IMPORT TRADE

Hokitika Guardian, 1 November 1921, Page 4

IMPORT TRADE

MR 11. \Y. DALTON'S REPORT. WKEUNGTOX, (let. 2(i Till* following extracts from the ;.n----nii:il report ol Mr R. M. Hnlt'.n, lI.M. Trade Commissioner for New Zealand, to I lie British (lovernmeiit: Tin* total imports into New Zealand i„ the year I!CM) were valued at £lil..'illo.SllS as (ompared with £R(),(}. ! .OHS in the previous year, for the first ine months of 11)21 the imports have am. to £2 1.7E1.2 I I as compared with £l*' 5 .!)fi‘2.1T1 in the correspond, ng |H*iiml of last year. With regard to the figures for tor present year as compared with last it has to Im noted that* the deluge of importations in ECO did not set in until well on in the year, and that the imports entered in the Statistics in 1021 have been to a considerable extent goods which actually arrived last year, bill, were not cleared through tile Customs owing to financial stringency. It lias already been pointed out that the imports of last year bav,. been a cause of considerable financial embarrassment fn the D. minion. During the war and since the Armistice up to the second quarter of last year there bad been a great shortage in Now Zealand nf almost all classes of imported goods. At the same time the demand on the part of the general public was pbenomenallv large. The existence of this do. main! encouraged considerable purchasing mi the part of the trading community and the difficulty of getting doliverv of goods wbieli were urgently needed prompted buyers in many eases to order considerably more than they really needed in the hope of getting a part and to place the same order with more than one firm ill the hope that, one at least would supply, the cider to each luring sufficient for their requirements. FI,OH!) OF I.MI’OHTS.

Karlv in June reports of a. break in prices in (he Vailed Kingdom Ix'gnn to reach New Zealand. In the first instance at least, those reports were .very considerably exaggerated, and they did a great deal of harm hero at a critical tine*. “Slump” news immediately affected the buying public and an entire cessation of general buying synchronised with t lie time when very large shipments of goods began to arrive. During the second half of tbo year every ship brought full cargoes of goods to New Zealand, and it- was not long Ih»fore financial resources were oxdin listed. In many eases, tin* goods arriving were deliveries in execution of orders which had accumulated on the hooks of manufacturers over a long per. iod. Tll the absence of financial facilities. many importers were unable to take up their documents, many goods had to he left in bond, retail sales became the order of the day, and in some eases .auction sales of newlv-landcd goods were the only recourse for those responsible for their im potation. Kven tin* largest, firms in New Zealand have Round it very difficult to carry on with stocks accumulating, with banks pressing for reduction <of overdrafts, and with no apparent outlet, for the goods arriving. The seriousness of the situation can hardly he under-estimated, and it says a great deal for t.ho old-estab-lished firms here that they have been able to weather the sfiorm as they have. SAXCTTTY OF CONTRACTS.

H wll not serve any useful purpose to go very closely into the question of whoso is tlie responsibility for the conditions which have been created, but in view of the criticisms which have been levelled at the British firms in regard to these shipments, it booths desirable to mention one or two aspects of it. I propose later to deal with the question of the responsibility of the British manufacturer. T would point out here, however, that a great deal of tlie responsibility mud. rest on New Zealand importers for their excessive ordering and somewhat careless supervision of the numbers of their orders still on the hooks of manufacturers. A great many of the larger importers will readily admit this responsibility. It is usually those who have more recently taken up importing who seem to over look certain essential factors of business. Rut generally the conditions of the recent abnormal period seem to have brought about a forgetfulness of the usual practices of commerce and of the sanctity of contracts. Under ordin_ ary circumstances an order earliest possible delivery” accepted flTld '

entered in the hooks of the manufacturers is there to Vo executed as soon as the manufacturer can execute it, miloss it is definitely cancelled in the meantime. Immediately the manufacturer was able to execute, ho would therefore execute in the belief that tlie goodH were needed, and it seems extraordinary that purchasers should presume that orders definitely given under the wide terms of “shipment, at earliest possible date” could he automatically cancelled by effluxion of time, and were therefore no longer -on manufacturers’ hooks. Yet I have heard tin? statement advanced time and time again. Moreover, I suggest that anxious as the manufacturer might he to meet his customers, he could' not, possibly do so unless his (ustomer took the* trouble to explain his exact position in regard to goods to be shipped. Otherwise, an order still on the hooks I must, it seems to me. remain an order to Ik* slapped. Failure to ship “ns* won ■IS possible” would pi vc opportunity For (■aneclintion, nml for the* removal from the shoulders of the purchaser to those of the seller the loss resulting from n falling market. [ van hardly see that it can he contended that sellers should submit themselves to this risk, and otherwise it, follows that, saving a definite. arrangement made they would ship all they could of orders in hand at the earliest moment. This seems to me to explain a good deal of the ship, monts of last year, and i think it is an explanation which should ho made very clearly. The old-estalilished hrms will I feel sure, admit* it as lioing at least just, rr it is correct. and if., as T believe, it- dines explain a great proportion of these large shipments of old orders, then either the importer here, nr his buyer in Bowlon.' must lx* t<> Lb,mo for not making their jHwition clear in their own minds and in the minds of tin' manufacturers. That Ihe goods were shipped proves that the orders had net been cancelled. It must ho remembered, too. that conditions changed very rapidly, and that one or two months before tlie goods were actually delivered malic buyers would have been glad to now that they had :,,iv choice at all of getting even all tlu Kids thev had ordered. REGEI.ATIO.N OF BUSINESS.

In one of my annual reports some few years* a**o T referred to the cninplexit.v of interests concerned with import trade ill New Zealand. The extraordinary prosperity of New Zealand in the past few years Ins made import business a very emlitnl.lc undertaking amt eeonseouetit ly there has been a, larpe crop of new importers anxious to .ret a share in the business which was available. Tims in addition to tlie importing done by the wholesale and the lari r er retail trade, quite small retailers have become importers, and .'cents and brokers wlm in normal times would almost all he eom-erned ('lily witli internal business have launched nut m speculative importing. Ii is the very considerable business done by the two last, mentioned classes in partieiihii w hieli in my opinion lias complicated mailers here so mm li and has led 1 to so much trouble, ft is obvious that it the wholesale .illy were importing it* would In* much, easier foU them to ic- , * 11 1 aI e riieir Iniyino in order not to over-supply the market in U"*mal limes, nor excessively to ever-siipnly it ill abnormal times. Even tile wholesale ami large retail together could regulate tin* business, but all these other factors entering wTti'h have entered and with so much ordering in excess of requireiiieiils I>\* all ot them, it iA clear that Hie market was Round to bo caught, as a whole. This seems to me (o Ik* distinct weakness ill the. importing organisation of New Zealand, ami to be also a weakness wbieli will produce damaging* results in any time of crisis such .*s arises from a depression . The comparative ease witli wbieli credits could he secured through the hanks here lias also been a contributing factor. 1 do not propose to develop tip's side of the question, except, to sav that: an earlier restriction ol these iiedis and a closer consideration of the circumstances of some of the now import iim interests would have obviated *, 1 >rent* deal of what has taken place. In connection with the whole of the question of ovor-importim.. 1 should like to say here that I think it is wonderful that New Zealand has been able to hear the strain and that generally speaking, traders here, and particularly |l u . old established traders’ have accepted tile situation and have stood l>y their commitments. Mhile there hate been some cancellations which were hardly justified and seme lofusds to take up goods which were shipped eleven actually land. d. the general body of .dll established importers have honouraldv fulfilled their engagements. A GREAT ACHIEVEMENT.

New Zealand with a population of hill,, over a milliiii Inis accepted goals t„ the vine of over CSo.O WKKI in seventeen months, while her exports a mounted to only tott.dt 10.000 in the same period and many of (lies.* exports were paid for long before the period in which they were shipped. T think this is sufficient proof of the preparedness of \<*w Zealand merchants to stand up to their contracts, and ! question if there is anv other country in the world ,*. hi;-!, .-an show such a record. Ref..re leaving this subject*. 1 should .mini out that in considering the figures ~f imports it should tie remember.. «•! that* the actual quantity of goods it.ported is not nearly as great as the of Villi’i* would load on*’ to suppose. 11l this eciineetioii it may be said ll>*it actual stocks are not phenomenally great in quanfily. it is the value represented combined with tin* difficulty „f getting financial accommodation which 7s causing distress. Stocks are large, of course, hut it is only in eottin iinos tlin they are really much m ..\ress ef normal: Money must lie realised. however, and consequently sales are being hold one after the ether all over the Dominion, reductions fveing greater with each succeeding sale. One whalesalo warehouse even has thrown its doors open to the public for a ictail sale.

It is difficult to forecast the future hut it seems certain that before very long there may actually lie n shortage „f ..oods in tlie market. There lias been very little new buying particularly in tlie soft, goods trade since September, 1!>20. Most ships have been coming out in ballast for some months now. and it is only very occasionally that, shins arrive with any quantity of (•arm). Tn view of the distance of New Zealand from the source of supply, it takes a considerable time for goods to til* received in execution of orders, and if there is a revival ill England in the near future, which seems likely, it is not im probable that New Zealand may before very long he again in the position of finding il difficult to get goods when a demand exists here fo r them.