Detroit Free Press from Detroit, Michigan • Page 74

1 In This Section Oi I he Counter 1 if A'or York Exchange 2V American Exchange 141 Mutual Funds 14F Business Report SUNDAY, JULY 16, 1972 in-F "lite otks? Lumber akes the id MERCHANTS WIN Fischer Creates Chess Sales Boom NEW YORK (UPI) Temperamental Robby Fischer may be a nuisance to international chess officials but he's a real bonanza to makers of chess pieces and boards and instructors in the ancient game. Stores in New York City, where there is a big foreign-born population, reported sales of chessmen and boards and books about chess began soaring weeks before the match between Fischer and the Russian world champion, Boris Spassky, started. The chess men, often with matching hoards, sell for any-were from $5 to $1,000, and occasionally the finer antique shops of Fifty-Seventh Street of upper Madison Avenue have even more expensive sets. Abercrombie Fitch, possibly New York's most exclusive store catering to gaming and sports enthusiasts, said the Fischer-Spassky match has produced the same kind of stimulated demand for sets that the visit of the American table tennis team to China last winter created for ping pong tables, balls and paddles. "I would say we had a 40 percent bulge in sales of chessmen and boards," a store spokesman said.

Brentano's. the exclusive Fifth Avenue bookstore, said lis sales of chess sets spurted for weeks before the match but have dropped off since it started. Sales of books about how to play chess, which cost around 58.95 on the average, also have been good. And teachers of chess who charge $5 an hour as a rule have had quite an increase in business. So have those public chess and checker halls that rent boards and' a place to play at $1 flrti hour per player.

Dayton Hudson In Mail Order Catalog Business Dayton Hudson Corp. has purchased a St. Paul based mail order merchandising operation as a means to enter the growing catalog showroom business. The the Sihley Co. and Consolidated Merchandising did $5 million in sales during the fiscal year ending last January.

The purchase price was an undisclosed amount In cash and 10-year notes. Sibley and Consolidated sell general merchandise by mail order and through two showrooms in the St. Paul area, they provide an annual catalog of 5,400 peroral merchandise items to a list of selected customers. The items may he purchased by mail or in the showrooms. A Dayton Hudson spokesman said the company's desire was to obtain a seed acquisition to launch a strategy into the catalog showroom business, lie would not comment on how quickly Dayton Hudson planned to expand the business or whether it would locate showrooms in Detroit.

"Our research indicates that the showroom industry has excellent potential and we expect it to get an increased share nf the market, particularly in hardgonris. It offers a good combination of convenience and pric he said. The catalog showroom concept reduces store overhead to provide low prices on merchandise. Because of the selling method it suffers fewer thefts and requires fewer clerks than the usual discount store. fl? Leagues BY BRIAN BRAGG Pcm Prm luilneis Writer It's a long way chronologically, geographically and philosophically from a small lumberyard in Royal Oak to a high-rise office tower on the Detroit riverfront, hut ERB Lumber Co.

has come the distance. The so-called 90-day silent period afler ERB's initial pub-Ik; offering has elapsed, and company management took the opportunity lasl week to tell its story to a group of security analysts in Detroit. One of the most interesting topics of discussion was ERB's involvement in Henry Ford ll's riverfront development proposal. LRB's connection is a nne-third ownership of Aniurcnn which plans to build nne of the four office towers proposed for (he riverfront project. Amurcon owned equally by ERB, the mortgage banking In summer and even in fairly cold weather, chess is played outdoors in New York in Central Park, in Washington Square in Greenwich Village and a number of other parks and squares.

Many of the players are immigrants or the children of immigrants from Russia and other east and central European 'countries where the game is a cult. AGENCIES SEEK MILLION -DOLLAR BUSINESS Ad Army i I Policy ar over and by developer Barton M. family of James T. Barnes German was formed last year sidized apartments and other commercial projects. Amurcon developed about 100 unit last year and ERB president.

Trod A. Erh told analysts the firm will complete another (i00-700 units this year. Erh said he expects Amurcon to contribute some 15 cents a share to ERR lumber's earnings for this year. That would be over $200,000 not had for an initial investment of $100,000. Erh said ERB Lumber's earnings for the first half of 1972 about $511,000 (41 cents to develop government sub multiple-unit residential and a share), up by .15 percent near Northland (they're continuing basis." Ann Arbor.

which Erb says did not ron- from the $378,000 (35 cents) earned last year in the half. Revenues were about $14.3 million, up from $11 million a year earlier. QUERIED ON full-year earnings prospects, Erh replied that. '1I5 cents to $1.05 a share "looks like a good ballpark figure." The company earned 85 cents a share last year but this was before the public offering in March. Rased on the larger number of shares now outstanding, a profit, would represent an earnings gain of about 50 percent and $1.05 would mean a 65 percent gain.

All this for a stock that's selling at about 14 times projected 1072 earnings. ERB went public al $16 and Is now selling over the counter at about $14. ERB Lumber recently acquired a lumber company near Grand Rapids for cash (it earlier acquired one in Lansing) and now operates three centers catering to builders in addition to seven retail yards. 'Hie company, founded in Royal Oak in 1913, is looking to expand its retail operations and "very definitely" to expand its real estate activities, according to Fred Erb. The division whicn concentrates on sales to builders will likely not grow, he said.

Amurcon is not the only real estate venture for ERR 1 i miliar Tim rnmrwnv has a 30 percent niece of North -If -Ol rA xts. 'Park Place apartment towers now renting), pcrccm 01 me run wancr in West. Rloomficld Township and 25 percent of which has a significant rider attached to it. The ridrr was put there by Sen. Richard S.

Schweiker, who sits on Senate Armed Services Committee. The rider, which has been approved by the committee, approves funds for broadcast recruiting on paid-for time. Rut what makes advertisers think that buying prime radio and television time will pay off in recruits? The Army through Its agency, N. W. Aver Son, conducted an experiment last year which proved that it works, Adams says.

The Army's ad budget for fiscal 1972 was $3.8 million to be spent in print media only. That meant no paid radio or television. Rut it managed to get a special additional budget of $10.8 million to test the effectiveness of commercials on specially purchased radio and television lime. THE TARGET: 17-to-21-year-olds plus a secondary audience of older people, such as parents, teachers, guidance counselors. The message: "The Army Wants To Join You" by means of 30- and fiO-second commercials on all three networks and Metromedia.

The positioning: Reside movies, sports, the "Flip Wilson Show," "Love American Style" and "Ronanza." On radio it was done through one-minute spots in the top-100 markets. The campaign kicked off on March 1, 1 971. Results of the 1.1-week lest Enlistments in the combat arms, which had been running al ,141 Ihe month prior, jumpwl lo 525 in March, 1,037 in April, 1,875 in May and 4,216 in June. For the year 1971, says tha Army, enlistments in ihe infantry, armor and field artillery, which the recruiting commercials had stressed, were 26,874, against 3,106 the previous year. The Army felt the experiment "highly successful" and asked Congress for another $9 million to continue the broadcast experiment through June of this year.

Congress said no, and there's been no paid radio or television recruiting commercials since. If the Schweiker rider survives the legislature process and funds come through, D'Arcy-MacManus will probably step up its expenditures on radio and television promotion, and replot the media mix. D'Arcy-MacManus, of course, won't be the only one, N. W. Ayer will prohahly redeploy its portion of the Army's $23.2 million ad Budget; Grey Advertising of New York, its share of the Navy's million ad budget; J.

Walter Thompson, its portion of the Marines' $5.14 million budget. IF CONGRESS approves the purchase of paid prime time, however, it" will solve one problem but perhaps introduce another: Will radio and television stations continue to donate the free public-service time? After all, stations mieht reason, why give Ihe time away when the services now have the money to pay for it? 'and should contribute on a Ithe Earharl Estates project rhr rral rstate oneralinns. in If the government wants an all-volunteer armed services by next July the House Armed Services Committee is going to have to drop its ban that, prevents recruiting commercials from being shown on paid radio and television time. That's the current feeling within the advertising industry, and Charles F. Adams, vice-president of D'Arc y-MacManus International is one who has good reason for advocating that the ban be lifted.

His agency, which is based in Birmingham and has hillings in the neighborhood of $245 million a year, is entering Its 13th year as the creator of advertising for the U.S. Air Force Recruiting Center. If the ban were lifted, he could do a more effective job. TRADITIONALLY, commercial message aimed at inducing young men and women into the armed services have been aired on radio and television but only in so-called public-service time; that is, time which stations, as a condition of their license from the Federa'l Communications Commission, give free to public, non-profit causes. There's no such string attached to ads in other media: Newspapers, magazines, billboards and the like.

Unfortunately, from the advertiser's standpoint, such free time may banish recruiting commercials to after the late-late movie, or to the Sunday-morning, re hour ghetto. It is highly questionable, say advertising agencies, if potential candidates for their artfully produced messages are in the audience at those times in substantial numbers. So-called "prime" television time the evening hours between 7 and 11 o'clock will have to be available, they argue, if manpower in sufficient numbers to justify eliminating the draft is to be generated. The chairman of the House Armed Services Committee, Rep. F.

Edward He-hert, is opposed to the idea and succeeded in getting the committee to pass a lution prohibiting paid broadcast recruiting in fiscal '72. Advertising men with armed-services accounts, nevertheless, believe thai Congress will eventually have In provide the money for prime yield BY DOROTHY WEDDELL fret Press Real Eitals Writer The Travelers Tower, last week's office leasing coup, signals new phase in fast-grow--i Southfield's commerdiaf development: Office buildings with a full line of stores and services built in. Thai's all part of the South-field master plan and, according to the city's planners, it will lead eventually to complexes with offices, stores and apartments. If this happens, it will reduce Southfield's traffic crunch around the office buildings, a problem which a recent citv-snonsored survey find to Recruiting ads are cctting away from the old "Uncle Sam aWnts You" image. Here is a sampling of ads for the print media, run in both paid and free spaces.

Ad agencies want equal treatment for ads in the broadcast media, which are restricted to free time slots, 'li'ibule to earning'-, last year, are now "coming to fruition land should contribute on a continuing basis." If mother ever did any home canning of fruits or vegetables, the symbol of Ball Corp. should be familiar. The 92-year-old family-owned company has sold literally millions (billions?) of glass jars bearing this trademark in relief. 1PH With a bow to the new tax law regarding control of companies by related foundations, Ball Corp. went public last week and sold some 22 percent of the company for about $26 million.

ast year. Rail Corp. netted $fi million on $163 million IT'S NOT the amount of the time that worries Harvey, it's the "positioning," to use the adman's vernacular, for he like the other armed-services advertisers is left to the "charity" of station managers and has no option but to take whatever he gets. D'Arcy-MacManus won the Air Force account: 12 years ago from Irwin, Wasey, Ruth-rauff Ryan. During those years the draft has prevailed, broadcast recruiting has been restricted to public-service time, and the agency hasn't been able to sales.

Self-Contained broadcast time. And if this happens, a recruiting account will go from the realm of small potatoes to major billings. For prime television time is expensive. A 30-second spot on one of the national networks can run as high as $6,000. The government's regular budget for military recruiting now amounts to about $44 million a year $30 million of which goes into advertising.

The current Air Force ad budget is $7.1 million. D'Arcy-MacManus is responsible for spending $5.6 million of it. Office be the area's knottiest. BUT IT WILL also put an added burden on the managers of 1 s- sophisticated office ahuildirrgs- still caught' by thef slowdown in leases in the last two years. The Travelers Insurance Companies announced last week that they will lease to (30,000 square feet of an 18-story building at Evergreen and Eleven Mile.

The contract is one of the largest office leases written in the region in recent years. Most of the rest of the building has been rented to 40 other tenants. program its radio and television campaign in the most logical market strategy. But if the government decides on an all-volunteer armed service, and if the House Armed Services Committee relaxes its prohibition, the picture could change drastically. Tor one thing, agencies with recruiting accounts would find themselves In the very expensive ball game of prime-time television.

A change could begin within the next two weeks, when the Senate debates a Department of Defense procurement bill their lytime populations. The Travelers Tower also has a timing advantage. Leasing activity at least the negotiations that precede the signing began to pick up in the Southfield area in early 1972. According to F. Robert Di-maria, of the commercial development' department of Byron W.

Trerice 91,561 square feet of an available 354.172 was leased during the first quarter of 1972. DiMARIA REPORTED (hat another self-contained building, Advance Mortgage building at Nine Mile and Orecn-IMcnse turn lo Page I5F, Col. I How that $5.6 million might best be parceled among the various advertising media radio and television especially is one of Adams' current concerns. D'Arcy-MacManus handles the Air Force account out of its New York office, where Frederick P. Harvey, a company vice-president, is management supervisor of the account.

Harvey estimates that public-service broadcast time currently being sought by D'Arcy-MacManus for its Air Force account amounts to about $14 million. Trend: agent, Schostak Bros, and Co. lnc, have a classic example of the right product, at the right time in the right place. ii, magic word. The Travelers Tower will house a bank, a jeweler, barber shop, beauty shop, sundries store, dry cleaner, (ravel agency, florist, cosmetic boutique, delicatessen and a restaurant.

There is also a very posh private health club on a ground floor wing. And self-contained has taken on significance to other beside prospective tenants. From now on developers making proposals to Southfield's Itonk value is something like the Dow Jones industrial average: Investors like to watch them, hut the bare numbers don't mean much. It has long been a custom for north central Indiana residents to drive past the sumptous Ball estates in Muncie and wonder, with envy, Just how much money the family was making. Now they know.

Two Detroit-based firms are listed by Forbes magazine in a compilation of what it calls "loaded laggards." These ere companies which have a current market price of 40 percent or more below book value. The two Detroit firms are Federal's the loss- plagued department store chain, and McLouth Steel, which is showing signs of a turnaround after a long bout of red-ink problems in production. 1 Federal's, tabbed'by Forbes with a book value of has been selling near $4. Mclouth Steel, priced near $18 on i the NYSE, has a book value of $40.79. Planning Department and city council will he regarded with more favor if their building plans include retail services.

According to, City Planning Director Donald J. Gross', a $6,000 research study for the Southfield city council last spring showed car tie-ups around the office building to be one of the toughest problems. Further, the study projects an increase in office space of nearly 60 percent during the next decade. To avoid rrippling traffic problems, Southfield will need In insist on office buildirtgs with services included for HOOK VALUE, of course, is an overrated analysis tool. It depends on such things as par value of shares, a factor that can be changed almost at will and often is.

Rut in the case of both Federal's and McLouth, the cipal item in determining book value is the retained earnings account, and in both cases, these retained earnings cannot, be tapped for shareholder dividends because nf sirirhons demanded by lenders. Thus, these retained ings aren't doing shareholders a bit of good. It appears that the t4.