Music Trade Review

Music Trade Review -- © mbsi.org, arcade-museum.com -- digitized with support from namm.org
THE MUSIC TRADE REVIEW
BUSINESS STABILITY AND PRICE MAINTENANCE.
(Continued from Page 3).
plan of cheap exploitation and unscrupulous merchants are forced to cut out their plan of substitu-
tion of cheap and inferior products for the standard articles.
In the recent Victor-Macy case the Court made the statement very plain that the Victor Co.'s
attitude in its licensed agreement with its representatives constituted no violation of the Sherman or
Clayton acts. The Victor Co.'s relations with its licensed representatives have worked out satisfac-
torily to all directly concerned, and that they have maintained stable conditions in the talking ma-
chine trade is admitted by dealers generally.
Neither is there the slightest doubt of the wish of the Victor representatives to continue along
the lines which have made for trade stability in the past.
Perhaps every contract which a producing house might make with its agents or licensees is in
a degree a trade restrainer, because it imposes certain conditions, but there is a vast difference be-
tween a reasonable and an unreasonable contract—a contract which insures stability of the prod-
uct itself and a guarantee to the purchaser.
In the talking machine trade it is universally conceded that the contractual relations which
have existed between the manufacturers, dealers and jobbers have been the bulwark of the indus-
try and have saved it at all times when there has been a severe strain or when there has been an
inclination on the part of some to dispose of talking machines at cut rates.
If the practice of price cutting on standardized articles be followed generally it would mean
nothing more or less than the ultimate driving out of industry standard names, or depreciating
them to such a degree that they would be unprofitable, because cut prices in the end can mean noth-
ing less than the lowering of a standard. Then the public will suffer materially, because certain
standards which formerly represented the highest type of workmanship, backed by the manufac-
turer's guarantee, would disappear.
Department stores are always fond of quoting in their cut prices the names of advertised stand-
ard articles and, of course, this is done for no other purpose than to attract persons to their estab-
lishments by giving the idea to purchasers that they are enabled to give lower prices on all their
goods and to prove their contention a standardized article is put out at a cut rate. It may be sold at
cost.
But right here is another element which may enter in as a regulating power between the pur-
chasers of standardized articles and price cutters, and which must become more or less acute as
time goes on. That is the new Trade Commission. It will be remembered that this commission is to
take cognizance of "unfair competition.'*
Now the question is, what is "unfair competition" if not the purchase of standardized articles
from irregular sources and advertising them at le>s than cost price?
Here is a chance to find out definitely just what that term means—"unfair competition."
Of course, some superficial thinkers will allege that price cutting on a trade-marked article will
injure no one, since the manufacturer got his full price from the original sale to the jobber and re-
tailer, and some say that the lowering of prices means a wider market.
To my mind this is a false reasoning, because price cutting in a general sense means the im-
pairing of the reputation of the article and a lessening of the reputation means a shortening of the
demand.
Price maintenance affords protection to the trade and to the public, and distributers and dealers
in the talking machine trade understand full well the truth of this statement, and there is no inten-
tion on their part to show disloyalty in their business acts. On the
contrary, as we view it, the licensed distributers of talking machines
will live up to their contractual relations in the strictest sense,
Obviouslv it is of distinct advantage to them to do so.
filled with good, vitalizing, up-to-the-minute copy, is sure to pro-
duce the best of business-building results.
LSKWHKRF in The Review appears a very interesting sum-
mary of the extraordinary authority and powers vested in
the Federal Trade Commission, which, as pointed out. well nigh
equals the Supreme Court in power, authority and dignity. It is
admited by those acquainted with the personnel of the Commis-
sion that its authority will be wisely and conservatively exercised.
The Commission certainly has at the present time a splendid
opportunity for the advancement, development and betterment of
all engaged in interstate trade. Instead of approaching in a cap-
tious and critical spirit, the solution of the difficult problems which
have confronted the business men of this country of late years, due
E
to doubts and ambiguities in existing law, the Commission can, by
approaching their solution in a calm, dispassionate and constructive
spirit accomplish results for American interstate commerce of un-
told value and practically to an unlimited extent.
This commission has in its power to remove doubts and diffi-
culties, which have hitherto existed, and establish constructive
precedence along uplift lines, so that the interstate business of the
country may be placed upon a sure, well defined and certain
foundation.'
The members of the music trade industry, in common with
all other industries of the country, extend best wishes for the suc-
cessful work of the Federal Trade Commission, and hope it will
mean much for the permanent advantage and profit of the business
of the countrv.