On studying the various phases of city apple marketing, special attention was given to retail methods and costs. The purpose of this study was chiefly to learn whether the wholesale supply controls the price. The cost of operation as a factor in determining retail prices also was investigated as far as possible.
Retail apple distributors may be classed as follows:
(a) Fruit-stand vendors.
(b) Fancy grocers, fruiterers, etc., catering almost exclusively to high-class or fashionable trade and doing a very extensive credit business.
(c) Grocers catering to a cheaper class of trade, largely upon a cash basis.
(d) Hucksters or street peddlers.
Relatively high prices were charged for apples purchased at fruit stands. Extra fancy Northwestern and Colorado Jonathans were sold to the dealers during October and November at prices ranging from $1 to $1.25 per box. Apples which grade 150 to the box retailed at two for five cents, or $3.75 per box. This meant a gross profit of about 250 per cent. In the ninety-six size, extra fancy Jonathans sold at three for ten cents, or $3.20 per box, showing a gross profit of about 200 per cent.
In the East Side tenement section of New York City it was learned that by reason of the cheap prices prevailing and the heavy supply of apples arriving the peddlers were operating to the detriment of fruit stands. The fruit-stand dealers were selling only about one-third to one-half the quantity of fruit handled in former seasons. The pushcart and wagon peddlers as a rule buy packed or loose fruit cheap and go direct to the homes of the residents, selling at prices considerably below the fruit-stand men. The peddlers handle a large quantity, make quick cash sales, and pay no rents. Other dealers incur heavy operating expenses and generally sell not for the purpose of moving a large quantity, but for the highest price obtainable. Consequently, the movement is restricted.
The largest profits were found usually in barreled apples. For instance, New York B grade, two inches minimum, approximately 600 apples to the barrel, sold for a cent each or $6 per barrel. These apples cost the retail dealer not over $2 per barrel delivered to his store, allowance being made for jobber's profit and drayage. The investigator saw "A grade" fruit, 2-1/2 inches minimum, averaging about 400 apples per barrel, which cost the retailer not over $3, being displayed for sale at two for five cents, or $11.25 per barrel. Such prices prevailed at no less than twenty-five retail stores visited in one day. Apples were being offered for sale at retail all over New York City at prices ranging from one cent each at the cheap corner fruit stands, to fifty cents and eighty cents per dozen at the fanciest fruit stores.
In general, it may be said that the gross profits of fruit-stand vendors range from 100 to 250 per cent. Operating expenses other than rent in most cities except New York are not relatively high and all sales are on a strictly cash basis; hence the net profits on good fruit are large.