Hard$rood Flooring

Made with infinite care in a city noted the world, overl for its skilled woodworkers. All sizes t/s and, 13-16 in. stock.

Shipped in straight or mixed carlots with

NORTHERN AI{D SOUTI{ERN HARDWOOD LUMBER

The trademark EVERLASTING rtencited on tbc b""L" of each picce ir youi guarantce of quality in Lih drnrig and manufacture.

GALIFOR]I IA WH ITE

F;UL BUNYAI{ LATII, aheathing and lath combined in one piece. A p"tfec bond for rtucco. A solid iob of rheathing. One lesr item of material to buy. Reducec cost.

ANd SUGAR PIlIES

Building lumber and Finich. Factory Lumber. Pattern Stock. Wi& clean and uppers for drainbcrds and rhelv'

Siding and Moldingr, Lath and Shook.

The RED RIUER LUMBER G0.

MII.I.S & FACTORIES

WESTWOOD SALES CALIFORNI.A

Cut the "dicker" out

a lumber yard sells it is impossible to ald aJ/o to the purchase pricl, such as cement, plaster and many other items' it naturally follows that we must add m'ore than 4U/o to lh" oor"h"te Drice on some other items where it is possible ii *'. "t" to 6ring our average gross profit tp to-40/o ol the purchase prici, or 28/o of the selling price' Wit!^g; th,is average of 4O/c must be added if we are to make lo/o net of the sales.

- Now in the following I have tried to sepa:at€ the-items handled by a string of yards showing approximately the perce.ttaee possible- to add to each item leaving for the i"rt, plni.tt and Com'mon, to which must be added enough erois profit to bring the average up 6 4A/o of the purEh"..t. I'have takeln as a bisis forithe amounts the averase sales for each of our ya:ds of $15,900, and the proporti'onate amount of each iiem sold at the average yard is approxim,ately from m'eager data-which, we have' I have "ih"a less in percentage to Finish for the reason that the handling charge of Finish although more in dollars and "."t" p8t thou"sand is less in percentage than the handling ""a aiti"".y of Commott, a.td tecause competitive condiiions will not permit Finish, Flooring, etc' to carry the same percentage margin as Common.

Chart Iii

Cost of % Possible Gross Profit sold. to add. Possible.

Total Sales at Cost Price .$11,730.00 40% $4692.6

+The gross profit on lumber only was figured out backwards. ?rofit-possible on other lines handled was figured out. Then for-lurnber amounts of gross profit were comouted which would be necessary to brin'g the total gross Lrofit up to 4CIVo of the cost price 'of goods sold' Please inderstind that the proportion of sales is approximated and likewise the percentage possible to ,add is.approximat;J. Sash and doors you will note are l5/o which is^higher than the lumber deaier margin in Los Angeles' Outside Los Angeles somewhat lar'ger margin is possible'

Over 2(X),0O0,(X)O feet ennually. Continuoru year'rorurd production

From this you can see that either Common lumber or some other item handled m,ust carry the ,load of getting more than the 4A/o,in order to bring the average gross profit up to 4O/o of cost of goods sold' In the following Chart I-have tried to take the market of to-day, and added freight, wharfage and the percentage required to be added as determined by Chart No. 3. This determined the average price which we should be obtaining for our good's, not the lop price but the average price. These are all based on Loi Angeles freight and with them I have set up for comparison the present Los Angeles prices.

Compare the amount to be added to Com.mon Fir with the $12 per M. which some consider as their cost from ship's taikle to the job. Including wharfage a1{ trgt_S!! oui figurer indicated $18.25 should be added of which $5.00 is to be net profit. This seems to indicate our cost to be $13.25 from ship's tackle to job. Of course we try to make Common lumber help some other items such as Cement and Plaster 'over the grade. You can readily see that at present we are hardly getting replacement cost out of the Co-m,on we are selling when you consider our cost of do' ing business. Buying inferior grades helps not at all when you consider the increased loss of merchandise, loss of prestige, expense of ripping and fall .down, and the lower price necessary to move it. If it did help we would all buy No. 3, the price would go up (for the p'rice is det_ermined by supply and demand, mostly the latter) ryd I smaller differential m,argin between Common and No. 3 would result. The supply of No. 3 is more or less fixed and limited. Therefore, the price is almost altogether determined by demand.

Now you rnay say that you have no Head Office 'Expense. Perhaps not, but you do have expenses which_coriespond to expenses we meet'out of our Head Office' Take thi Income Tax alone. Do you realize that if you make