Automatic Age

Issue: 1937 September

13
AUTOMATIC AGE
September, 1937
Ships That Pass In The Night
By A rth u r W . Luchs
Sound Enterprises
HE night falls as a mantle
Need Not Hide
on both land and sea,
masking the good and
Perhaps those two passing
legitimate, enterprise as well as ships will never rest in the same
the unscrupulous activities of harbor together, but will con­
the fraud, or shark who preys tinue to pass each other on the
upon legitimate humans and or­ we'll traveled ocean lanes. Even
ganizations, in the manner of a though their captains never
parasite. In the parlance of the meet, their company and its his­
sea, “Ships that pass in the tory is an open book. They have
night” refers to the ships one nothing to hide from prying
meets in the dead of night, while eyes; they are open and above
crossing the vast ocean. Far in board. They have the respect
the distance, the lights of the and admiration of their fellow-
coming ship are sighted by the men.
lookout in the crows nest, who
The mantle of night also
sings out the discovery, or masks the furtive, slinking boat
phones it to the captain on the and its captain known as the
bridge. The captain who has shark, who sails the seas with
consulted his sailing schedule for all lights extinguished, his mis­
regular scheduled ships, knows sion to prey, rob or smuggle,
to a certainty the name of the whose sailing schedule is never-
ship now nearing him, the com­ published, who flies a flag and
pany owners and its destination. shows lights only when neces­
He gives the welcoming blast on sary to shield his identity from
the ship’s siren and the vessel, passing ships. No legitimate
passenger ever selects a ship of
which is rapidly approaching re­
that character to carry him.
taliates in kind. Thus the amen­
Passengers who desire to sail
ities of the sea are transacted across the sea, with its potential
between two legitimate shipping threat of disaster, prefer to en­
leaders, who perhaps have never trust their safety to r eliable,
had the opportunity of meeting legitimate steamship companies,
personally, but who honor and who exert every precaution to­
revere the company name and ward the sole purpose of deliv­
the captain of the ship which ering their passengers safely at
draws near in the night. A feel­ their destination.
ing of solidarity, respect and
Deal with Reliable
mutual admiration for each
Manufacturers
other is voiced in the crass blare
The coin machine industry
of the ship’s siren, heard in the
also has its ships that pass in
dead of night at sea. Back of the night. They are the manu­
those signals stands a company facturers, distributors, jobbers
with integrity, reliability and and operators with whom we
years of effort devoted to mini­ have our regular contacts. They
mizing the loss of life and prop­ are reliable, trustworthy and
erty at sea.
guarantee their products. They
T
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advertise in the regular trade
papers of the industry, maintain
a regular establishment, abide
by standard prices to all and
lend their best efforts toward
raising the standards of the in­
dustry.
This group comprises the le­
gitimate ships that pass in the
night ,steadfast and dependable,
with whom it is a pleasure to
do business. We know that they
will make good on their prom­
ises. We know that it is safe to
send them money on an advance
order and that we will receive
the games for which we paid
them. We know that if the
games develop flaws or break
down, they will make good on
them. With that surety, it is a
pleasure to do business with re­
liable coin machine people.
Beware of Sharks
and Frauds
We also have the shark, or
fraud, who preys on the unsus­
pecting coin man or woman, un­
der the guise of legitimacy. He
works out of some small office,
sometimes with a pretentious
front, or in many instances he
uses the address of a prominent
building to fleece operators who
respond to his advertising. This
type of shark is similar to the
ships we pass in the night who
are on illegitimate business. He
is a human parasite who gyps
coin men. He shows false col­
ors and credentials in an effort
to avoid detection and fleece coin
men out of their money. Very
seldom does he advertise in the
legitimate trade papers of the
industry, who maintain high
standards in an effort to protect
(Continued on page 23)
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i4
AUTOMATIC AGE
C o n s id e r E a r n in g
In v e s te d
W h e n
September, 1937
P o w e r P e r D o lla r
B u y in g
M a c h in e s
By Dave Bond
u r i n g the past two
years, there has been a
decided increase in the
cost of all types of automatic
equipment. This was made nec­
essary by the ever-increasing
cost of labor and materials; So­
cial Security and pay-roll taxes,
etc.; and the vastly improved
construction of the newer ma­
chines.
It is idle to contend that the
manufacturers increased prices
arbitrarily, for any such course
of action would be suicide. The
manufacturers realize full well
that they are subject to competi­
tion and, further, that it is de­
sirable to place as low a price as
possible upon their products, in
order to secure adequate volume.
A m anufacturer increases a
price with great reluctance, and
only on account of absolute
necessity.
As a matter of fact, the prices
in this industry are entirely too
low, compared with the mark­
up secured in other businesses.
Upon a comparative basis, coin
machines are sold cheaply and
much below the standard mark­
up enjoyed by any other indus­
try; particularly when it is con­
sidered that in many industries,
a volume production is secured
far in excess of the coin machine
industry. This is particularly no­
ticeable when an executive from
another industry steps into this
field and is really surprised at
the existing conditions. It is a
tribute to the ingenuity of the
merchandisers and engineers in
this field that they are able to do
business on such a close margin.
D
D a v e B o nd
Too many operators are price-
minded and are only interested
in the number of machines they
can buy for their investment,
rather than what their invest­
ment will earn. The only real
test is not so much the price per
unit, but rather the earning
power per dollar invested. This
is the only real test.
It does an operator little good
if for an investment of $5,000
he can buy a thousand units at
$5.00 each. The important thing
is what his investment will re­
turn to him after he has consid­
ered all the elements of expense,
such as installation, servicing,
etc.
Recently a local operator
about to purchase a route of
merchandise machines investi­
gated the field very carefully.
He happened to run across a
route of handkerchief machines
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of the counter type, which he
was able to purchase for $2.00
each. There were five hundred
machines in this route and he
seemed very gleeful about his
purchase, and felt that he had
made a real buy, and that he
would profit nicely on his invest­
ment.
However, after a few weeks,
he began to realize that the turn­
over upon this type of merchan­
dise was very slow and, further,
that the cost of servicing was
very large, and that it took him
a considerable length of time to
service this route properly.
Within a relatively short time,
he offered the route for sale and
at the present time, the route is
so unprofitable he is not even
bothering to service the ma­
chines, and the likelihood is that
they will be left on location and
simply neglected. This operator
was blinded by the fact that he
could buy a lot of machines for
a small investment.
An operator should estimate
the cost per call to determine
whether a collection at a partic­
ular spot is profitable. For ex­
ample, suppose an operator val­
ues his time at $50.00 per week
and the expense of his car as
$15.00 per week. This means
that he has an expense of $65.00
per week. Suppose he can make
twenty calls per day comfortably
in servicing merchandise ma­
chines, and that he works five
days per week. This would mean
that his expense would figure
$13.00 per day, and that the cost
per call would be 65c. In other
(Continued, on page 25)
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