SELLING LUMBER 



303 



Some salesmen have enormous sales, but the cost of selling 

 is so great that it offsets the profits. Other salesmen may only 

 sell one-half the quantity in a given length of time and yet the 

 net profit on their sales may be greater than the man who holds 

 the record for volume. Volume is a fine thing under certain 

 conditions, which I will enumerate, but it is all wrong unless it is 

 accompanied by profit. 



Profits, as made in the wholesale lumber business, may be 

 created in two ways. First, by the margin or difference between 

 the cost of the lumber delivered at destination and the price at 

 which it was sold. From the profit, which is termed the "gross 

 profit," the cost of selling the lumber must be deducted, which 

 leaves the net profit. If the gross profit on a car is only $20 

 and it costs $8 per car to sell it, your net profit on that car of 

 lumber is $12. Therefore, if you have a fixed market price at 

 which you must sell your product there is only one other way 

 you can increase the profit, and that is by decreasing your expenses 

 or by increasing your sales without increasing the expenses. Thus, 

 if you sell sixty cars this month and your expenses are $200 for 

 the month, it has cost $3.33 per car to sell. But if you can sell 

 120 cars this month without increasing your expense account, the 

 cost of selling is only $1.67 per car. But, if you double your sales 

 from 60 to 120 cars per month and double your expenses also 

 from $200 to $400, your cost to sell per car is exactly the same 

 on 60 cars as it was on 120 cars. 



Therefore the efficient traveling salesman watches his ex- 

 pense account, he keeps in close touch with his record of cost to 

 sell ; he strives from month to month to increase his profit, to 

 reduce his expenses, and to decrease his cost to sell per car. Are 

 you efficient in this respect? If so, to what extent? 



21. Knowledge of Human Nature, Psychology. 



One of the most superb mental qualifications for a traveling 

 salesman to possess is the ability to quickly judge human nature. 



The faculty is, to a larger extent, intuitive; or I might bet- 

 ter express it by saying that the ability to judge human nature 

 is a species of psychological instinct. 



This is the faculty which will tell you almost what your cus- 

 tomer is thinking about when you are trying to convince him 

 that he should give you the order, and it enables you to antici- 

 pate his objections or questions before he has uttered them. This 



Economical 

 Selling Means 

 Increased 

 Profits 



The Faculty 

 of Judging 

 Human 

 Nature. 



