Mens Sewed Straw Hats | Page 8

proper share of the total selling expense. Firms organized to deal directly with retailers uniformly had higher selling expenses than those whose products were marketed chiefly through jobbers. The average selling expense of the selected hats was $1.64 per dozen, or 10.8 per cent of the average manufacturing cost. In selling expense is included the charge for cases and other packing material.
(b) Foreign.--Costs of selling hats to importers in the United States are included in the general overhead expenses reported by foreign companies, but are an inconsiderable item when compared with manufacturing costs. No expenses of the offices maintained in this country by foreign manufacturers have been included.
TABLES SHOWING COST COMPARISONS
In Table 8 are shown the costs of domestic and Italian men's sewed straw hats, irrespective of the type of braid used in their manufacture. In Table 9 are shown similar cost data for domestic and English hats. In both tables costs are shown with and without transportation charges on foreign hats, and ad valorem rates of duty necessary to equalize differences in foreign and domestic costs have been computed.
TABLE 8.--Rates of duty necessary to equalize differences in costs of production of men's sewed straw hats in the United States and in Italy, the principal competing country
-------------------------------------------+-------------+------------ Item | Domestic[1] | Italian[2] -------------------------------------------+-------------+------------ (a) Cost (transportation not included): | Per dozen | Per dozen Material cost | $6.44 | $4.35 Labor | 4.60 | .87 Overhead | 1.70 | .76 +-------------+------------ Total manufacturing cost | 12.74 | 5.98 +=============+============ Difference | | 6.76 Foreign valuation[3] | | 6.42 American selling price[4] | 13.28 | | | Ad valorem duty necessary to equalize | | on basis of-- | | Per cent Foreign valuation | | 105 American selling price | | 51 +=============+============ | | (b) Cost (transportation on Italian | | hats to New York included): | | Per dozen Total manufacturing cost | 12.74 | $5.98 Transportation to New York--Inland | | freight, ocean freight, marine | | insurance, consular fee | | 1.10 +-------------+------------ Cost, including transportation to | | New York for Italian hats | 12.74 | 7.08 Difference | | 5.66 Foreign valuation[3] | | 6.42 | | Ad valorem duty necessary to equalize | | on basis of-- | | Per cent Foreign valuation | | 88 -------------------------------------------+-------------+------------ [1: Average costs of 15 domestic hats selling to jobbers at $10.55 to $15.52.] [2: Average cost of 15 Italian hats whose imported cost plus duty ranged from $8.51 to $13.10.] [3: Average of wholesale selling prices reported by foreign manufacturers.] [4: Average of wholesale selling prices to jobbers reported by domestic manufacturers.]
TABLE 9.--Rates of duty necessary to equalize differences in costs of production of men's sewed straw hats in the United States and in England
-------------------------------------------+-------------+------------ Item | Domestic[1] | English[2] -------------------------------------------+-------------+------------ (a) Cost (transportation not included): | Per dozen | Per dozen Material cost | $8.34 | $5.47 Labor | 5.85 | 1.84 Overhead | 1.87 | 2.01 +-------------+------------ Total manufacturing cost | 16.06 | 9.32 +=============+============ Difference | | 6.74 Foreign valuation[3] | | 9.73 Ad valorem duty necessary to equalize | | on basis of-- | | Per cent Foreign valuation | | 69 +=============+============ (b) Cost (transportation on English hats | | to New York included): | | Per dozen Total manufacturing cost | 16.06 | $9.32 Transportation to New York--Inland | | freight, ocean freight, marine | | insurance, consular fee | | 1.35 +-------------+------------ Cost, including transportation to New | | York for English hats | 16.06 | 10.67 Difference | | 5.39 Foreign valuation[3] | | 9.73 | | Ad valorem duty necessary to equalize | | on basis of-- | | Per cent Foreign valuation | | 55 -------------------------------------------+-------------+------------ [1: Average costs of eight domestic hats selling to jobbers at $16.74 to $22.50.] [2: Average costs of eight English hats whose landed costs duty paid ranged from $15.64 to $18.60.] [3: Average of selling prices reported by foreign manufacturers.]
COMPETITIVE CONDITIONS
Styles for men's straw hats are set about one year in advance. Sample hats are manufactured in May and June and orders are taken by manufacturers in July, August, and September for hats to be delivered the following spring. This custom of the trade makes it possible for foreign manufacturers to copy and offer in competition the same styles as those made by American manufacturers. Imported hats have a wide range of styles and prices, including not only sewed hats of sennit braid but also those of fancy braids, and woven body hats such as leghorns. Domestic hats also comprise a wide range of styles and prices. Within this range there is a more or less definitely limited field in which imports compete directly with domestic merchandise.
TRANSPORTATION AND MARKETING COSTS
Before the Italian or English hats enter into competition in