"MADE IN BRITAIN"

Dominion, Volume 11, Issue 2, 27 September 1917, Page 5

"MADE IN BRITAIN"

JOHN BULL'S MARKETS IN NEW ZEALAND

NOT WELL EXPLOITED

POINTS FOR EMPIRE TRADE

REFORMERS

His Majesty's Trade Commissioner in New Zealand (Mr. 'It. W. Dalton), in his annual report to the Home Government on the trade of the Dominion, dwells at some length,.-and in a very interesting way, on tho trading methods of British firms in connection with their enterprises in New Zealand. The essence of his remarks, shortly stated, is that Britain must "buck up" in her Imperial markets before,it is too late. "Nine persons out of ten whom one meets in New Zealand," he says, "hold tho confident opinion that the British manufacturer has been out of date, slow and unenterprising. During the post year I havouiet some hundreds of people in all parts of the Dominion, inost of ' whose_ first words to me, in my official capacity, I could have recited before they began to speak. The desarintion is applied generally without qualification, but when one asks for specific instances it is probably safe to say that 75 per cent, of the critics either cannot produce one at all or quote a case for which the explanation is readily available, and for which,the blame, if there is any, does not attach to the manufacturer himself. la some instances cases quoted are wide of the actual faot. For instance, I was told in one town of a slasher which was invented in New Zealand as being best adapted for New Zealand conditions, and it was stated that repeated applications to British manufacturers bad failed to secure a slasher from Home. Tho next day I was shown by. a firm iiu the same town a slasher of this pattern of British manufacture which had been supplied •on first application. At the very, next town to which I went tho same case of lack of enterprise of British manufacturers was quoted tc/ me! While I do not contend that there is, no justification, for the criticism, I think the average New Zealander overlooks the fact) that like all other .manufacturers the British firm is in business for the legitimate profit he can make out of, the business. The New Zealand business man'.wonld be the last in the v.-orld to'.supply goods-which were unprofitable to make or produce, and while the tu .quoque argument is a useless one, it is my experience that most of the criticisms to which I. am referring could bo aimed with equal force at the manufacturers of_, other countries as well as at the critics themselves. That United Kingdom manufacturers supplied some 63. per cent, of the 'competitive' imports of New Zealand in 1916 is a ; fact, j,nd when due allowance is made for the desiro of New Zealand to purchase British goods whenever possible, we .could not secure that amount of trade if our goods were not suitable to the market. There are outstanding cases of trades in which' our position is unsatisfactory because our goods are unsuitable; there ere also cases of goods produced in tho United Kingdom which would bo competitive with goods imported into New Zealand but which are not soldi hero; generally speaking, however, the. position that we hold in the market is satisfactory. One is apt to forget that a great deal of the talk of some foreign manufacturers, though pleasant and invigorating for the buyer to listen to, is only 'selling talk.' The incompetent buyer may bo 'bluffed' by it, but the competent buyer measures the intrinsic valuo of the goods and purchases accordingly. Tho knowledge of the quality of the goods themselves by the manufacturer is,' however, inclined to lead him to let these goods fell themselves on their quality, forgotting that there aro a great many buyers who aTO not competent to judge values, and that foreign makers of goods (which iv.ay be inferior) are constantly 'talking* their goods. This brings rao toi an aspect of trade in New Zealand in which I think criticism of tho British manufacturer is to some extent justified. i

. Selling Organisation. "British goods, generally speaking, aro not placed on this market in a scientific manner. From a general survey of conditions one is almost led to believe that manufacturers do not regard the Now Zealand market as vital; if they get orders from New Zealand well and good, but they see no particular reason for going after them; if they come they add a drop to the ocean, if they do not come there is no great loss. There aro two considerations which Bhould, I think, alter this attitude, first, that New Zealand is part of tho Umpire and that wo ought to get as much of the trade of the Empire as we can for Imperial reasons, and, second,, that the New Zealand market has grown rapidly and will glow probably iinore rapidly. One cannot help but think that British, firms look too much to London, for their New Zealand business and too little to the Dominion itself. London agents spend days m the year, even for admittanco to London shipping buyers, while .a proper campaign in New Zealand itself would force the demand in London without -this need. In addition, there is the reason . which I have stated when dealing with tnading organisations in' New Zealand why a campaign on, this market is essential and why the fnll business cannot bo done in tho United Kingdom. From, what one sees of American operations in this market, one must admit, even if one cannot always admire methods, that small as the market is they treat it as carefully as they would a large market, and set themselves assiduously to get what trade they can out of.it. E«<ry boat which comes to New Zealand brings its quota of American business' men, and one finds them in all the towns to which one goes. For every business man who comes here direct from the United Kingdom to see the market and to orgiibise a, selling campaign, it is.' protmly, no exaggeration to say that ten comj from America. They examine conditions before they begin to operate. When they do operate the chief attribute ot Heir operations may perhaps bos: be described as-pampering tho vanity of their customers. It is a psychological feature of business which may be overdone in America, but is not sufficiently considered by : British firms. Treatment of Agents. "Complaints are frequently made to me by agents that they receive much more consideration from American films than they do from British. Too many firms appear to regard their agent as an importunate individual who is anxious to livo on their business, rather than as a useful employee whose energies in tho direction of securing business vary according to tho oncouraKeinent or discouragement which he receives from his employer. It is my opinion that short of establishing their own branch house in New Zealand, which owing to tho size of the market would not be worth while for more than a very few trades, the best method of operating in most lines is through a pure commission agent holding consignment stock if possible. My reasons lor holding this opinion are chiefly that it forces the manufacturer' to take care in the appointment of his agent; that it requires him to watch the market closely; that it prevents ltndno profits which are often loaded on to the price by buying agents if stocks are held; and that it facilitates sales in a market far distant from the source of supply. It is unreasonable to expect the agent to bear all the risks and responsibilities of the business, and it is a short-sighted policy to deny fullest information at all times to assist him to sell the goods ho carries. Not to eive the most caroful attention to the execution of orders after the agent has canvassed the market at great expense is nothing short of unjust. These are all matters regarding which I have received numerous complaints. There are,, however, others in which, I think, the agent himself is unreasonable.

And Customers. "It is only natural that the wholesaler or retailer will direct the greater energy to the sale of goods which give him the greater profit. It i 9 a strong feature of American business here that they endeavour chiefly to enlist tho sympathies of the seller by ensuring him a good profit on the lines he handles. Generally speaking, I think Amerrican manufaolurera etudy this subject of prices more than we do, and that the profits which

accrue to agents, wholesalers, or rotailers, as the case may be, are greater than the profits available from British goods. The fact is, of course, that tho iinal customer is often induced thereby to pay a price much in excess of the intrinsic valuo of tho article, but nevertheless tho goods aro sold. In a country like this price is. much less a matter of customary profit or cost than of how much the consumer can be induced to pay. In tho supply of literature, advertising novelties and show-cards, wall and counter cases, and so forth, retailers, in particular, like to 1)4 considered. Iu practically.', every hardware store in New Zealand the window displays consist almost always ; of American goods. I have frequently' asked why and have always had the same ausiver. It 5s not so much tho quality of the goods or their valuo for price which, is the cause, but ithe fact that they are got up in such a manner as to make a good display possible, while the retailer is also supplied with ' attractive or cases which'set off the window. Tfiis feature is not so noticable in trades other than American, but.it is noticeable that if the 'Americans supply a line it is almost always that line which is displayed. Ketailers, too, aro not always sure of the lines which it .will bo to tlieir advantage to buy, ano? they are glad of help from the manufacturer, his traveller, or agent. Eor example, thereis a large American concern in the hardware trade which has done a big business in New Zealand. Its traveller, an American, calls once a year, 'supplies only one store in each town, is in a position to adviso that store as to what it should or should not buy, and can supply, off hand, tho knded cost of almost every article included in a catalogue about threo inches thick. It is not an uncommon thing, too, for.American travellers to work up a demand amoi.gst users and then go to a local store and offer them the business, receiving in re-! turn an order which is often considerably larger than the indicated demand. This Ts done, for instance, by an American paint firm by calling on coachbuilders, painters, etc., and then giving the business to the local hardware store. Whether done in.this way, or by_ kinematograph display, or by advertisement <of the ordinary type, the end in view is to prove to the retailer that the business is there. Needless to say, the retaner quite approves of thismothod of having his business done for him.

Various Points. "In the matter of invoices consideration can be shown to the customers by giving full details of the contents of ami charges on each case. I have found that many retailers merely divide their charges .on each consignment equally amongst the goods. It is obvious, of .course, that this can only result in faulty costing. An invoice made out in the form most useful to the customer and which enables him to ascertain the freight and charges on every article in tho consignment is. desirable. In this connection it should be remembered that labour is very scarce in New Zealand, and that the saving of office work is a great consideration to the average business concern. Another method of considering the customer is in the method of packing. There is little cause for complaint in'the packing of British firms, and of the larger firms in particular. Some smaller funis, however, are somewhat careless in the matter. My attention was recently called to a sample of a toy packed in a spaco of 4J by 63 by 9£ inches, or about 272 cubic inches,,which could just as ensily have been packed in it spaco measuring not more than 7 by 9 by 1 inches, it 63 cubic inches. It is,obvious that customers in New Zealand will not continue to purchase from firms who do not make an endeavour to save as much as possible in charges for shipment of goods. It is a common complaint in New Zealand that firms cannot get catalogues a information from- British firms about their goods, whereas they aro inundated with catalogues of the most up-to-date kind from America.

Trade Journals. "It is generally* stated that American trade journals are' nioro useful in countries siicli as Now Zealand than their British contemporaries. The reasons for this statement often arguo weakness on the part of firms and individuals who should ho versed in their own professions or businesses. I have been astounded by the extent to v;hich architects and engineers, for instance, rely on tlie matter in foreign catalogues and trade journals for drawing up their own plans. While this may bo cause for astonishment, it must bo considered as a fact and allowed for. Another aspect of tho question is that traders say that they get more jractical information from foreign trade "Journals than from British, both in the advertisements and the matter. In tho office qf a large ironmonger recently, I noticed ninny numbers of au English trade paper dealing with their trade lying on the floor with tho wrappers still on.' AsKing the reason for this, I was told that the paper was practically useless' and that it was rarely opened. A foreign contemporary was relied on partly because of the interest of its matter, and partly because its advertisements were keyed to a .•onfidential price list, so that if tho reader took a fancy to an advertised article lie could immediately write for it, knowing the price' he would havo tc pay. In tho case of advertisements in tho other paper he had no idea as to prico, and either had to write and wait for months for a price quotation only, or to refrain from purchasing the artiole. Almost always he chose the latter course.

' Advertising. I am. convinced that there is a matonal limitation of the sales of British goods in New Zealand as a result of lack of .knowledge of their existence. It is the removal of this lack of knowledge which is the chief end 1 to be achieved. Ihis can be done by agency work, by catalogues, or by advertisement. The two first-named methods have already been referred to. So far as the last is concerned it must be .'admitted that there is a serious lack of British advertising in the New Zealand papers, although this is a country in which advertising would probably give better results in proportion to the population than in the United Kingdom. Now Zealand is a great newspaper reading country. Its newspapers travel widely from their centres both by rail and road. It is probably safe to say that there is hardly a 'homestead or settlement in any part of the country which does not have its own daily paper, or at least its weekly news-magazine. 1 am disposed to think, however, that tho organisation of a comprehensive exhibition of British goods in New Zealand as soon as possible after the end of the war would be t one of the most useful steps that could be taken to advertise British trade in general and individual firms' products. An exhibition of this character would serve the dual purpose both of inducing sales and of showing that the United Kingdom is still a great and powerful industrial qunntity. There would be a great difficulty in housing such an exhibition, if it were at all representative, in any ono town in New Zealand, but 1 feel sure that it would be of tho greatest practical benefit. The prime responsible iity.for making their goods known must, however, devolve on firms themselves. From inquiries which 1 receivo and from investigations I have made in all parts of New Zealand, I am convinced that in many eases foreign goods are selling only because they have been introduced to the buyer, and corresponding British goods have not. In other cases foreign goods aro selling because the organisation lor their sale is bettor and not because ti'e | goods themselves are cheaper or as reliable. It is in this respect that British manufacturers are lucking. As manufacturers I think it is generally admitted (and the war has been further proof) that they cannot be outclassed by the manufacturers of any country in the world. At present it is generally realised that their difficulties in the.United Kingdom are so great that they cannot givo all tho attention they othevwiso might lo private trade, but it is very important that thoy should lay their plans for after-the-war competition. As I pointed out in iriy report last year, foreign firms ar*-*rganising to the best of their ability. If our manufacturers aro to recovor their ground and improve it they also must organise beforo it is too late."