PURCHASING EQUIPMENT AND SUPPLIES 125 



absolutely needed. Goods are often bought because they are 

 cheap and it is expected they will be needed later on. A few 

 mistakes of this nature will be suflBcient to reduce the annual 

 dividend several per cent. In order that the buyer may know 

 what is needed it is well for him to keep a want book in which 

 to write down articles needed so that they may be ordered to- 

 gether with the next regular order. 



HOW TO BUY 



Contracting for a Year's Supply. — Most creameries buy 

 supplies in small lots, placing orders for them with various 

 dealers. For that reason the dealers find it necessary to have 

 their traveling solicitors make frequent calls in order to be as- 

 sured of their share of the business. The cost of such calls is 

 naturally charged up against the cost of selling the goods and 

 the buyer has to pay the expenses. Many of such expenses 

 could be eliminated if creamery managers would estimate the 

 amount of supplies required for the coming year. This is read- 

 ily done, especially after a creamery has been operated for a 

 year or more, as its requirements will vary from month to month 

 much as they did during the previous year. A buyer should be 

 able to estimate to a fair degree of accuracy if the business will 

 show a general decrease or increase for the year. The inventory 

 record of supplies for the previous year will present a fair esti- 

 mate of the proportion of the supplies needed for each month of 

 the coming year. Therefore, whenever submitting an order to 

 dealers for bids they may be requested to submit bids under 

 various specified conditions. For example, a buyer might re- 

 quest that dealers submit bids on the entire order to be shipped 

 in one shipment at a definite stated time, also that they sub- 

 mit bids on the same order to be shipped in four separate ship- 

 ments, each shipment to consist of a definite stated quantity 

 which will naturally vary in accordance with the demand; as a 

 third bid he might request dealers to submit bids on monthly 

 shipments in amounts as stated by the purchaser. 



In determining the size of shipment to take at each delivery 

 a buyer should consider the difference in cost, amount of money 



