TRACING METHODS

Hokitika Guardian, 4 January 1921, Page 3

TRACING METHODS

DECLINE IN IMPORTS FROM , BRITAIN. 'ii.M. TRADE COMMISSIONER’S COMMENTS. In tin* course of his annual report, just to hand, H. M. Trade Commissioner (Mr R. W. Dalton) has a good deal to say x upon trading methods as between the British manufacturer and the New Zealand importer. ‘•The United Kingdom's share of the import trade of New Zealand has continued to decline since the signing of Armistice,’’ states Mr Dalton. “In view of the reorganisation of industries at Home tliis was probably to be expected, but now that this re-organisation is approaching completion, if it has not actually been completed, the time has come to consider what steps can lie taken to effect a recovery of our trade. Prior to the war the United Kingdom’s share of th e competitive imports of New Zealand was (17 per cent. Although there were grave weaknesses in some sections of trade with New Zealand, it may fairly be said that on the whole

this percentage was very satisfactory. 'Since the war the United Kingdom’s shade of the eoinpetitve imports of New Zealand lias dee) jilt'd to about -to per cent of the total, whereas, in the meantime, the United States share has increased from 11 per cent to 27 per cent. J think it may be taken to be true that prior to the war a good deal of the trade between the United Kingdom and New Zealand had become routine trade, that is that orders for certain lines were repeated ‘from time to time as might be necessary without much thought on th P part of the buyer as to the possibility of securing corresponding goods at- equal prices from other sources. SEARCH FOR OTHER SOURCES OF SUPPLY. | “Since the war, however, buyers have been forced to look for other sources of , supply. Many of the goods which hav P been introduced since the war have been unsatisfactory, and some of the methods of foreign competitors have been unacceptable. Many of the goods which have been imported from other QAiiroiu’ InTii nivn’nrnt’ npni'O/1

sources have, however, proved satistaotorv, and even in the ease of goods which were originally unsatisfactory, considicrablh has been shown; in short, the channel of trade to j New Zealand has suffered by diversion ! in certain irspects, with the result that- the United Kingdom's position | on the market is not as strong as it for- i merlv was. On the other hand, the preference of New Zealand buyers for ‘ British goods, if it has changed at all, i has strengthened. It will not be snfF- ! cient. however, to rely on th<> strong- . thening of this preference for British j goods to effect an entire recovery of : British trade with New Zealand. Prior , to the war, for the reasons stated, ac- j tivc organisation in this market on the i 1 na'-t of British manufacturers was pro- ; I: ibly not as necessary as it was in the case .of foreign firms. The posi- ■ ' tion during the war has changed so 1 materially, however, that I think a 1 very active organisation will now be no- j ' eossary if United Kingdom mannfactur- ■ * ers are to recover ground which has been lost. , * “There are indications that many . 1 manufacturers at Home are fully real is- 1 ing this necessity, and it is to lie hoped ( that before very long they will be able 1 to carry their ideas into practice. Pri- ' marily, 1 think that the greatest need ! will be found to he a more active per- f ■ sonal touch with the market. There ; ' may not be any reason why the main ' channels of trade shou Id be in a position to have first hand knowledge of 1 conditions, and also to have represon- i * ting them agents whose prime interest , * is to sell the goods of particular firms. 1

c* I • * In some trades buyers will naturally revert to British sources of supply as soon as they fiipl that their demands can be met. In others it is feared that new sources of supply discovered since the war will retain their hold unless active, steps are taken by British manufacturers to re-introduce their goods. There is a third class of goods, that is, goods now manufactured in the United Kingdom on a greater scale, which were practically unknown in New Zealand prior to the war, in which even giVater activities will he required : f foreign goods, strongly established here prior to the war, are to be removed (front their pre-eminent position. In previous reports T have stated that I believe that the accredited agent of the manufacturer working on commission provides the best means of introducing goods. In view of the changes which have taken place during the war, I am more than ever convinced that personal representation .of manufacturers is necessary, LONDON BUYING HOUSES.

“f see no reason why tlie system of having accredited representatives of manufacturers should not be carried on side by side with the system of shipping through London houses. This method of shipping to New Zealand has been a common method for a great many years, and it ib a method which has been in the main entirely satisfactory. When 1 was in England, however, I found that many manufacturers were nut clear in their minds as to the difference between the various firms in Loudon who ship to Now Zealand. In the minds of many manufacturers these firms are known as ‘London Shippers,’ a description which is apparently used for all the various classes of export business to New Zealand done in London. There are, however, several distinct kinds of London shippers operat- • • ,i. xt n_.. 1 l i 1 1 ii

mg in tlio Now Zealand trade, and it is highly desirable that firms should know exactly the kind ol business which is done by each of the London firms through whom they ship, fn the first place, there is the London merchant who buys for his own account in England and ships to houses in New Zealand with which lie. is in no way associated. In the second place, there is the London house of the New Zealand merchant which may, or may not, have absolute buying power. In the third place, there is the New Zealand buying agent of the New Zealand firm, he that firm wholesale or retail. In the fourth place, there is the export agent who receives a commission from the manufacturer, out of which he sometimes, hut not always, pays commission to an agent in New Zealand. It will be obvious that the interests of the manufacturers are affected differently in

trading with each one of there shipping houses. Ido not wish it to be thought that J have anything against any of them, but I think it is of importance that manufacturers should have clearly in their minds the difference between them. “Arising from these differences are questions whether the manufacturer should be represented in New Zealand himself; whether he should trade with the wholesale only or with the wholesale and large retail only, or with all firms who will buy from them; whether he should show his goods mainly in New Zealand or mainly in London and whether he should, or should not, advertise in the market. It is impossible to generalise on questions of this kind, and it is only after close examination of the class of goods manufactured, of the nature of past and present business of individual firms, that conclusions can be drawn as to the most desirable methods to adopt in dealing with this market. Hut as showing the uncertainty which exists in the minds of many manufacturers as to the way in which they are at present doing'their business, it was not an uncommon experience for me at Home to find manufacturers under the impression that they

were dealing only with the wholesale when, in fact, they were dealing with 1 an extensive retail connection. It will he obvious that ignorance on these points is likely to do a great deal ot harm to individual businesses unknown to the principals. AGENTS’ DIFFICULTIES. ; “Agents of British manufacturers, during the last few years, have been working under very great difficulties, and it is questionable whether their i difficulties are now any less than they have been. It says a great deal for many of the agents in this country that during the war and since the war they have remained loyal, in the main, to I their British principals. Opportuni- | ties have by no means been wanting by i which agents here, could have taken up I goods of foreign manufacture and could have made very considerable profits, ' and I have been surprised at the number of cases in which agents have refused to take advantage of such opportunities, preferring to wait until their British principals have been in a position to give delivery of.goods. 1 should not 111— ( —-1 .. Il c tliof mil nil-

faeturers should show their appreciation hy actual remuneration, hut I would strongly urge manufacturers to ; realise that this has been the position I and in future ,to reciprocate in their treatment of their agents fdr the loyalj ty which those agents have shown durj ing a very difficult period. In eases where agents are personally known to their principals, I have found that there has been an understanding of the actual position, hut in many cases agents are unknown, except hv correspondence to their principals. In those eases, there is, in the minds of the manufacturers, a feeling that the agent has only his own purpose to serve in carrying their goods, and they fail to realise that he is the employee of the manufacturer, serving at the same time his own ends and those' of his principal. Since my return to New Zealand y have come across numbers of eases in which agents have toured the whole of the Dominion soliciting business and have received largo orders .of which probably only one-tenth were actually accepted. While it is admitted that this state of affairs must he unavoidable under present conditions, it should he clear in the minds of manufacturers that, the agent has been incurring as much expense in time and trouble as would have been necessary in pre-war years in return for a very small percentage of the commission which lie would formerly have received. In some cases I have known the agent’s journey through New Zealand to have been carried out at an actual loss by the agent. At the present time it does , not matter much to manufacturers . ~,.1 • 1 1 C

whether they receive lqyge orders from New Zealand or not, but when the time of depression comes it will matter to them very considerably that their ' agents, during the war period, have | maintained an interest in their goods, i and T contend that, this being so, the i eipal to be_ loyal and active J agent who is known >to his prig--1 in maintaining the principals name I here should be given generous i treatment in return for his activities, i Complaints here on this subject have been very nuyiv, and it has been very ! difficult to convince agents that the difficulties to be met with at Home by [ manufacturers were so great that in a considerable number of eases no better : treatment could have been given, but T ! am convinced that in a number of eases manufacturers have lost sight of the interests of their agents in the wave of prosperity which has come to them since the war. When the time comes for those manufacturers to want as much trade as they can secure in New Zealand, they will, I feel sure, realise 1 that their attitude towards their agents in the past prosperous time was a wrong one.”