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THE MUSIC TRADE REVIEW
10
METHODS OF TRANSACTING BUSINESS IN FOREIGN LANDS
Wm. Tonk, of Wm, Tonk & Bro., Inc., Addresses Export Round Table at Convention of Na-
tional Association of Manufacturers, on the Handling of Export Trade, Particularly in the
West Indies and South America—Able to Talk from Experience in His Special Field
Many look upon export business as something
quite out of the ordinary. This, to my mind, is
owing mainly to inexperience, which would nat-
urally lead to erroneous and exaggerated ideas
regarding things to be done in far-off and un-
known countries.
It is a good deal like trying to move about
in the dark, when the smallest kind of light
would readily show you the way. When this
little light is supplied, it will be found that meth-
ods of doing business in foreign lands do not
materially differ from those that obtain at home
and that, in fact, are prevalent all over the civil-
ized world.
To those who desire to exploit this kind of
business, I have the following to say:
The agencies employed in the exploitation
of foreign trade are a good deal the same as
those we use in our own country. Among
these, I would mention:
1. Solicitation by correspondence and circu-
lar propaganda.
2. Personal solicitation.
3. Advertising in export and other papers.
Solicitation by Correspondence
This is, perhaps, the first that should be un-
dertaken; and it should by all means be car-
ried on in the language of the country towards
which it is directed.
This kind of propaganda is not determined
by any hard-and-fast rule, but may be diversi-
fied according to the ideas of the home mer-
chant. Correspondence, as we know, should at
all times be in polite and effective language, and
should be especially polite when directed to
Spanish or Portugese-speaking countries. Busi-
ness men of the Latin race are extremely polite
in their social intercourse as well as in their
correspondence, and, naturally, look for similar
courtesies from those who seek their patron-
age. Solicitation by correspondence is, perhaps,
the cheapest propaganda that may be employed,
although favorable results from the same are
not apt to follow quickly. I would say that
some of our largest and most important cus-
tomers were secured through efforts of this
kind.
I would call attention once again to the im-
portance of carrying on correspondence in the
language of the country to which attention is
directed. Letters and circulars to such coun-
tries in the English language would be simply
wasted.
Solicitation by Traveling Salesmen
The most direct and effective method that
may be employed is by personal solicitation;
or, in other words, by traveling salesmen. This
—when you employ your own salesmen—is by
far the most expensive, and can be successfully
undertaken only by large houses offering goods
that have an extensive field.
You may, however, place the sale of your
wares in the hands of salesmen who, as a rule,
represent more than one house, in lines that
do not compete with each other. A combina-
tion of interests of this sort distributes the cost
and naturally makes it very much cheaper for
each of the interested parties.
There are men who make this kind of travel-
ing their sole business. Some go to Porto Rico
and Cuba and, possibly, to Central America.
Others specialize in South America. They all
speak Spanish and some Portugese also, and
vary in experience and capacity a good deal
the same as the men that are active in the home
trade.
Arrangements with these men usually com-
prise a fixed allowance for expenses for a given
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period, a commission on all goods sold by them
on the trip and also on orders that may come
direct, within a stated time, as a result of their
efforts.
A good conscientious salesman will always
do some business although seldom sufficient
to pay the expenses of the trip. The bulk of
these must come, and usually does come out
of the business that follows from the trade
lie has established.
To nearby countries these trips should be
repeated every year or even oftener; to South
America, perhaps every two years.
Large
houses in certain lines have resident salesmen
in many, if not all, of these countries.
Exploitation by Advertising
The third agency mentioned for the further-
ance of foreign trade is advertising in trade and
other papers. I will not dwell long upon this
for you all know the advantage of newspaper
advertising.
However, I would venture the opinion that
this kind of advertising would be profitable only
for lines that have an extensive field.
There are a number of export papers pub-
lished in the City of New York, a list of which
may be obtained through the National Associa-
tion of Manufacturers. In fact, this association
itself publishes a paper of this kind.
Now, the success or failure of any effort will
depend in a great measure, if not altogether,
upon several conditions, namely:
"Are you willing to compete with quality,
prices, and terms of the product of other coun-
tries?"
In order to be successful, you must be able
and willing—
First. To furnish the style and quality of
goods demanded—your style, if not in favor in
the foreign trade you seek, will not do.
Second. You must be able and willing to sell
as low as, and possibly a little lower than, the
goods can be obtained for from English or con-
tinental markets; for, as a rule, freights from
such ports are cheaper than from American
ports.
Third. Are you able and willing to extend
the terms prevailing in those countries?
As in all countries, staples command cash.
Goods not staples are sold on terms varying
from one to six months (in exceptional cases,
even longer time is granted), a good deal the
same as they are in the home market.
There are a number of reasons, why American
goods are not more successful in the South
American countries, and one of them in particu-
lar is that we are not so liberal in granting terms
as are shippers of other countries.
A case recently came to my notice wherein a
New York firm refused a South American or-
der, because the buyer asked to pay against
sight draft with documents attached; in other
words, C. O. D. Cash in advance was demanded
or no sale; there was no sale.
The risk of giving credit is a good deal the
same as in our own country, except that it may
be somewhat greater because of distance, and
the fact that the process of collecting is fraught
with difficulties and expense.
When firms are not well rated, I recommend
"hands off," unless the conditions are that pay-
ment follows through some New York com-
mission house on delivery of documents. In
such cases the order usually comes through
such a house, which guarantees payment on
delivery of documents, or within ten or thirty
days, and usually expects a commission.
The character and standing of merchandise in
the countries under discussion, as well as in other
countries, may be ascertained through the usual
channels, i. e., mercantile agencies, banks and
the National Association of Manufacturers.
The reports furnished by the last have been
most satisfactory to my house. The better class
. of merchants usually submit references volun-
tarily.
I would say here that it is customary to close
all transactions, other than cash, by acceptance
whether on short or long time, the process be-
ing to make drafts for the amount and terms