Gum for Cotton

On Palm Sunday big, breezy William Wrigley Jr., Chicago gum tycoon, got an idea about cotton. On Monday he developed it. On Tuesday he announced that his company would (in effect) barter gum for cotton in the south, would use all sales receipts in that territory to buy up to 100,000,000 Ib. (200,000 bales) of cotton during the next eight months. The market price would be paid, provided it did not exceed 12-c- per Ib. Last week in the spot markets of the South cotton was selling around 10-c-.

It was not the first time Mr. Wrigley had had his idea. In 1914 when cotton dropped to 5-c- he stepped in as a cotton purchaser with his Southern sales receipts. The War started cotton on its historic climb to 40-c- per Ib. Mr. Wrigley sold without loss (he has never admitted making a profit). Again last December he announced the same barter plan for wheat in the Canadian provinces of Manitoba, Saskatchewan and Alberta. His company promised to buy out of its sales receipts 1,000,000 bu. at not more than 65-c- per bu. By last week 500,000 bu. had been thus purchased at an average price of 55-c- per bu. Meantime Wrigley gum sales in the region have increased 10%. Delighted Wrigley officials plan to continue the wheat scheme all this year.

Last week's Wrigley cotton plan, which its author worked out with characteristic speed and precision (including publicity by great J. Walter Thompson Co.), works as follows:

Wrigley gum jobbers in Texas, Louisiana, Arkansas, Oklahoma, Mississippi, Alabama, Georgia, Tennessee, Kentucky, North & South Carolina, instead of remitting their receipts to Chicago headquarters will deposit them in designated banks in New Orleans, Savannah, Memphis, Mobile, Charleston, S. C. With these deposits the banks will buy cotton under 12-c- per Ib. for December delivery. Wrigley gum sales in this southern area run about $12,000,000 per year, all of which Mr. Wrigley is ready to invest in cotton and leave in the South. If the South buys enough Wrigley gum, the company will be able to purchase its 200,000 bale quota. If gum sales slump, less cotton will be taken off the market. If during the plan's operation cotton goes above 12-c- per Ib. the Wrigley company will withdraw as a buyer and sell at a profit. If the market falls below current prices, it will use its cotton for packing instead of excelsior.

Mr. Wrigley called his cotton plan a "sincere and friendly gesture to the South," which he is said to love because he used to travel through it as a drummer. Cotton traders agreed that it was a gesture, not a cotton speculation, because 200,000 bales would be too infinitesimal a quantity to affect the broad price of a crop that runs into 13 or 14 million bales. And for a shrewd piece of publicity to boost Wrigley sales in the South, advertising men gave Mr. Wrigley full credit. Like wheat in western Canada, cotton in the South is the overwhelmingly important thing in the material welfare of almost every man, woman & child, white or black. As such cotton looms ever-present in the buying consciousness. To make southerners think of Wrigley's gum every time they think of cotton would be little short of the sublime in advertising.

Said Gum Man Wrigley modestly: "I'll be lucky if I get my money back. But I'll buy just as much cotton as the people down there will buy chewing gum. The people of the South are all right. They just need a little help. I can't do it all but I'll give them all I can. . . . Our object is to leave our cash in the South, hi the South's own coin--cotton. We believe cotton at 12-c- per Ib. is a good investment. If it goes up, as we feel is probable, we will profit. If it goes down, we become partners with the South and take our loss with them."

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