"Competitors Should Be Hurt"

The price war, started by Manhattan's Macy's, took on a familiar look. In most instances, in skirmishes throughout the nation, it was simply a return to the loss-leader method of catching customers. In Akron, druggists made much of lopping 30% and more off the prices of such national brands as Ex-Lax, Anacin, and Drene shampoo, left other prices unchanged. One Atlanta jewelry store caught the fever, cut diamond prices as much as 50%. Even in New York City, the war had simmered down to smaller price cuts, usually in cheaper lines. But there were still flare-ups. Union Square's S. Klein cut men's suits and women's dresses, was swamped with customers. In eight minutes, Klein's sold 1,000 two-pants men's suits at $19.95. In half an hour, 2,000 women's dresses, cut up to 80%, were snatched from the racks. Said one store executive: "It's just as if the stuff fell through the floor."

While some manufacturers stopped sales to price-cutters, the Senate Small Business Committee announced that it would investigate to see if the price war had hurt small businessmen. Actually, it seemed to have hurt few, helped many. In the first week of the price war, New York retail sales had soared 25% above last year--and that included the thousands of merchants who had stayed on the sidelines. Said Secretary-Treasurer George A. Renard of the National Association of Purchasing Agents: "This talk about injury to a competitor is the biggest hoax and hooey . . . Of course, competitors should be injured; when they lose business it jars them into doing something about it, and that is what made our production and distribution methods the envy of the world."

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