Crimson Presents Analysis of The New Harvard Square Business War

Indications are this year that the laundry and pressing situation will be more complicated than ever, with new groups crowding into a field already characterized by fierce competition.

The Undergraduates' Laundry which last year divided the sphere formerly occupied by the Students' Laundry and pressed the latter organization hard, now finds itself in competition with three new student enterprises. College Service and the Student Enterprise are two new competing organizations which offer a variety of services but which depend chiefly on laundry and pressing, while a third group, the Students' Discount Society, will offer considerable but less definitely direct competition.

Although the new organizations are composed of students, none of them is strictly speaking a 100% student enterprise, because the actual work of producing laundering and pressing service will be done by regular commercial organizations. The student groups act as selling agents for these houses and depend for their profit upon a sales commission.

It is predicted that the effect of the stiff competition among these groups will tend to force prices down in an era of generally rising prices. Observers believe, however, that this will not have the effect of giving Harvard men the benefit of continued very low prices, because the profit to the student organization is practically entirely in the nature of a sales commission, and the lower the basic prices go, the smaller becomes the margin available for commission allowance by the commercial house actually producing the service. The ultimate effect would be to make the field unprofitable for student organizations, with consequent lessening of competition and a corresponding rise in prices. But in the meantime, indications are that there will be a stiff fight for every student shirt or pair of trousers to be laundered or pressed, with the possibility of harm to the capital investment of student entrepreneurs who have entered these fields in which competition is apparently uncontrollable.

The newest type of organization, the Student Discount Society, has not yet publicly announced its aims and scope, but it is apparently based upon a mutual organization of merchant members and student members and is aimed at the membership and dividend scheme of the Harvard Cooperative Society. The merchant members will give a 10% discount on purchases made by students who have paid one dollar for a membership card. A certain percentage of the income from the sale of the membership cards is to be used for publicity purposes for the merchants who are members of the Society. However, it is not yet known how fully the merchants organization covers Harvard Square, nor upon how many items of stock the merchants will offer the discount. Persons familiar with the Harvard Square trade have expressed the opinion to the CRIMSON that the list of items upon which discounts will be given will be so limited by the number of items upon which manufacturers insist upon obtaining published retail prices, and also by those in which the margin of retail profit is already small, that the service will not be entirely satisfactory to student members.

Furthermore, it was pointed out to the CRIMSON by some merchants that if a cooperative organization such as the Harvard Cooperative Society cannot offer higher dividends than seven and nine percent, and if the huge cash store of R. H. Macy & Company in New York cannot promise better than a six percent advantage over other department stores, is is not very likely that any one merchandising group like that in Harvard Square can offer a flat 10% discount on sales, particularly as these stores have to pay a return to the owner, a condition which the Harvard Cooperative Society does not have.