J. H. Keeney & Co., Chicago, displayed
its electric model, so well known to our
readers. As reported in our last issue, the
firm recently changed ownership but will
continue to build its well-known machines.
• Lehigh Foundries, Inc., Easton, Pa., dis-
played its PX-8 in manual and electric
models.
National Vendors, Inc., St. Louis, had its
display and also the good news that its new
console electric would be ready for ship-
ment by early fall. The firm will now make
steel cabinets for the model, with th e im-
provement in the steel situation. The firm
also has a model of the console designed
for general purpose vendin g of merchan-
dise, promising delivery by July. Th e gen-
eral merchandise vendor has attracted a
lot of attention because of the possibilities
in vending various products. Th e firm also
had its standard manual and electric up-
right machines on display. One of the to-
bacco trade papers gave a personal boost
to Ben W. Fry, president, for the display,
and also to Tom Donahue, secretary of th e
firm.
Pollak En gineering & Manufacturing
Corp., Newark, N. J. , now makin g the
U-Need-A cigar ette machines, ha d two elec-
tric models on display. The firm formerly
made U-Need-A vendors on contrac t and
has recently acquired ri ghts to th e elec tric
machines and reports produ ction goin g ri ght
ahead.
Rowe Manufa cturin g Co., Inc., New York ,
had its machine display in grand style and,
as always, it gave the tobacco trade a good
impression of the ve ndin g machin e way of
selling. Electric and manual vendors were
shown , and the nylon vendor also included.
Malkin-Illion Co., Irvin gton , N. J., and
Cigaromat Corp., New York, di splayed
their cigar vendors and thus gave tobacco
men a view of automati c selling of this
product.
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46
Mas11/act11rer Activity Sign
Of Progress Is Cig Vending
by WALTER HURD
NEW YORK- The cigarette industry is
watching reports on sales a little more
closely th an usual, since hints have ap-
peared that the rate of national consump-
tion may be slowing up. The trade in gen-
eral , and even investors in th e stocks of
tobacco companies, expect the year to show
a good total gain over 1948. But the final
percentage and also the month-to-month
rate of gain over last year may be small er
th an had been expected.
Th ere is so much talk about general
recession in business that trade leaders
naturally wonder if it might lead the
masses to begin to save on smokes. Ciga-
rette smoking is presumed to be a depres-
sion-proof habit but there may com el>a time
wh en people find ways to save on smokin g.
Th at is why the official reports are being
watched in cigarette trade circles.
Government revenu e reports for March
show th at th e rate of gain in cigare tte use
a pp arently slowed in the third month , as
compared with F ebruary. In fa ct, it now
seems that th e first quarter shows a definite
trend in a slower rate of gain. This agrees
with the premise in a general review of the
cigarette situ ation , as published in TJ:I E
REVIEW, April iss ue, page 46. In that re-
view, it was suggested that sales for th e
last half of 1948 had shown a slowing up
in rate of gain.
New York also rep orts th a t its state tax
of three cents on cigarettes for March
produ ced a smaller revenue than for th e
sam e month last year ; for a 12-month
period the state revenue has been climbing
steadily, but th e drop in March has hinted
that a prolon ged decline might begin any
tim e.
With 40 states taxin g cigarettes, th e state
revenues will be watched even closer than
th e fed eral reports. Most states are still
showing good gains in cigarette revenu e,
definite proof th at use of the item is still
climbing. But here and th ere some losses
show up. Th ere is a definite regional pat-
tern in cigarette sales and the state reports
help to keep tab on this picture.
Unfortunately, a lot of states that tax
the produ ct do not keep cigarette r evenue
records apart from other tobacco taxes, or
other form s of revenue, and for th a t reason
it is not possible to get a tab on all the 40
states having a cigarette tax. Only a small
group of states makes prompt monthly re-
ports on revenu es derived from cigarettes,
but these few states· are scattered well
enough so that some hint can be had about
sales trends in different sections of th e
country.
Whil e th e cigarette trad e durin g th e past
five months has had to think mostly about
the prospect of new or in creased taxes, at
the sam e time th e vending machin e e nd of
the busin ess has brou ght ahout some favora-
ble news of in creased activity. A number
of proposal s have appeared to tax vendors
but thus far no serious blow has been
hand ed to th e vendor operators.
In creased activity among manufacturers
of cigarette machines is re ported to be very
definite, and a sure sign that th e outlook
for the year is favorabl e. Th e displays of
manufacturers of vendors at th e annual
convention of the National Assn. of
Tobacco Distributors here, Apr. 24-28, gave
full evidence of the progress that th e ma-
chine makers are showing. At least ei ght
manufacturers of cigarette machines, and
one firm specializin g in cigai; vendors, had
displays that do credit to the business.
While some of the firm s reported limited
production at present, they are all confident
that a full production rate will be main-
tained durin g most of the year. The metals
market is now becoming mu ch more favora-
ble and this will he] p all produ ction sched-
ules. National Vendors, Inc. will now pro-
duce its new electric console model in an
all-steel ca binet, wh en earlier ste ps had
contemplated a wood cabinet. Nation al re-
ported th at th e console will be in full
p roduction by late summ er.
A summary of th e plans and reports of
all of the manufacturers of cigarette ma-
chines indi cates a rising tide of activity, a
growin g stress on new and better machines,
all of it a sure sign tha t th e opera ting end
of the business is also in creasing its activ-
ity. Machin es th a t in any way cater to the
bi g auto touri st parade durin g th e summer
months are expected to show increased
busin ess.
Dwi ght Moody, writing in the Journal of
Commerce here, recently gave anoth er of
his interim reviews of the cigarette busi-
ness from th e angle of people wh o inves t in
th e stocks of the major cigarette ma nu-
fa cturers. Earnin gs of the major companies
this year will be near the 1948 level, he
says.
Main reason for th e continued high earn-
ings of the major cigarette companies is
that cigarette consumption is expected to
show fair gains over last year. Th e major
cigarette makers will al so have a full year
of th e hi gher factory price which was in
effect only half of last year. Hi gh cost of
tobacco is expected to be offset by th e
result of the price increase on cigarettes.
An echo of th e cigarette pri ce increase
was observed recently when th e list pri ce
of Camels was raised, by th e manufacturer
to the price level adopted by most firm s
last July.
Moody's review says th at the rate of in-
crease in cigarette use is still somewhat
greater than would be accounted for by
population in crease alon e, a very encourag-
ing fa ct. Population in crease in itself is
enough to kee p a slow rate of gain in
smoking in effect. More wom en smokers is
the most prolifi c fi eld for pointing national
sales still hi gher, th e experts say.
Th e major compani es bought considera-
ble suppli es of tobacco last year, at high
prices, but since tobacco stocks are aged
fo r two to three years the effect of high
tobacco costs is often distributed over a
long period. The major companies, in fact,
exp ect tobacco prices to decline on the
1949 crop.
Th e general increase in state taxes on
ciga rettes keeps th e consumer price trend
so definitely upward that th ere is no
thought of price declines on cigarettes at a
time wh en th e main topic of the times is
price reductions.
*
*
"I think I'll send my girl a bayonet, a
riA e and a sword."
"Is she collecting souvenirs ?"
"No, but she enjoys having arm s around
her."
COIN MACHINE REVIEW
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