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6
THE
MUSIC TRADE
REVIEW
MARCH 28, 1925
The Trade-in in Radio Merchandising
Growing Tendencies Among Radio Prospects to Demand Allowances on Old Sets in the Purchases of New
Ones Being Noticed in Retail Trade—Obsolete Sets Usually Offered Have But Little Resale Value
at the Present Day—Methods by Which Trade-ins Are Being Avoided
VIDENTLY the question of the trade-in
is beginning to enter the retail merchan-
dising of radio. Reports from a num-
ber of retail music dealers in the Metropolitan
District, who maintain radio departments, state
that there is a gradually growing number of
people who desire allowances on their old sets
when purchasing a new one, either because
they desire a more modern type or a more ex-
pensive one. It is a situation which warrants
careful thought, especially on the part of the
music merchant who has had experience with
the trade-in in the other lines of merchandise
which he handles and who knows the trouble
which always follows in its wake. The solution
of course is one of expediency, but, with con-
ditions as they are to-day, the music merchant
who goes into trade-ins is flirting with danger
of an eventual loss on every sale of this type
which he takes.
Who Encourages Trade-ins
The trade-in has been encouraged by a cer-
tain type of smaller radio dealer who is adver-
tising that allowances will be made for old sets
on the purchases of new ones. These men
have a certain market for second-hand sets,
but it is not one that the music merchant can
enter with any degree of success. Even they,
however, are creating a difficult situation for
themselves, due, of course, to their lack of
experience in selling merchandise of the spec-
ialty type, under which heading radio certainly
falls.
One music merchant, in speaking of this
condition, said to The Review representative:
"It is true enough that we are getting a cer-
tain number of requests for trade-ins. As yet
we have complied with none of them, outside
of certain specific cases where the original in-
strument has been purchased from us within a
period of six weeks to two months. In such
cases we have made allowances when the cus-
tomer wished a more expensive set, allowing
nothing however in the case of the accessories.
We have no trade-ins at all on sets that have
been out for a longer period than this time, nor
on sets which have not been purchased from us
in the first place. The cases where we have
allowed trade-ins have been so few that we
have no trouble in disposing of the old sets, as
they appeal to certain types of customers who
are out for bargains at any price. But the older
set has no market as far as we can see, and
trade-in allowances upon it in our view are
nothing more or less than a concealed price
cut."
Other merchants interviewed took largely the
same viewpoint. Most of them stated that if radio
had reached the point of stabilization of design
that exists in the musical instrument field,
there might be some reason for the trade-in,
but with the constant development of new
types and the changes which take place an-
nually, the obsolete set is a drug on the mar-
ket and cannot be resold at a price that will
warrant the overhead involved in the transac-
tion. Furthermore, servicing charges on such
sets, for they must be sold with some sort of
a guarantee, make a continuous drain of ex-
pense. Several dealers, who had experiment-
ed to some degree with the radio trade-in, were
much more emphatic in pointing out these facts
than those who had not yet been confronted
with th'e situation, one of them stating that in
two cases he still had the receivers on hand,
and that, as far as he could see, they were
likely to stay there.
One music merchant in Newark, N. J., in dis-
cussing this situation, said that he had had
E
several such requests, but that in most cases
he had succeeded in turning them into sales
by tactful handling.
"When a customer comes into the store and
wants to trade-in his old receiver on the sale
of a new one," he said, "I have found that the
following policy usually works. As soon as
it becomes apparent that the customer will not
consider the purchase of a new set outright,
we endeavor to discover how well the old set
is performing. In most cases, the customer
agrees that it is giving him good service and
that the desire was largely only for a newer
model. Then we endeavor to sell him a modern
type of loud speaker, or a set of storage B bat-
teries, or some other accessories which will
bring the set more up-to-date. In some cases
we have even gone so far as to send out our
service man to look it over, and, in every case
we have done that, we have sold enough mer-
chandise to the customer that more than war-
ranted the time he put into it.
"The reason we are so against the trade-in
is to prevent the customer from getting the
idea that he should have a new set every year—
a condition that used to exist in the automo-
bile trade. Once the radio owner gets that
idea, we are going to be piled up with old
models that we will only be able to clear at a
loss, and the margin in radio won't permit that.
The time to stop that is right now, and the
retail merchant is the only man who is going
to stop it."
As a matter of fact customers who come into
the warerooms insisting on a trade-in should be
told frankly that improvements in radio cir-
cuits during the past twelve months have been
generally negligible, and that changes in models
have been largely refinements. This statement,
and it is a true one, is the real basis of han-
dling the trade-in problem.
Another merchant, in discussing this question,
said that so far as his type of customers were
concerned a majority of those who desired a
trade-in deal wanted it because they were not
satisfied with the appearance of the set in the
home. To meet this objection he has taken
a line of cabinets which he sells to such cus-
tomers who find that this is the most inexpen-
sive way of meeting this objection. Of course,
it requires salesmanship to do it, but then
salesmanship is always necessary to meet any
ticklish situation in retail merchandising.
The trade-in is a decided evil in any line,
but it is worse than that in retail radio selling.
If the public becomes educated to the radio
trade-in, the music dealer, who to-day is the
largest seller of quality radio receivers, is going
to be the heaviest sufferer. Therefore they
must do all in their power to nip the matter in
the bud, they must fight it now when it is
just beginning to make its appearance. .The
idea has been fostered by the "gyp" dealer in
his present struggle for existence. Let him
have that business—he may think he is trim-
ming the public, but he is more likely to be
trimmed himself, for the public will soon learn
if the reputable dealer refuses it.
New Brunswick Plan for
Bait Advertisers Are
Building Gold Label Demand
the Trade's Parasites
Sample Records Will Be Sent to Those Whose
Names Are Furnished to the Company by the
Dealer—Should Develop High-class Trade
The Brunswick-Balke-Collender Co., Chicago,
has provided for its dealers an interesting plan
whereby Brunswick Gold Label records record-
ed by artists of the New Hall of Fame can be
brought directly to the attention of the dealer's
prospects at a minimum of expense.
Under the plan the dealer is asked to turn
over to the company a selected list of record
buyers who might be expected to be interested
in records of the-Gold Label type. To each of
the customers on the list there will be sent a
Gold Label record with the compliments of the
Brunswick Co., accompanied by a personal let-
ter stating that the record is sent at the sugges-
tion of the local dealer. The customer is asked
to acknowledge the sample records and these
acknowledgments will be turned over to the
dealer.
The only expense of the dealer beyond that
of preparing the list, which is negligible, is a
charge of fifteen cents for each record sent to
its customers, thereby representing a most eco-
nomical and at the same time impressive
method for getting an actual sample of the Gold
Label Records into the customer's hands.
Steadman to Move
YONKERS, N. Y., March 24.—Frank Steadman,
proprietor of Steadman's Music House, at 45
Warburton avenue, has just taken a lease on the
store at 24 Main street, and will remove his
business to this address about June 1. Stead-
man's Music House has been located at the
Warburton avenue address for the past eighteen
vears.
{Continued from page 3)
player-piano. If there were not such a belief
already built up in the community mind, the
man who does rotten retailing would be unable
to do anything at all. So he commits a double
sin. He cheats the public and at the same time
he robs every decent man in the trade who is
within his sphere of influence.
Probably it will never be possible entirely to
eliminate the cheaply selfish man from the
music industries; but something will have been
accomplished when every other man in those
industries realizes that advertising by selfish
men based upon the appeal to pure selfishness,
to the "something-for-nothing" streak which is
in us all more or less, is actually destructive;
and that more can be destroyed in a week of
such advertising and practice than can be built
up in a year of honest constructive sales work.
When decent men realize that their position is
thus being steadily undermined, they will per-
haps wake up. Meanwhile, words such as
these, analyzing the situation from unexpected
points of view, may have some effect of their
own.
New Store in Portage
POKTACK, PA.. March 23.—E. H. Hegelman, of
Derry, PH., has recently opened a new music
store in the Ratz and Gerber Building on Main
street. He handles pianos, players, small goods
and phonographs as well as maintaining a re-
pair department for .the latter instruments.
A charter of incorporation has been granted
recently to the Hardtke & Hessel Music Co.,
of Manitowoc, Wis., which will have a capital
stock of $15,000. The proprietors are Arthur
H. and Edith Hardtke and Reinhardt G. Hessel.