Coin Machine Review (& Pacific ...)

1948 exports of coin machines was released
late in March and is considered encourag-
ing in view of world conditions_ Canada
relaxed its import restrictions on a number
of items, April 1, and the coin machine
trade is hoping for favorable action this year
on its products_ One trade paper points out
that the Department of Commerce report
shows nearly 3,000 coin machines going
into Canada-when such imports are sup-
posedly banned_ Trade gossip has buzzed
for some time with reports of machines
going to at least two countries that ban
them. One particular point buzzes with re-
ports that many other types of banned
goods than coin machines are crossing over.
But perhaps these things should have been
kept quiet.
Canada's money position is improving
fast and a big International Trade Fair
will be held in Toronto, May 30 to June 10.
Reports on money conditions in most other
countries do not show any definite trends
toward the favorable side.
FREIGHT - Freight car loadings have
declined and are regarded as an important
sign of business conditions; experts predict
further declines in second quarter. In the
general discussions on freight rates and the
basing point system, the National Food
Brokers Assn. strongly condemned efforts
to restore the old basing point price sys-
tem because it would injure small business.
This was ' the first definite move made by
any group representing small business in-
terests. Current business reports emphasize
the big inroads trucks have made on rail
freight.
GASOLINE-The gasoline price situa-
tion has been moving in a dizzy whirl re-
cently. Gasoline stocks are at a record high
but early in April price increases were an-
nounced in various sections, said to be due
. to fact oil companies are not making a
profit on gasoline. While big oil companies
were hiking prices, service statio ns in some
areas were said to be having a price war.
Some producing areas have reduced output
to maintain prices. Outlook is that summer
tourist travel will determine whether gas
prices rise further during the year; some
think widespread price-cutting will show
up in the summer. Here's how world condi-
tions affect the coin machine trade: oil
industry in U. S. insists on cutting imports
During Twenty-Two Years
of Leadership
of oil from South America, which means
the chief source of dollar exchange for
South American countries is n6W being cur-
tailed. It will show up in exports of coin
machines later.
MATERIALS- The biggest development
in the entire business picture recently has
been the break in metal prices, including
even copper. Such a break is classed as a
"soft spot" in the national picture, but it
is a thing that had to come if high prices
are to come to an end. Many manufactur-
ing industries will gain in the long run by
lower prices on steel, copper, etc. The gray
market in steel has vanished. Many grades
of lumber declined in price some time ago.
Demand for steel and other materials is
tending downward.
POWER-Use of electric power is show-
ing a downward trend, said to be a sign
of a declining industrial output.
PROFITS-By April 1 reports were in
to give a true picture of business profits
last year. Industry's earnings rose about 23
per cent in 1948 over a previous year; oil
companies had a gain of about 66 per cent;
the sugar industry had a declining rate of
profit; auto industry had a 45 per cent rise;
the railroads had a 37 per cent increase in
profits; the steel industrv had a 33 per
cent increase; the tobaccG mdustry had an
increase of about 19 per cent. One survey
shows 3,262 corporations h'aving an average
increase in net earnings of 22 per cent over
1947, but lower earnings were reported by
37 per cent of the firms. Among manufac-
turing firms, 42 per cent had declines in
their net compared with 1947_
Business Week said recently: "Last Year
was Tough for Small Business; Excellent
for Large Firms."
PRODUCTION - Industrial output de-
clined generally since last November, but
the National Assn. of Purchasing Agents
reported for March that production rate is
now being maintained and 16 per cent of
the firms reporting show increases in out-
put. Manufacturers' sales declined more
than seasonally in February. Backlog or-
ders held by firms are said to be 20 per cent
off .from a year ago. Experts say total out-
out of goods may drop 10 per cent by mid-
1950; the total leveling off of business
volume will run 10 to 15 per cent in that
neriod_ they estimate.
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PRICES- Biggest downward trend thus
far is presumably in foods; recent break in
metal prices is an important link in the
general decline of prices. Consumer resist-
ance is pictured as still "wearing down the
price level," rather than any decided price
breaks. Manufacturers are also resisting
prices on raw materials, so price resistance
is a pretty widespread practice. Some ex-
. perts say consumer demand will decide fu-
ture price trends, rather than any props
under prices. The April to June period is
expected to show wider price declines than
the first quarter. Such things as real price
boosts are now over; the trend is down-
ward. Manufacturers say costs are holding
steady while they have to sell at lower
prices.
RETAIL TRADE-One big retail or-
ganization warns that retail sales have de-
clined to the danger point between profit
and loss. Final reports on Easter sales were
not available at this time but they were
not expected to make up for recent de-
clines. Retail trade has been on a general
decline since last August but total volume
is still very high, and towers like a moun-
tain above prewar trade. The stores are
worried about price resistance and also
about the possibility that a general decline
in sales may continl:1e over a long period.
If trade could level off at present mark,
the volume would be tremendous. Such
popular locations as gas stations, eating
places and taverns have had a period of
decl,i nes; drug stores show a trend to hold
at a stable level; gas stations did report
slight . gains in February. But predictions
are that gas stations, taverns, eating places,
candy stores and maybe drug stores should
prepare for declines during the year.
TOURIST TRADE-Predictions by
financial papers are that more people will
travel in cars this coming summer but that
A1tey will spend less than ever, even resist-
ing prices on gasoline to the point that oil
companies may be compelled to cut. One
prediction is that 60 million people this
summer will vacation in 20 million cars,
spending an average of $100 per person.
WAR AND DEFENSE-Time is slowly
wearing down the people's fear!;' of war and
agitation is also losing its power. More op-
position to defense plans is appearing in
Congress. The .s pring months should tell
the story, if Russia plans to offer any real
opposition; otherwise, the year should grow
more quiet. Government and business lead-
ers now grow more concerned about spend-
ing for defense, for European aid, etc.
Spending for the vast defense programs is
one of the biggest props to business, and
if it weakens this year it will speed deRa-
tion all the more.
Big concern now in high circles relates
to plans to slow up the downward trends
in b.u siness; most plans call for more gov-
ernment spending; some leader~ boldly say
industries should not layoff workers and
cut production when prices begin to slide;
the shorter work week will be urged as a
way to give jobs to more people. Increased
government spending will go either for big-
ger and faster defense plans, or for public
works. The odds are that during this year
defense plans will be stepped up, including
bigger armed forces. But by next year a
gigantic public works program may be get-
ting into action.
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COIN MACHINE REVIEW