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In the fifty years between 1870 and 1920, the cost of distributing the necessities and luxuries which we consume has nearly trebled, while the cost of producing them has been reduced by more than one-fifth. If the cost of distribution continues to rise at the same rate, before the end of the next fifty years, we shall have more people engaged in the work of distribution--selling, advertising, delivering, transporting, etc.--than we shall have in the work of production, than we shall have occupied in farming, stock raising, lumbering, mining, and manufacturing.
It is evident that what we are saving through the lower costs of modern methods of production, we are losing through the higher costs of modern methods of distribution. The question is, "What can we do about it?"
To answer that question constructively, I have found it necessary, first of all, to make a critical analysis of the distribution elements of the consumer's burden, and to direct attention to certain facts in connection with the marketing and distribution of the products which we consume, the importance of which has not been generally recognized. Most of these facts have to do with what I call physical distribution and "high power" marketing--the transportation of raw materials and finished products, and the methods of selling, advertising, and financing, which manufacturers today use in an effort to keep their factories "sold up" to maximum capacity of production.
The first and second parts of this book are devoted to this analysis of modern methods of distribution. This study makes it plain that only about one-third of the consumer's dollar spent at retail is paid for production while two-thirds is paid for distribution. What will perhaps be most surprising to those who have made no study of this subject, this study reveals that it is the manufacturers rather than the retailers and jobbers who get the most of what the consumer pays for marketing and that they are principally responsible for the extravagances with which modern distribution abounds.
The third and fourth parts of the book represent an effort to suggest what consumers, retailers, jobbers, and manufacturers can do in order to lower the cost of distribution. These two parts contain suggestions upon which individuals can act immediately--suggestions by which they can make their power as buyers the directing force in regulating the activities of every manufacturer, wholesaler, and retailer. But they also contain suggestions of an even more far-reaching nature--suggestions which should not only result in lower costs of distribution, but which contain the possibilities for very considerably improving the conditions of living and the cultural level of mode society. Unless the more prosperous consumers of the nation can be persuaded to turn themselves into gourmands, clothes racks, and gasoline-eaters and to devote their lives largely to the consumption of the endless quantities of things which mass production is evoking, we shall have to give a thought to the problem of enabling the poorer sections of society to live as comfortably as industrial progress today makes it possible, as well as to the problem of making it possible for most of us to live richly and beautifully in spite of the imperative need of consuming all that our production machinery is capable of producing.
RALPH BORSODI
PART I
THE COST OF DISTRIBUTION
III THE RISE IN THE COST OF DISTRIBUTION
V THE CAUSES OF THE RISE IN DISTRIBUTION COSTS
VI THE COST OF PRODUCTION AND DISTRIBUTION
VII THE RISE IN THE COST OF PHYSICAL DISTRIBUTION
VIII THE RISE IN THE COST OF MARKETING
IX THE RISE IN THE COST OF MERCHANDISING BY RETAILERS AND JOBBERS
PART II
MARKETING A LA MODE
XVII HIGH PRESSURE CAPITALIZATION
PART III
THE IMMEDIATE PROBLEM
XVIII THE ELIMINATION OF HIGH PRESSURE MARKETING
XXI USELESS VS. USEFUL ADVERTISING
XXII QUALITY LIKE CHARITY COVERS A MULTITUDE OF SINS
XXIII HIGH PRESSURE MARKETING IS NONESSENTIAL
PART IV
THE ULTIMATE PROBLEM
XXV THE CREATION OF CONSUMER DEMAND