38 



HARDWOOD RECORD 



it cost him $2.12 a thousand to handle his stock. That is to say, 

 the yard expense of all the lumber handled in the course of a year 

 was $2.12 per thousand l<iet. The other man figured out a cost 

 of $2.04 per thousand feet, this including all operations, both to 

 the pile and from it. It must be added, too, that the per diem 

 man is an unusually efficient operator, and knows how to get the 

 most work out of his men under his system of handling. 



The difference of eight cents doesn't look large, but when figured 

 up into the millions of feet it is easy to realize that it may make 



a great difference between no profit at all and handsome earnings. 

 As a matter of fact, in view of the large volume of business done 

 and the number of savings which are possible on lumber handling, 

 it seems to be here that the hardwood man has the best chance to 

 pay his dividends. If he can sell lumber on the same basis as his 

 competitor, and yet save eight or ten cents a thousand on his yard 

 expenses, he can make money while the other man is trying to 

 get the banks to extend his line of credit more than they care 

 to do. G. D. C, Jr. 



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A Preachment on Sales Methods 



Editor's Note 



The following analysis was written by a well-known lumber wholesaler, and generally reflects the legitimate 

 jobber's position on the important subject of lumber sales methods. It is well worth perusal. 



The recent article in the Hakdwood Record, on "Who Will 

 Survive?" leads me to make a few plain statements in favor of the 

 legitimate wholesaler. 



Do you realize that almost nine-tenths of all lines of products 

 to-day are marketed through wholesalers? And isn't it logical that 

 they should be— the wholesaler's trade lies in a certain well defined 

 section; he is in dose touch with his customers, watches their 

 accounts closely, accommodates them in money matters and in 

 general goes out of his way to accommodate them and hold their 

 trade. What chance has the mill, situated in a small place, 

 worried with logging and manufacturing conditions, of taking 

 interest in consumers far off! Generally, the owners of these mills 

 are not the kind of merchants to arrange for effective distribution. 

 A large producer of lumber wishing to sell his stock at the 

 lowest selling cost, will do well to dispose of his lumber through 

 legitimate wholesalers. The wholesaler is on the job in his section 

 to look out after the mill's interests, as well as to protect his 

 customers and see that each gets a square deal. He is in line 

 with the market prices and keeps in close touch with the ever- 

 changing conditions of his market. 



It is all very well for a millman to make a visit to the consum- 

 ing trade, get thoroughly lined up as to the stock each uses, etc:, 

 but he will find that the requirements will change almost before 

 he returns to the mill. 



The way some millmen handle their sales end is almost a farce. 

 They will spend months studying the manufacture of their product, 

 trying new machinery, etc., in order to reduce manufacturing 

 fosts, and then put some incompetent clerk in charge of the selling, 

 who, in turn, will quote a ridiculously low price, just because the 

 cost has been lowered a little. This one low price in a market 

 will have a depressing effect on the whole market. Reduce your 

 manufacturing costs if you can, but why reduce your price? As 

 one well-known authority says, "What does it cost you to make 

 your lumber? If you cannot tell exactly, you do not know whether 

 you are making a profit oi not. Profits flo not necessarily follow 

 immense or increased production. Profits are the honest reward 

 for well-directed effort. Unless you take your profit you are not 

 doing your duty to yourself, your business or society. ' ' 



Too many mills underestimate the value of co-operation with 

 the wholesaler. They think more of the dollar or two per thousand 

 they can get by selling direct to the consuming trade. Nine times 

 out of ten, the wholesaler jiays cash, settles without a kick and has 

 the mills' interests at heart, while the consumer who buys from 

 a mill far off, has them at his mercy, often makes a claim, generally 

 gives a note and the mill stands for it. The wholesaler probably 

 buys fifteen cars to the consumer's one — the mills overlook this 

 fact. Nine times out of ten, bad accounts on the mill's books are 

 the consumers. The legitimate wholesaler is familiar with condi- 

 tions at the mills and you will find most of his class visiting the 

 tnills regularly. His customers get to know this and depend on 

 what he says. Could the mills want any better representation? 

 Could they put out a salesman at any price, to represent them 

 better? 



At the recent convention of the Sales Managers' Association, 

 in Chicago, one of our foremost manufacturers said: "Let us take 

 off our hats to the real lumber merchant, the balancewheel of the 

 lumber business, and the shrewd judge and dictator of lumber 

 values — the legitimate wholesale jobber. The successful jobber 

 specializes on personal contact with his customers, and we pro- 

 ducers, who sell the wholesaler at a price that his definite and 

 specific knowledge enables him in turn, to advance to the consumer, 

 must acknowledge the ett'eetiveness of his methods." He's dead 

 right, and when a millmau of experience makes this statement, its 

 something to be considered. 



Mr. Mill Man, when you have a car turned down that was sold 

 direct to a consumer, whom do you turn it over to? The most 

 reliable wholesaler in the market, don't j-ou? He'll handle it for 

 you and do it right and get its worth for you. Why didn 't you 

 let him handle it in the first place? 



Here is an example of another practice that some mills resort 

 to: One large manufacturer writes that he has several cars of a 

 certain thickness of poplar at a certain price, on a cash basis. 

 Then he turns right around and sells a car out of the lot direct to 

 a consumer, at a dollar less; and in this case the consumer gives 

 a long-winded note. Can you beat that for salesmanship or 

 generalship? 



Within the past three months fully thirty mills have adopted a 

 new price-list scheme. These mills mail stock-sheets with prices 

 to consumers. They also mail the same stock-sheets to the whole- 

 sale trade, but subject to a five per cent discount. Now, are these 

 mills favored by the wholesaler in buying? You bet they are, for 

 the\' are doing the right thing by the wholesaler and the mills 

 have the wholesaler's co-operation. 



I am in receipt of a stock sheet from a well known millman, 

 accompanied by a letter stating that he had withdrawn his sales- 

 men, and in the future will market all his stock by mail and 

 through the wholesale trade — allowing the wholesaler a discount of 

 $3.00 per thousand. 



If the manufacturers did sell direct for a dollar or two more 

 per thousand, wouldn't they have to add just so much more per 

 thousand, to cover sales costs by means of salesmen, etc., and 

 wouldn 't the cost be greater than by marketing through whole- 

 salers? About a year ago, a very large millman decided he would 

 bid direct to the consumers, so abandoned all his wholesale trade, 

 employed salesmen and went to a heavy expense. After losing 

 considerable money in bad accounts, he is now glad to again market 

 his stock through the wholesaler. This experience is not an 

 isolated one, and speaks for itself. 



The legitimate wholesaler of to-day has the most effective and 

 logical means of distribution. He is well known in his market; 

 has a steady trade, is a specialist in marketing lumber, and repre- 

 sents to the millman the lowest selling cost. Go ahead, Mr. Mill 

 Man; devote your time to reducing manufacturing costs — you're a 

 specialist in manufacturing — know your cost, add your profit, then 

 put your stock-sheet and prices in the hands of the legitimate 

 wholesaler. Think it over. 



