HARDWOOD RECORD 



29 



amount of business it diel. and the condition of the business at that 

 time. He would have to know how much money had been borrowed 

 previously, and for what it was to be used. The banker is required 

 by law to ascertain much information of this kind, and for his own 

 protection he gets a great deal of it; and while no lumberman would 

 want to go into as great detail regarding his customer's business 

 as he has when he confronts the banker, asking for credit, it certainly 

 seems that he should have no hesitancy in seeking answers to at least 

 a few leading questions of that kind. 



He ought to be able to get a financial statement, when he wants 

 it. from concerns which have not established themselves as sound. 

 New accounts being op"ened should be handled carefully along this 

 line, for then is the proper time to ask and get the data which 

 should be at hand. It is not necessary to ruffle the feelings or the 

 temper of the man at the other end of the line; but a tactful and 

 courteous letter, explaining that the lumber company makes a rule 

 •of acquiring this information in opening new accounts, would be cer- 

 tain in most cases to elicit the information promptly and cheerfully. 



To show the laxity which prevails among lumbermen as to credit 

 matters, an automobile concern recently started up in a middle- 

 western city. Tile concern had been organized with a great blare 

 of trumpets and much newspaper advertising, for the purpose of 

 .stock selling, and business men who had watched its progress were 

 not any too sure of its chances for success. It prepared to begin 

 business, however, and ordered enough lumber to enable a good many 

 cars to be made up. 



At the same time it placed a contract with a large concern dealing 

 in iron and steel, axles, springs, and the like, for supplies of this 

 character. The latter concern took the contract, but stated that it 

 would not be able to extend credit until the manufacturer gave a 

 satisfactory financial statement. This the automobile concern was 

 •evidently not in a position to do, for it delayed complying with this 

 requirement for several months. Meanwhile it received some material 

 which had been shipped with the understanding that a draft would 

 be attached to bill of lading. All the steel it got was paid for in cash. 



A few months later the company was flat broke. A receiver took 

 liold of it, wound up its affairs and sold its possessions, realizing 

 little more than enough to pay twenty-five per cent of creditors' 

 claims. The lumbermen who had taken orders for stock had in every 

 instance shipped the material, and consequently were stung to the 

 extent of seventy-five per cent of their invoices, while the steel people 

 didn't lose a red cent. It is just a question of practice, of course, 

 and it might just as well have been the other way round. As long as 

 a consumer can get lumber without having to give up any information 

 of value concerning himself, the chances are that he will say very little 

 about his financial status. 



Some lumbermen are willing to be guided in this respect entirely 

 by statements of their salesmen. If the latter write that the firms 

 from which they have taken orders are all right, and can be trusted, 

 the lumber is shipped. This may work out satisfactorily if the sales- 

 man is of a judicial turn of mind, and regards the interests of his 

 ■employer closely ; but it is human nature for the salesman to be 

 prejudiced in favor of his customer, especially if he has landed an 

 order in the face of sharp competition. His report, therefore, should 

 be taken with the proverbial grain of salt, not because the salesman 

 is intentionally trying to deceive his house, but because he is likely 

 to be misled by his own enthusiasm. 



In this connection a leading hardwood man believes that it pays 

 him to spend a good deal of time on the road with his men, not so 

 much to help them sell, though this- happens, of course; but because 

 he can see things from the credit angle that his road man never 

 looks for. The salesman is hunting for opportunities to get business; 

 while the credit man, though he may create business occasionally, 

 has the disagreeable job for the most part of being at best a negative 

 factor. Hence the buoyant, enthusiastic salesman, pushing hard for 

 ■orders, is likely to overlook the small details that are of value in 

 making up the credit proposition, and to concentrate on the hard 

 problem of making the buyer want his lumber. 



The head of the house is able to look about a bit, gets 11 line on 



the business of the concern, the way it is running, the number of 

 employes, the amount of stock carried, etc., and when he leaves he has 

 a pretty vivid mental picture which will enable him to form an 

 accurate judgment of the concern when he is called upon to pass 

 judgment upon it. The salesman who is working the same list of 

 customers most of the time, of course, and is selling them fairly 

 regularly, is not likely to turn in a bad risk, but close supervision 

 of this kind is nevertheless extremely helpful. 



Local lumber organizations ought to play up strong the work of 

 exchanging credit information. Their members can discuss matters 

 of this kind in sufficient detail to enable everybody to get a much 

 better line on questionable accounts than in any other way, and there 

 is no danger of any embarrassment such as lumbermen sometimes 

 fear when asked to contribute to a symposium of credit information 

 being made up upon a given concern. 



In the latter connection, however, a well-known western lumberman 

 said not long ago that he believes the work being done by one or two 

 lumber organizations along credit lines is invaluable, and should be 

 encouraged by every member who is called upon to assist in getting 

 n line on a concern about which information has been asked. 



•'I make a point,'' he said, "of filling out inquiries about every 

 concern with which I have ever had dealings, and in the same way 

 I profit by getting reports on housfes regarding which I am in doubt. 

 It doesn't take long to get these reports up, and the experience of 

 each concern reporting on the buyer in question is quoted exactly, 

 so that the inquirer can easily make up his mind regarding him. 

 Every lumberman who wants to protect his accounts should take pains 

 to do what he can do to disseminate information of this character." 



Commerce Commission Reports on Railroad 

 Weights 



The Interstate Commerce Commission's investigation of reported 

 discrepancies and irregularities in the weighing of railroad freight of 

 various kinds has been fully reported in previous issues of Hakdwood 

 Eecord. The commission made an exhaustive investigation of the 

 complaints of v.irious shippers and has just handed down its report, 

 in ■nhieh it is declared that a majority of the track scales now in use 

 should at once be rebuilt in order to obtain reasonably accurate results. 

 The report also embodies sharp criticism of the methods of weighing 

 grain, coal, lumber and similar products, it being alleged that shippers 

 almost -invariably get the worst of the transaction. While it is prob- 

 ably true that railroads are not the offenders as frequently and as 

 flagrantly as they are supposed to be, still in this case there is no 

 doubt that their met'nods are open to the sharpest criticism. It is 

 to be hoped that the report of the Interstate Commerce Commission 

 will result in their changing not only the actual scales but their 

 methods of weighing. No action will be taken until later in tiie year. 



— Ci. D. C, Jr. 



Car Surplus and Shortage 



Bulletin No. 149, issued by ihe American Railway Association, 

 gives the statement of freight car surplus and shortage up to Aug. 1. 

 The total surplus on that date was 67,716 cars as against a surplus 

 on July l.T of 76,280 cars. The surplus Aug. 1, 1912, was 65,904 cars. 

 Total shortage on Aug. 1, 1913, was 11,261 ears and on July 15 was 

 6,875 cars. The shortage on Aug. 1,-1912, was 9,394 cars. 



Thus it can be seen that a suggestion of a serious car shortage is 

 based on actual facts. 



Kecipe for a modern log wagon — Cross a motor truck with a trac- 

 tion engine to get the wheels and then trade the mules off for their 

 value in gasoline. 



The frankly cheerful salesman is one who generally gets his full 

 share of the orders going, and while he is about it he has a much 

 better time and makes many more friends than the grouch or the 

 man with a whine. You needn't attach a moral to this — just take it 

 as a plain fact. 



