From the Rolls-Royce experimental archive: a quarter of a million communications from Rolls-Royce, 1906 to 1960's. Documents from the Sir Henry Royce Memorial Foundation (SHRMF).
Article on the 1928 used car market and sales predictions, alongside a second article urging for more effective automotive catalogs.
| Identifier | ExFiles\Box 128\1\ scan0045 | |
| Date | 11th February 1928 | |
| 190 CAR LIFE Automotive Industries February 11, 1928 signs of wear it is now possible, due to the multiplication of refinishing stations, to obtain a lacquer finish hardly distinguishable from new and at a comparatively insignificant price. The heavy depreciation in used car values that went on in the last two years is another factor that makes owners reluctant to trade for new cars. This depreciation was forced by the decline in new car prices and the trend will be accentuated in the early months of this year if the price cuts of the last month or two have the accustomed effect. Calculations of car life do not enter quite so intimately into plans for automobile production as they do into tire output, for reasons easily discernible. Tire sales are largely based on a replacement market which can be very closely estimated provided the average life of the tire remains constant. People will be disinclined to buy new cars if business is poor or other restrictive factors are present, but they will continue to run cars about as much as ever and to need as many tires. Yet so long as financial and industrial conditions are sound, automobile companies in the main count on a very large replacement business, which has been calculated as growing very rapidly toward an approximate peak not many years hence of perhaps 4,000,000 cars annually. Something of this sort will undoubtedly happen eventually; the only point on which plans can go wrong is the rate of gain. The whole problem, then, is whether the current replacement market is as large as has been generally considered, or, viewed in another light, whether the expected number of owners are willing to turn in their comparatively new cars for the 1928 products of the industry. Perhaps it will be argued that the question is not really so important—because if enough sales pressure is applied a record, or close to a record, number of new cars can be sold despite reluctance to trade on the part of the public. The confident predictions of factory executives at show time, together with the heavy production schedules under way, make it plain that the stage has been set for a year approximating the best the industry has had. But if a real buying demand is not available, formed by owners willing to accept sacrifices on their used cars, records can only be achieved by the sort of sales pressure that bears heavily upon the dealer organization, which, to all appearances, is ill prepared for further trading losses. Whether or not it is just to say that dealers generally are “loaded” with used cars the fact is that the retail organization would be much better off with fewer used cars; and a further fact is that most of these used cars were acquired before price cutting on new cars brought the need for further depreciation of used car values. A manufacturer interested in improving the stability and enhancing the prosperity of his dealer organization in 1928 will want to know, primarily, how many cars can be sold without forcing the market. More Effective Automotive Catalogs Urged THE variation in practices concerning the publication and distribution of catalogs, together with the wide dissimilarity in costs for comparable printing and mailing jobs, would seem to indicate the need for more study by automotive manufacturing executives of this important item of sales expense, according to a survey recently made by the Motor & Accessory Manufacturers Association in cooperation with the Chilton Class Journal Co., publisher of Automotive Industries and other automotive trade papers. The survey did not depreciate the value of catalogs as part of a distribution program, but it did indicate that more effective material in some instances could be included. The lack of knowledge of catalog practices revealed by some executives who replied to a questionnaire on the subject might be interpreted as showing that too much of this important work was left to subordinates. In reply to the questionnaire 43 companies gave comparable information. The average company was distributing 45,000 catalogs a year at a cost of $18,000. The 30 manufacturers selling both to manufacturers and the trade were distributing on the average, 55,000 catalogs each, at an approximate cost of $19,000 per year. Five manufacturers selling only for original equipment were circulating, on the average, 13,000 catalogs, at an average cost of about $12,000. Another group of eight manufacturers having no original equipment business, that is, selling only to the trade, were issuing approximately 33,000 catalogs each, at an average yearly cost of $7,000. While the M.{Mr Moon / Mr Moore} & A.{Mr Adams} M.{Mr Moon / Mr Moore} A.{Mr Adams} was making this study, the Chilton Class Journal Co. made an inquiry relating to the use of catalogs in the trade. A questionnaire was answered by 200 wholesalers, indicating a heavy waste in catalogs, while a similar condition was shown by another survey which covered 100 repair shops, including a good many car dealers, and 25 accessory stores. The inquiry among wholesalers revealed the following facts: 30% file less than one-half the catalogs received. 10% do not keep an indexed file of catalogs. 40% find it difficult to keep catalogs filed for various reasons, among them miscellaneous sizes and shapes, quick obsolescence of products and prices, and difficulty in cross-indexing contents. 46% carry 100 or less catalogs in file. 38% carry 100 to 500. 16% carry more than 500. 19% state that information in catalogs is insufficient. 75% indicate that they would prefer a condensed, general catalog in one or a few volumes, instead of numerous individual catalogs. The questionnaires returned by repair shops and accessory stores indicated the following facts: 38% of the repair shops and 64% of the accessory stores do not keep an indexed file of catalogs. 48% of the repair shops and 64% of the accessory stores file less than one-half of the catalogs they receive. These merchants found it difficult to keep catalogs filed for reasons similar to those stated by the wholesalers. 75% of the repair shops and 80% of the accessory stores have 50 or less catalogs on file. Virtually all of the repair shop and accessory store proprietors wanted condensed, general catalogs. | ||