HARDWOOD RECORD 



33 



the lumber in considering prices, as he knows he will get from 

 any association mill as near the same grade as it is possible for 

 <lifferent men, working under the same instructions, to make it. 

 This work can only be carried on by an association. 



It is necessary, from time to time, to change the grading rules 

 to meet changing conditions, and as new uses for lumber are 

 found it is necessary to establish standard sizes and specifications 

 covering the various grades. The association is performing this 

 duty as occasion requires. 



The Yellow Pine Manufacturers' Association has a large force 

 of trained inspectors, directed by a chief inspector, visiting the 

 mills, educating the graders and seeing to it that a uniform stand- 

 ard is maintained. The Yellow Pine Manufacturers' Association 

 expends about $35,000 a year for this service, and it believes that it 

 is wo-th it. 



In this connection there is another serious side to this question. 

 As stated before, practically all yellow pine lumber is sold on asso- 

 ciation grades. The manufacturer who does not belong to the asso- 

 ciation uses the association gauges for sizes and its rules for in- 

 spection, and undertakes to have his head grader competent to 

 maintain association grades; but, by reason of not having a regu- 

 lar review of his stock by a trained association inspector at regular 

 intervals, who is constantly visiting and inspecting his competi- 

 tors' stock, and whose business it is to point out errors, either of 

 manufacture or grading, or by reason of frequent changes in 

 employes, his grades, in time, lack uniformity, and the experience 

 of the association has been that these stocks are very apt to aver- 

 age better than association grades. They can not be below grades 

 without bringing complaint from the buyer, while the buyer would 



not be likely to complain if he received a little better grade than 

 be expected. 



The manufacturer who does not belong to the association, but 

 feels confident that he is correctly grading his lumber because it 

 seems to please his customers, is in a very dangerous position, and 

 may be giving away every year thousands of dollars in furnishing 

 better lumber than he gets paid for. and it would be money well 

 expended to pay association dues and have the benefit of a disin- 

 terested expert inspection from time to time. 



I wish to call attention of the members of the association to the 

 fact that possibly they have not derived as much profit from their 

 investment in association dues as they would have, had they care- 

 fully studied the information sent out by the secretary. The asso- 

 ciation prepares a lot of valuable reports and statistics. Its mem- 

 bers are accurately informed of conditions affecting our industry. 

 We are told the ratio of cut to shipments for any given month; 

 comparative statement of stocks in the hands of manufacturers, 

 and other information of like nature that, if acted upon, would be 

 a large factor in determining values. It requires an expensive 

 organization to collect this information. 



Y^ou are paying for it in the form of association dues, and it 

 would seem to be good business to utilize this information to the 

 fullest extent to the end that your expenditure for association 

 dues may pay dividends. Such information should be scrutinized 

 as carefully as your balance sheet, for that is precisely the place 

 where it will ultimately be recorded. 



Keep constantly in mind that success is only a synonym for 

 "being prepared," and that anticipating conditions is merely 

 ascertaining what seed is now being sown. 



• ^i ;>50it:a^m^»iiro?TOM;M)Maimii)iiBtwto;^^ 



Five years ago, according to a recent statement of one of the 

 largest lumber manufacturing concerns in the country, it was able to 

 sell its product i<x less than one per cent; today, the cost is from 

 two and one-half to three per cent, and is going up right along. 

 This, be it noted, is a strictly selling cost, and does not include any 

 of the general or overhead expense, part of which is connected with 

 selling. It refers to the actual expenses of the man who is on the 

 road getting orders; of the advertising department, and of special 

 work which may be done with a view to promoting the sale of lumber. 



Everybody has probably realized during the last few years, with 

 the after-effects of the depression of 1907 and 1908 prominently in 

 mind, that it takes more effort to dispose of lumber than it formerly 

 (lid. Many, however, have not understood fully to what extent extra 

 effort had resulted in an added sales expense. The two are directly 

 connected, and one inevitably produces the other. If a salesman has 

 ■ft) call on a buyer three times to make a sale, whereas he formerly 

 sold him on every trip; if purchases are made by cars instead of lots 

 of 100,000 feet at a time, and if better terms have to be given to get 

 orders, it does not take much analysis to understand why selling 

 expense has increased. The cost of doing business has grown all along 

 the line for the lumberman, and though he has been more impressed, 

 perhaps, with the advance in the cost of timber and the increase in 

 labor expense, the sales department is one which is responsible for a 

 considerable amount of this increased burden. 



This means that lumbermen must pay more attention to proper 

 selling methods if they are to continue to make a fair profit and to 

 hold the selling expense down to its present figures. The association 

 of sales managers, which is doing good work in the exchange of ideas, 

 calls attention to the need of better methods, and the promotion of 

 sales is beginning to get the consideration which it deserves. Con- 

 tinued attention to this problem is needed in order to bring that 

 department of the business up to its maximum efSciency. 



The head of a big company used to find enjoj-ment in selling the 

 output of his mill. He sat in his ofBce, dictated a few letters to big 

 consumers, whom he knew personally, in which he offered certain 



choice lots of stock. Usually a reply was forthcoming, accepting the 

 offer, and the lumber was moved within a reasonable time after it 

 was manufactured. This lumberman had the idea that there was no 

 selling expense attached to his business. He figured that it took about 

 two cents' worth of postage and ten or fifteen cents' worth of the 

 time of his stenographer and a trifling amount of stationery to land 

 an order for about 50,000 feet, and he believed that this was the 

 proper way to handle the selling department. 



When buying slowed up a few years ago, the manufacturer con- 

 tinued to solicit business from his customers by mail. He found, 

 however, that the amount of postage required to land an order was 

 considerably more than it used to be, and that a good many of his 

 "steadies" wrote polite notes stating that they had plenty of lumber 

 in stock, and could use nothing additional at that time; also that 

 they were getting quotations elsewhere which were considerably lower 

 than his own. With lumber piling up on his yards, the sawmill 

 operator saw that it was necessary to discontinue the old easy-going 

 methods, and he employed a man who had devoted much attention to 

 sales work. This man is now at the head of the selling end of the 

 business. He is getting $4,000 a year to handle this part of the 

 business, and his traveling expenses amount to fully that much. With 

 the services of his stenographer and the other incidentals which 

 accumulate about such a position, the selling department costs the 

 business easily $10,000 a year, compared with the negligible amount 

 which was formerly charged to it. 



Here is just one concrete example of the change in conditions, and 

 one definite reason why the cost of doing business has advanced. 

 Many other lumbermen who found it unnecessary to employ salesmen 

 now have men on the road regularly, and concerns which thought that 

 the same man who could see that the sawmill was running properly 

 could also attend to the minor detail of moving the stock after it was 

 piled, have changed their minds and gotten experts for the selling 

 work, allowing the manufacturing department to remain in the hands 

 of those whose chief business and skill are concerned with the sawing 

 of lumber and not the selling of it. 



