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THE MUSIC TRADE REVIEW
fourteen in 1893, this again pointing to the
less notable tendency toward failure in the
DRY READING MADE INTERESTING THE PRI-
case of larger traders in years which, like
MARY CAUSES OF BUSINESS EMBARRASSMENTS
1897, more nearly approached the normal.
CAPITAL THE CHIEF STUMBLING BLOCK.
The causes of business failures have here-
tofore
furnished a most interesting subject of
The last issue of Bradstreets contains a
statistical
research, and here again the show-
very interesting table and article concerning
ing
made
has
been a most exhaustive one.
failure statistics and their meaning. From
In
considering
the causes of business embar-
this source we learn that the number of busi-
rassment
it
should
be borne in mind that the
ness firms in the United States in 1897 was
causes
assigned
are
those to which failures
1,086,056, in Canada, 86,975, making a total
are
primarily
due.
For this examination
of 1,173,031. The number of failures in the
eleven
primary
causes
of business embarrass-
United States for that period was 13,083, in
ments
are
classified
as
follows:
Canada, 1,925, making a total of 15,008. In
A.—DUE TO FAULTS OF THOSE FAILING.
1896 the figures stood as follows: Number in
I. Incompetence—(1) Incompetence (irrespective of other
business in the United States, 1,079,070, in
causes); (2) Inexperience, without other incompetence;
(3) Lack of capital, or the reverse—i. e., trying to do too
Canada, 82,978, total 1,162,048. The fail-
much business for capital employed, and (4) Unwise
ures in the United States for that period num-
granting of credits.
bered 15,094, in Canada, 2,204, making a total II. Neglect of Business— (1) Speculation (outside regular
business); (2) Neglect (due to doubtful habits); (3) Per-
of 17,298.
sonal extravagance.
An estimate of capital employed by those III. Fraudulent disposition of property.
B.—NOT DUE TO FAULTS OF THOSE FAILING.
who failed is found by referring to these sta-
Disaster (flood, fire, crop failure, commercial crisis).
tistics. Of the 15,008 failures in 1897, 88.9 IV.
V. Failure of others, of apparently solvent debtors.
per cent, were those of traders having only VI. Special or undue competition.
The primary self-responsibility of failing
$5,000 capital or less. In 1896 the propor-
tion of such small traders was eighty per traders for a large part of their own lack of
cent., and it is necessary to go back to the success is intimated by the figures, which
year 1892 to find a percentage as high as that show that two-thirds of all the persons failing
of last year, pointing to a normally greater in 1897 did so from causes proceeding from
mortality among the smaller traders, with a their own faults arid not from extraneous cir-
naturally smaller percentage of failures among cumstances. For instance, the failures com-
the large dealers, and also pointing to a closer binedly due to Lack of Capital, Incompe-
scrutiny of credit by those in a position to ex- tence, Inexperience, Fraudulent Disposition,
tend and to report upon such credit. Of the Personal Extravagance, Unwise Granting of
traders failing in 1897, 7.6 per cent, were Credits, Neglect, and Speculation constituted
those having between $5,000 and $20,000 67.4 per cent., or over two-thirds of those
capital, as against 13.7 per cent, in 1896, 8.6 occurring, while the failures due to Disaster,
Failures of Others and Undue Competition
per cent, in 1895 and 7.6 per cent, in 1894.
Again, it is necessary to go back to the made up the balance, 32.6 per cent. It may
year 1892 to find a smaller percentage of this be stated also that the proportion failing in
class of traders failing than was the case in 1897 through their own fault was slightly
1897. Two per cent, of the traders had a larger than it was in 1S96, the percentage in
capital of $20,000 and less than $50,000, and the latter year being 66.2. Lack of Capital,
here again the decrease from 1896, and in of course, constitutes the chief stumbling-
fact every year since 1892, is a marked one. block of those who fail in business. During
Traders employing between $50,000 and the year 1897 the total number so failing
$100,000 capital made up only six-tenths of amounted to 4,108, or 31.4 percent, of the
one per cent, of those failing, and the same is total. This was about the same percentage
true of those employing between $100,000 and as in 1896, and smaller than in any previous
$500,000 capital, whereas in 1896 the percent- year on record.
age was 1.5 per cent, in each case. Those with
Since 1893 particularly the second cause in
$500,000 capital, and over furnish .03 per relative importance of business embarrass-
cent, of the total number of failures, which is ments has been that of Disaster, in which, as
the smallest percentage of failures reported the above statement will show,, has been in-
in this class since the record year 1892. It cluded embarrassments due to commercial
is of interest to know that only two traders crises, fires, floods and crop failures. Slight-
with a capital of $1,000,000 or over failed in ly more than one-fourth of all the failures in
1897, against two in 1896, one in 1895 and 1897 are attributed to this second cause, as
compared with 27.5 per cent, in 1896, 24.9
percent, in 1895 and 25.9 per cent, in 1894.
Other important causes of failures are
those of incompetence, which accounted for
12.3 per cent, of the number of failures, and
Fraudulent Disposition, which amounted to
10.2 per cent. There appears to have been
a larger percentage of failures due to this
latter cause in 1897 than in any of the three
preceding years. Inexperience accounted for
5.6 per cent, of the failures of 1897, a larger
477-481 Clybourne Avenue,
percentage than for some years past, and the
same is practically true of Undue Competi-
CHICAGO, ILL.
tion, which accounted for 5.2 per cent., a
considerably larger proportion than in any
year since 1894.
^-Catalogue sent on application.
Failure Statistics Analyzed.
SmiTH £ SHIES
piano
On the other hand, failures due to Unwise
Credits, which made up 3.5 per cent, of all
failures, Speculation, which accounted for
eight-tenths of 1 per cent., and Failures of
Others, which accounted for 2 per cent., show
a considerable decrease alike in number and
percentage from preceding years. Slightly
over 1 per cent, of all the failures are cred-
ited to Personal Extravagance, while 2.5 per
cent, are charged to Neglect of Business.
Liabilities of failing traders show some
variation from the percentages above given.
For instance, 31.4 per cent, of the failures
were due to Lack of Capital, but only 23.6
per cent, of the liabilities were chargeable
to failures from this cause, pointing to the
influence of credit and capital ratings upon
those extending credit being toward restric-
tion. Twelve per cent, of the number, but
only 10 per cent, of the liabilities, were
due to Incompetence. Statistics of failures
owing to Fraudulent Disposition show that
10.2 percent, of the failures and 11.6 per
cent, of the liabilities were due to this cause.
Of the failures due to Inexperience 5.6 per
cent, was the proportion as to number, but
only 1.7 per cent, as to liability. Outside
Speculation, which accounted for eight-tenths
of 1 per cent, of the number, was re-
sponsible for 5.1 per cent, of the liabilities.
Both Cases Were Dismissed.
HAINES AND STOCKHOFF ESCAPED THROUGH
A TECHNICALITY.
[Special to The Review.]
Louisville, Ky., Jan. 24, 1898.
L. H. Haines and William Stockhoff,
charged with grand larceny, were dismissed
in the Police Court Thursday without the
evidence being heard.
They were arrested on a warrant sworn out
by Mr. Cohen, a detective in the employ of
the United States Guitar & Zither Co.,
by whom they were employed, the former as
salesman and the latter as book-keeper. The
detective alleged that Haines sold instru-
ments and Stockhoff " managed " the books,
thus securing in the neighborhood of $600.
When the case was called Prosecuting At-
torney Thurman and Attorney Caruth stated
that the musical instrument company was not
an incorporation.
They both agreed that
the grand larceny charge could not be sus-
tained, and the warrants were dismissed by
Judge Thompson.
The "Crown" is an Inducement.
The Rochester (N. Y.) Herald is offering
a " Crown " piano as a prize in a " subscrip-
tion contest." The Herald says: " T h i s
beautiful and valuable instrument is from the
celebrated factory of Geo. P. Bent, of
Chicago, and is one of the leaders of the
well-known house of J. W. Martin & Bro., 73
State street. It is a perfect and modern
piano in every respect. It has moreover at-
tachments of great value that have never be-
fore been placed in any make of piano."
)
Chas. Swanson, formerly a piano tuner, at.
tempted suicide by cutting his throat at Hay-
ward, Wis., a few days ago. He is in a pre-
carious condition.