The Dominion. MONDAY, SEPTEMBER 20, 1909. THE MIDDLEMAN.

Dominion, Volume 2, Issue 616, 20 September 1909, Page 6

The Dominion. MONDAY, SEPTEMBER 20, 1909. THE MIDDLEMAN.

The.Congress of delegates from the Chambers of Commerce throughout the Empire hold in Sydney last week was in effect a Parliament of middlemen—one might almost say the much-abused middlemen. Chambers of Commerce, in tho main, are composed.of merchants and factors and shopkeepers—tho intermediaries between the producer or manufacturer and the consumer. Again and again we have heard of and Been'offorts made to dispense with the middleman, tho argument being that'the middleman is more often, than not a. mere useless absorber of profits, who prevents the consumer getting on intimate and favourable terms with the producer, and impartially levies toll on both. The contention is that it would be vastly.cheaper to the customer, "and far more satisfactory to the manufacturer, -if this individual were removed and direct communication established between the two parties chiefly interested. , This -is the ideal, but it is unattainable, or, if attainable, it can be only so to a limited extent. The middleman, as wo, know him, is the outcome of industrial evolutionhe would not be here if his existence were not.necessary. ' A little reflection upon the work of the merchant, or agent, the distributor of the products of. industry, will ehow how widely 'different it is from that of the producer, and why tho separation of the two functions has arisen. The mind of the producer is fully occupied in studying the. nature of the materials he uses,' with a view to their transformation into other materials, in discovering the most efficient means of converting them into 1 forms which will please and satisfy the desires of .purchasers at a cost which will yield the largest profit to himself. The' qualities,'the training, • and tho experience of the morchant arc quite different. Ho is. not concerned about tho methods of production or their improvement. Ho concentrates his mind on'the enlargement and discovery of markets, in studying the' requirements and tastes of.-: consumers, their power of. purchase and ■■'. payment, ,the ever-changiDg: circumstances which influence ; the demand for particular things, increasing or lessening it, or altering its direction ,and character. : . Furthermore, the organisations required for the performance"of the two functions'aro distinct in kind, each of them being specially adapted for tho work it has to do. The.ovolution of tho middleman is due to,the same cause which led to the division, and subdivision of industries, and the further division and subdivision .of departments. • and., functions in'./each .ija-; dustry..; Modern manufacture isbecom-' ing: increasingly differentiated as to its methods,' and increasingly diverse as. to it 3 products. So.wide is the diversity in somo branches of industry that, manufacturers .have ! found it '. advantageous to specialise their- operations,: to 'devote themselves only to; the making of, certain descriptions, of articles or goods, for the' supplying- of which they-' havo, found themselves to be pre-eminont. By this Process,of,.specialisation..many/manufacturing enterprises, genorically'the same; have: bccpme'in ;: reality 'as-distinct from each other; as if, they sovorally.belonged .to'-diffcronfc: groups,. ■■ The highest success' is attainable only by' production on. a largo scale;.' and this involves in ,"mbst cases the ; widost; possible distribution- and sale of the product in. all accessible'markets.'. ■:■-./ .■■;■ ■',-■• ■•-■.•■:■■ : . ■. ■ ■■:; '.

Henco, moro now than in former times, the nocessity for the intervention of; the middleman, or rather several middlemen. For ;the business of the merchant .'is also specialised, both as rejgarda. the products distributed and tho territorial range of distribution. Few 'mercantile- houses, however: wealthy or well, managed, attempt themselves -to carry on • business with all the : markets; or cveh: all the pri n'cipal markets,; The particular knowledge of each -market, tho management■ of crodit-;ahd other'details : of : administration .are so different, in: tho sovoral countries, that merchants find it Jadvan-i tageous tolimit-thcir spheres: If, then, the middleman is restricted in his operations by such difficulties, how much more difficult would it bo for the manufacturer to keep: up tho organisation requisite to undertake the: distribution of his production.. It merely requires to be stated, to show,,the stupendous difficulties, and the pressing need of the. middleman. _ It Jβ perfectly certain that while the middleman is'found useful'in industry he will be retained, but directly it is discovered that he can bo dispensed with* and. that he is a;raere economic parasite, he will have to go.'No one wants to keep' useless nnd, oxpensive agencies: in existence, for sake of commercial, traditions, i and no sane person will wish to get rid of them from revolutionary motives when , their' retention 'is essbntial. t'o the prosperity and progress- of trade■ arid commerce. -■ / ;.■.•. : .■■■•■ -/v,;