PASSING-ON OF COSTS

Hawke's Bay Herald-Tribune, Issue 182, 19 August 1937, Page 9

PASSING-ON OF COSTS

-Press Association.)

Manufacturers' Difficulty AUSTRALIAN COMPETITION

(Bv TelesraDh—

WELLINGTON, This Day. ,While tho shareholders might expeet increascd returns beeause of the trade revival during tho past year, sald M: W. H. P. Barber at the annual meeting of the Wellington Woollen Manufacturing Co., the trade revival had had many attendant drawbacks. Production timo had been shortened by the labour legislation, and extra shifts could not bo arranged beeause operatives were not available. He indicated that beeause of corapetition it was not always possible to pass on increased cost« and said that activities had been reduced beeause' of orders plaeed earlier by buyers who liad expected prices to rise. "When it was manifest early in the year that wholesale prices were sure to rise, prudent buyers increased largeiy thei'r uormal indonts at tho old ratcs. 'Choso orders we had t,o accept," said Mr Barbor, "or allow thcm to go elsewbere. i " There , prevails to some extent a vvrong impression as to the passmg-011 of increased costs," he added. "Whcro a monopoly exists it is, of coursu, possible; but certainly not where ex- . ternal and internal competition is keeu, as it keops selling prices, as we havo sometimes experienced, below the cost of making, selling and distributing. A new aligument of manufacturing aetivity, with its many eide-issues^ cannot be arranged just by request iu a largo woollen mill; it is uecessary to have from four to six months' work ahead. to mahitahi essential continuity." / The Prime Minister had aliirmed lus> pronouncement that tho industry would not be let down. "Protection from unfair competition/' said Mr Barbor, "is as vital to Ihe wor'kers as it is to the manufacturers." New Zealand manufacturers of woollen goods were being menaced by Australian importations. Australia was not affected by the exchange rate, and he considered New Zealand should demand that Australia should take as much as she sold at reciprocal trade for tho Xjrotection of New Zealand manufacturers. Australia herself had adopted some time ago quotas and, on cortain cdasses of woollens, complete embargoes. Mr. Barber said that the year cbuld justiliably- be described as satisfactory. Liabilities Avere less than last year, and tho gross proilts had increased, tliough they hud been reduced by profit-nnd-loss dobits, intcrest charges beiug greater as the result of increased costs. He announced an interiai dividend of 8 per eent.