Sixth Census, 1840, June 1-Population and Agriculture. Three reasons why the census of population and agriculture should be taken together: (1) A more complete and accurate census of agriculture is secured by taking the two together, as has been shown by the experience of the Bureau of the Census in taking the census of 1920, which included agriculture and population, and a census of 1925, which included agriculture alone. The censuses of population and agriculture have been taken together and by the same enumerators ever since the first census of agriculture was taken in 1840. (2) It will prevent a duplicate enumeration or a duplication in Government work. If taken together, the field force will be employed only one-half as long as if taken separately. A census is a personal canvass. Hence, the enumerator on visiting each farm in the United States will secure the information for population and for agriculture on one visit. If taken separately it would mean two separate canvasses at two different times and only a few months apart. (3) It will prevent additional cost for the field enumeration. It will mean a saving in Government expenditures. If taken separately it will cost approximately $3,000,000 or $4,000,000 more than if taken together. The CHAIRMAN. We will hear Mr. Matter of the United States Chamber of Commerce. STATEMENT OF JOHN H. MATTER, MEMBER OF THE STAFF OF THE UNITED STATES CHAMBER OF COMMERCE, DOMESTIC DISTRIBUTION DEPARTMENT, WASHINGTON, D. C. The CHAIRMAN. Just give your full name to the reporter. Mr. MATTER. John H. Matter, member of the staff of the United States Chamber of Commerce, domestic distribution department, Washington, D. C. Mr. Chairman, my sole interest is in connection with this bill. My work is in connection with a committee that was organized about six years ago in order to obtain certain information with regard to retail and wholesale trade. We found out that there was a lack of knowledge concerning the commodities on the market and concerning the length of time they stay on the market. We found out that we had figures on agriculture and on manufacturing, and mines and quarries, but nothing as to how to put the material into the proper place from a population standpoint. So, we have seen the necessity of a census on industries, and at the last meeting held by the National Distribution Conference which was held, January, 1925, a committee was appointed and headed by Owen D. Young, and it was decided that a census of industries would be taken, if possible. So, for the past six or eight months we have been cooperating with the Census Bureau, because this is a census problem. Our first trouble was that we wanted a lot of information that we knew we could not get. In other words, we wanted information as to the retailers and the wholesalers, but the retailer's information as to what his sales are, are so vague that they are very lucky if they know what their sales for the last year were. The CHAIRMAN. Gross? Mr. MATTER. Gross; much less tell how much groceries, or meats, or poultry, fish, and dairy products he has sold. So in arranging for the schedules which we were to use in taking the census we had one basic factor in mind, and that was to ask as few questions as possible that would be basic and the answers to which we would want 100 years from now as well as to-day. In other words, 100 years hence we will want to know how many retailers, how many wholesalers, how many cooperatives there were; we will want to know what the total sales were through each channel; we will want to know the average inventory for the year and then also want to know the relation between salaries and wages paid to the entire sales force to net sales. So with that end in view we attempted to devise about 48 classifications of stores. We found out that as a result of the different conditions prevailing throughout the country all of those schedules would not apply. So, in order to arrive at schedules which would be for the most good for the greatest number we considered that we should have about 45 or 48. I The hardest part to determine would be with reference to the retail and wholesale classifications, different classes of merchandise. When say classifications of merchandise I do not mean with reference to a chair, and a table as such, but furniture for the house, or furniture for the office; or meat, poultry, and fish. And, in going to the records in the first city, which was Baltimore, we found that the great mass of retailers, those dealing in food products, were unable to give us even an accurate figure as to their total sales. So, in order to determine it we had to arrive at these different classifications. To-day, a drug store is no longer a drug store, and a hardware store is no longer a hardware store. We asked them to check the various items of merchandise in which they were dealing so that we have a picture now in the 11 cities of the number of outlets for merchandise, but we have no completely accurate statistics as to the volume of sales of each class of merchandise, through those types of stores. Our experience has shown us that by giving assistance to the distributors we can gradually develop a desire on the part of the retailers to get into a better accounting system through perhaps the trade association movement. I might state that perhaps two of the best known organizations are the Retail Drygoods Association of New York, and the National Hardware Association. They have gone into a good many cities and projected uniform cost accounting systems. We find in the latter institution there are only about 1,500 rendering reports out of a total of 44,000. Now, you can take that into consideration. Then, you have those retailers that are not so well organized, or where the degree of intelligence is so much less. Mr. THURSTON. Could this information be more readily and accurately obtained from the source; that is, from the factories, or the importers of the particular articles? Mr. MATTER. No, sir. Mr. THURSTON. The Census, or the Bureau, as I see it, does not deal with imports or exports. Mr. MATTER. We have those figures. We have the figures from the source, but that is not the information we want, because the merchandise flows through too many channels. One plan is, one manufacturer will deal direct with the wholesaler and another may deal direct with the retailer, as many manufacturers do in the case of the chain stores. The CHAIRMAN. How about a concern-if you will pardon an interruption? Mr. MATTER. Surely. The CHAIRMAN. Such as this Real Silk Stocking Co. They sell direct. That happens to be one concern that I know very well. Mr. MATTER. We could ascertain from them, perhaps, with a simple question or two. The CHAIRMAN. And, such concerns as the Fuller Brush Co.? Mr. MATTER. Yes; we could get that information from them very readily. Mr. THURSTON. Let me make this illustration: Suppose that we have an article that is called a novelty. That might be sold in a drug store, a 10-cent store, or in a general store. If you have a quantity output of that from the factory would not that be more accurate than trying to trace that around through a miscellaneous group of stores? Mr. MATTER. It would be but we are not interested so much in the quantity output. We have that. We want to get information from the merchant who is handling that particular article after it leaves the manufacturer or the producer. In other words, I feel strongly that the advance in the next decade will be based upon a closer study and intense cultivation of the methods of selling which we have not had before. We have had the cost of manufacturing reduced, perhaps, to the irreducible minimum. We can not go much further along that line. There may be mass production but we have been putting so much time and attention into production, and the development of a market, and so little time to scientific marketing. I might illustrate that by a very brief illustration in the case of a wholesaler of Hartford, Conn., a wholesale hardware establishment. The head of that concern found that by an examination and an analysis of his books that 50 per cent of his territory was contributing 90 per cent of his net sales, and furthermore by looking into it further he found out that it cost just as much to cover the 50 per cent outlying territory where he was getting only 10 per cent of his trade, in the outlying territory, as it did to get the 90 per cent of his trade in the other territory. Now, bringing that further, he went through his accounts and found that about 60 per cent of his customers contributed nearly all of his business. In other words, it was not worth while to send out men for personal solicitation into that territory. So, that as a result of his studies he reduced his territory nearly one-half, and the number of customers 40 per cent, and the number of lines carried about 33% per cent. It was simply the application of the old theory, simply of fixing the number of customers and stocks instead of operating on the basis of manufacturing output and territory. There is a certain limit beyond which it does not pay those people to go. But, unless they have the funds and the intelligence to study their own individual business they are really out of luck. We have an opportunity to give them some highly useful facts. Mr. RANKIN. Would you include in that the centers of distribution of agricultural products? Mr. MATTER. I think that would be desirable; yes, sir. Mr. RANKIN. Now, in doing that would you have that distribution shown by commodities, that is, where these commodities went? Mr. MATTER. I think it would have to be restricted to the class of commodities rather than individual commodities; I mean by that, that we might be able to get classification of foods and groceries, or taking the agricultural situation, such a classification as citrus fruits. I do not know whether we could get the specific information and follow it through, such as oranges, grapefruits, or prunes, whether we could do that or not, because they lose their identity in the retail stores, and the small retailers are not able to give that information. If we proceed and if we are able to build this thing up, by 15 or 20 years from now we might be able to get that information, but I think if we attempted to get all of the information, or all of the information you desire, it would take thirty or forty thousand divisions. Mr. RANKIN. You could trace practically all of these commodities, at least, to the wholesalers, could you not? Mr. MATTER. Yes, sir. Mr. RANKIN. I think that that would be a very easy matter. I noticed that you stated that the manufacturers had reduced the cost of manufacturing to the irreducible minimum. I wonder if you also think that the farmer has reduced his cost of production to the irreducible minimum? Mr. MATTER. I must plead ignorance, because I do not know a thing about agriculture, Mr. Rankin. Mr. THURSTON. Could I ask you a question there? Mr. MATTER. Yes, sir. Mr. THURSTON. In the 45 or 48 lines you investigate, or feel should be included in this survey, do you include the retail or disposition of petroleum products? Mr. MATTER. Yes, sir. That is, we have a classification, a store classification, of gasoline and oil stores, and in commodities we have gasoline and oil as commodities. So we will show not only the total sales of the stores, of the different kinds of stores, as such, but also the amount of commodities sold through each particular one, and our classifications of the commodities now must be so arranged that we will be able to tell how much hardware is sold through a department store, or sporting goods store, or an electrical goods store, and so on. Mr. RANKIN. When you go to taking this census of commodities by making inquiry as to the amount of gross sales are you not going to run into a great deal of opposition on the part of the merchant who realizes that those figures may be available to the tax gatherer, the tax collector, or the man who is checking up his income tax, or ad valorem tax, for that matter? Mr. THURSTON. Ór to his competitors. Mr. RANKIN. Yes, or to his competitors. Are you not going to have a great deal of trouble in getting this information from these people? Mr. MATTER. It simplifies itself down to getting information as to the cost of doing business, first. Secondly, I have found from my experience with the Census Bureau that they follow out to the letter, the law, and to the strict letter of the law, the policies which have been set, that no report will be issued which disclose or tends to disclose to any individual, or competitor or any other person that information. Furthermore, they do not give out any of that information to any other department of the Government. In fact, they do not give out anything that is given in confidence, and you can be assured that they will not. Mr. RANKIN. Of course, if Congress wanted that information they could send down and get it. Mr. MATTER. I realize that. Mr. RANKIN. And every man making out these reports would' know it. Mr. MATTER. I understand that. Mr. RANKIN. I understood you to say that we were going to want this information a hundred years from now. Now, I do not know who "we" are going to be a hundred years from now, but, taking your statement that we are going to want to know that, won't "we" want to know what they are, and the cost of operation and all of that. Mr. MATTER. Not the cost of operation. Mr. MATTER. Yes, the salaries paid. Mr. RANKIN. All right. Now, if you take that on the man whom you are checking up, that man will know that it would not take very much more investigation for the tax collectors or the representatives of the income-tax department to check him up, or as some gentleman said here a minute ago, for his competitor to get that information, to divulge his entire cost of operation. Mr. MATTER. It is practically impossible, Mr. Rankin, for this reason: The major purpose of this is for the purpose of showing the · cost of selling that applies to salaries and wages, because the greater amount of the reduction in expenses in the future will be centered around efficient sales people. Mr. RANKIN. The Census Bureau-I am going to be frank-I am rather partial to the Bureau of the Census, and the one reason is because of their usual accuracy. They are supposed to give us facts and figures, and they are doing that. Now, are you not going into a field here that will furnish a great deal of rivalry, for instance, when you go to checking up and trying to determine the gross sales of certain classes and sundry businesses and enterprises? Mr. MATTER. I do not feel so; no, sir. The retail element is the element that now wants these facts. Mr. RANKIN. But you say that you are not going to publish them. Of course, you mean advertise them. But let us suppose that we have a situation like this: Suppose that these results are given out,. and there is a town down here that is similar to some other town; and of all pride, commercial supremacy now seems to be the dominating passion of the United States. Here are a couple of cities. down here, and your survey shows that one of them sold $3,000,000 worth of stuff while another only sold $2,000,000, or $2,500,000; and then the other town feels that it is a good deal larger, and they go back and change up their wholesale records and show that they have been discriminated against, and argue along that line. You are going to have the Bureau of the Census led into a great deal. of controversy wherever those results are given out.. |