GOODS could be sold at 3% less than average list prices and the percentage of profits could be increased if billing, credit work, and other bookkeeping on orders could be eliminated.” This is the emphatic statement of the manager of Saimoon. Office expenses in this concern form an overhead charge that is practically the same for a $5 order as for a $5,000 one.
Records show that customers of Saimoon are buying in smaller and smaller quantities until the problem of reducing the overhead on less than $5 lots has become serious. Constant hammering and study brought reduced expenses in many operations, but each order has to be examined for credit, billed, and recorded in the books.
Added to this tendency on the part of the customer to buy more often and in smaller quantities is the in creased expense of labor and supplies. These are burdens both the small and the large wholesaler apparently have to bear about equally in proportion to their volume of sales. In smaller houses perhaps only half a dozen persons handle the order, while in a large house doing business on a national scale it may be handled by 50 or 75 persons before it finally reaches the files.
Investigation points convincingly to one fundamental means for meeting rising labor costs—the cutting down of wasted effort. Whatever the methods taken to lower labor costs they all are based on this one fundamental. When wasted motion increases, when men are walking and not working, then the business is on the decline that may lead to a bankruptcy court.