Inventories Checked

With inflation accelerating the tendency of merchants to bid against each other for a dwindling supply of commodities, the Government last week clamped down with a long-awaited inventory regulation.

Applying only to large firms (having annual sales in the year ending last November of over $200,000 and with inventories of over $50,000), WPB's order seeks to maintain the same relationship between gross sales and stocks as in the years 1939-41. Thus a merchant with average sales of $500,000 in the earlier years and stocks of $250,000 may now hold stocks worth (at cost) half of his current sales volume.

Leeway factors to this rule are allowed to cover particular hardship cases. The order does not become effective until the second quarter which means that most overstocked merchants will have a chance to balance inventories without costly dumping. With this flexibility, the trade believes that it has one of the fairest orders to come out of Washington.

This file is automatically generated by a robot program, so reader's discretion is required.