the contrary, it affords a protection to the trade and to the public. The manufacturer knows the value of the article which he has labored to create, and wherein does he seek special privilege when he makes contracts to prevent retailers from slashing a price which he knows to be fair and just to the public? In order that business may be conducted along sound and progressive lines, it is necessary that the customer have confidence not only in the quality of the article, but in the fairness of the price which he pays. What an element of strength the talking machine dealers havejn standardized prices, and what protection is afforded them by the maintainence of those conditions!