February 10, 191" 



HARDWOOD RECORD 



19 



manufacturers' association, and that a free interchange of ideas hyjpper- 

 ators worlting under similar conditions would result in less waste, better 

 lumber and reduced costs. This can be accomplished and accomplished 

 only through organized effort. 



No other class o£ men can hold a candle to us when it comes to 

 salesmanship. Here is where we shine. In making this statement I have 

 in mind what I should like to be able to say. As a matter of fact we 

 lumbermen are poor merchants as a class. We are better merchants 

 than we were a few years ago but still do not follow, as an industry, 

 the methods adapted to giving the best results. Scientific salesmanship 

 is a fact today. The principles underlying it have been so worked out 

 by such organizaticns as the Dalton Adding Machine Company, National 

 Cash Register Company, The Steel Corporation and others until it, with 

 them, might be termed an exact science, . Machinery manufacturers, pro- 

 ducers of electrical equipment. 

 etc, employ sales engineers who 

 are men of technical education 

 and practical experience. These 

 men are big factors in the suc- 

 cess of the business they repre- 

 sent. 



Owing to the nature of our 

 industry we may not be able to 

 go so far, but there is no reason 

 why salesmanship in the lumber 

 industry should not be improved. 

 Here again organized effort will 

 bring results. This subject is 

 so important that we have 

 brought here today a man who 

 will talk to us upon the science 

 of salesmanship. This man is at 

 the head of a great sales organi- 

 zation, and I hope that every- 

 one here this morning will not 

 only hear his address but will 

 profit by it. 



Another subject which de- 

 mands our attention is that of 

 costs. Without an accurate 

 knowledge of what it costs us to 

 produce lumber we cannot hope 

 to get very far with the market- 

 ing of it at a profit. Our Fed- 

 eral Trade Commission, in its 

 efforts to bring relief to the busi- 

 ness of this country, has given a 

 great deal of attention to the 

 subject of costs and has pub- 

 lished a booklet called the "Fun- 

 damentals of a Cost System for 

 Manufacturers." This booklet 

 should be read by every lumber- 

 man. An investigation by the 

 commission of the business in- 

 stitutions of the United States 

 developed the startling fact that 

 only ten per cent of our manu- 

 facturers and merchants know 

 the cost to manufacture and sell 

 their product. Forty per cent es- 

 timate what their costs, are, and 

 fifty per cent have no method at 

 all, but price their goods arbi- 

 trarily. 



We liave been fortunate 

 enough to secure the services of 

 Robert E. Belt, chief accountant 

 of the Federal Trade Commis- 

 sion, who will go into this mat- 

 ter a little later in the day at 

 con.siderable length. 



The subject of hardwood grades is food for daily thought and for 

 annual presidential addresses, and it should be, as it is the very heart and 

 soul of the hardwood business. We do not consider our rules infallible, 

 but do claim they are the best set of rules for the inspection of hardwood 

 lumber, both for the manufacturer and consumer, and in the conservation 

 of our timber resources, that has ever been written, and that the funda- 

 mental principle upon which these rules are based — that is, that both 

 sides of the board shall be taken into consideration in determining the 

 grade — is the only correct principle for the grading of hardwoods. We 

 stand ready at all times to make changes in these rules when there is an 

 economic necessity for them, and with this thought in mind we court the 

 advice and suggestions of the consuming manufacturers. We deplore the 

 fact that many consumers have neglected to interest themselves in matters 

 pertaining to inspection, and welcome the day when they will be as familiar 

 with the inspection rules as are the manufacturers. The chief criticisms 



SECRETAIiY W. II. WELLER, CINCINNATI, WHO IS RESPONSIBLE 

 THE VERY INTERESTINf! PRdliRA.M AND LIVE INTEREST 



of Jiw rules of this association have come from people either not familiar 

 with them or who had some ulterior motive. Criticisms, without sugges- 

 tions, arc worthless. 



We have felt for some time that there was too wide a range between 

 the grades of Is & 2s and No. 1 common, and a place for a select grade 

 in oak — and at this meeting the chairman of your grading commission 

 will submit to you a rule that has been given very careful thought, and 

 one that we hope will meet with your approval — a rule that we feel will 

 be very acceptable to the consuming manufacturer. 



Just what is in store for the lumbermen of this country at the close 

 of the European war I would not attempt to prophesy, but one thing Is 

 quite sure — if lumler is used in the reconstruction period, as it doubtless 

 will be, it must come from countries other than England, Franco, Gennany 

 and Belgium, and if the lumbermen of this country stand together for 



the purpose of developing the 

 forei,gn market, there is no rea- 

 son why they should not receive 

 their share of the business. The 

 Department of Foreign and Do- 

 mestic Commerce of the United 

 State Government, supported by 

 the lumbermen, is now making 

 plans to send representatives to 

 Europe to study conditions there 

 for our benefit, I recommend 

 that you give President Down- 

 man of the National Lumber 

 Manufacturers' Association, who 

 is working directly with the gov- 

 ernment, your hearty financial 

 and moral support in this work. 

 When President Downman asks 

 your support he most certainly 

 deserves it. It is useless for me 

 to enumerate the great things 

 he has accomplished for the lum- 

 ber industry in the four years 

 he has been president of the as- 

 sociation. He has given freely 

 of his time and money, and has 

 made many personal sacrifices 

 for the promotion of your indus- 

 try, and I want to ask again that 

 you stand behind him in the big 

 work he is doing. 



Association work should be 

 educational in a high degree and 

 a careful study of anything that 

 enters into the production and 

 marketing of lumber is a proper 

 function of any association. Cor- 

 rect information as to stocks on 

 hand, production, volume of 

 business and prices received, 

 should be carefully gathered and 

 distributed. You are all ac- 

 quainted with what the Hard- 

 wood Manufacturers' .Associa- 

 tion has done along these lines, 

 but will probably be interested 

 in knowing that it has in pro- 

 cess of development an educa- 

 tional campaign whicb will be 

 much more broad and far reach- 

 ing than anything it has at- 

 tempted in the past, one phase 

 of which will have to do with 

 the dissemination of price infor- 

 mation. 



This plan is what is known 

 as "The Open Price Plan" as ad- 

 vocated by Arthur Jerome Eddy 

 in his book — "The New Competition." 



On this occasion it is but natural that we should pause and look both 

 backward and forward. Our backward look will not profit us unless we 

 realize the mistakes we have made and place them as "danger signals" 

 for our guidance in the future. Our forward look will profit us greatly 

 if we fully resolve to profit by past mistakes and to actualy do the things 

 which we feel and know will benefit this organization and all of its mem- 

 bers. We are entering into a year that holds, tor general business, more 

 in store than any previous year. Briefly summarized, as I see it, the 

 outlook for 1917 is, owing to circumstantial necessity, of unprecedented 

 brightness. There is no potent reason, so far as I am able to see, why 

 the lumber industry should not share in this general prosperity. Our 

 greatest needs are more loyal support to organized effort, closer co- 

 operation, development of accurate cost accounting, uniform standard of 

 inspection, thereby producing legitimate competition and better values. 



FOR 



