Music Trade Review -- © mbsi.org, arcade-museum.com -- digitized with support from namm.org
MAY
24, 1919
THE MUSIC TRADE
REVIEW
CO-OPERATION ESSENTIAL TO
SUCCESS IN THE EXPORT FIELD
Consistent and Persistent Effort and Willingness to "Go the Limit" Will Bring
Profitable Results, Says R. M. Fullerton in Special Interview
As has already been announced informally, one
of the important questions to be taken up at the
convention of the National Piano Manufacturers'
Association in Chicago will be that of the or-
ganization of an export bureau of some kind
under association auspices, and for the assist-
ance of association members who have entered
or desire to enter foreign trade fields.
It has been suggested that this new develop-
ment should take the form of a thoroughly or-
ganized bureau, capable of handling all matters
associated with the successful exporting of
pianos and their exploitation in foreign fields.
Another suggestion is that a less expensive
course would be to provide the services of an
expert in foreign trade to advise piano exporters
in their problems and leave the actual solution
of those problems to the manufacturers them-
selves. Still another thought that has come to
some of the live members of the trade is that a
special organization of piano exporters should
be inaugurated under the provisions of the Webb-
Pomerene Act for the purpose of handling the
export business of its members, including survey
and exploitation work in foreign fields, shipping,
financial and other problems of exporting on a
pro rata basis.
Manufacturers Favorably Inclined
As a matter of fact, the majority of those who
have been approached seem to favor the latter
plan, fofTfis urged it would enlist the support
only of those actually interested in export busi-
ness, and would appeal to them by providing a
trade development service beyond the limitations
of the individual concerns, and through the divi-
sion of the overhead serve to reduce the foreign
selling expense of the various members, whether
individuals or corporations.
In seeking to develop export trade the rule
should be "go the limit." In other words, con-
sider the matter seriously enough to make a
direct, consistent- and persistent effort to build
up export business along substantial lines. This
is the opinion of those who have made a special
of export conditions and the prospects
.along that line just at present. Conditions sur-
rounding the development of export trade were
summed up for The Review by R. M. Fullerton,
in charge of the export trade development work
of the National Association of Manufacturers.
"Export trade must primarily be regarded in
its broader aspects," said Mr. Fullerton, "for it
is in its essence one nation trading with an-
other. Many problems entering into it are,
therefore, strictly problems of broad relations,
calling for broad organization for their proper
handling. Such organization, in its turn, per-
mits of economies of operatiqn, a standardiza-
tion of business practices and an intensive culti-
vation of the foreign market in keeping with the
full potentialities of foreign trade.
An Expert's Opinion
"Export business, in other words, calls for
concert of effort and personal touch to realize
its true possibilities. It demands co-operation
to the fullest extent in order that adequate serv-
ice can be rendered to the foreign customer, that
proper foreign representation can be main-
tained, and that sufficient economies can be ef-
fected to render fhe business profitable under
competitive conditions. The underlying idea is
to develop some definite plan of co-operation
within natural trade groups, whose affairs are
handled with strict attention to their trade con-
ditions but who as groups are in turn banded to-
gether in a broader organization competent to
handle the large relations of foreign trade.
"It is the plan of the National Association of
Manufacturers, for instance, to organize, under
provisions of the Webb-Pomerene Act, export
corporations in various foreign countries as the
circumstances warrant, each corporation to cover
a definite field, as for instance South America,
the Far East, etc. Each corporation will main-
tain a corps of general and departmental experts
and a definite organization to look after Amer-
ican export interests in countries in which it is
operating. The corporations will be made up of
groups of manufacturers in various industries,
and all these groups will be combined in order
to carry on trading on a sound, economic basis.
In the case of piano exporters, for instance—and
there are something over thirty piano manufac-
turers allied with the National Association of
Manufacturers—there could be a special group
formed, with a department in the corporation de-
signed to represent particularly the piano and
music interests.
"The thought back of these export corpora-
tions is that the export field, to be properly
worked, demands the building up of an organi-
zation and an expenditure of money and effort
beyond the facilities of the individual manufac-
turer, or even of a small group of manufacturers.
The maintenance of offices and of accredited ex-
port representatives in foreign parts, the making
of business surveys and the other factors con-
nected with the development of the trade, can
only be handled successfully on a big, broad ba-
sis, and in some measure only in a general way.
The export corporation provides for the main-
tenance of offices and representatives in every
available section, with the expense divided pro
rata among a great number of exporters, and
places only a comparatively small financial bur-
den or responsibility on any one group or indi-
vidual.
Preparations Already Made
"The National Association of Manufacturers
has already as a matter of fact organized a South
American corporation, and the plan is being fa-
vorably received. As conditions warrant, similar
corporations will be established for other parts
of the world, each corporation trading only with
one country or group of countries. The plan
upon which the South American corporation is
organized is so flexible as to serve all members
of the association regardless of their industrial
divisions. Membership in the export corpora-
tion is, of course, limited to active membership
in the association. There i^/io limitation placed
on the number of corporations td^vhich a given
number may belong, ft provides for active and
expert conduct of ttie- corporation's business at
home and abroad; for an operation based on
cost; for a departmentalized handling, where
possible, of natural trade groups within the cor-
poration; for proper agreements by members
guaranteeing the tilling of orders taken, etc., and
for an equitable distribution of business and of
sales promotion expense. The corporation is
free.;pf, association control, and yet has the full
and active assistance of that body.
"The combination of various trade interests in
the export corporation provides for advan-
tageous arrangeni^yt^teing made in the matter
of bulk shipment's and for the checking of va-
rious abuses which freiy^nUy fc £ause distress to
the indivu&tftl''^por£er'; Under this^^lan the '
ownership and control of each; corporation is en-
tirely in the hands of its stod<-h'olders. No mem- '
her may hold more than.one share, which pays
no dividends and is non-assessable, and is in-
tended solely to cover initial running expense.
With only one share per member the control of
the corporation is fairly divided.
"In addition to handling all shipments, the
export corporation plans for the raising of spe-
cial group funds for trade exploitation, each
member's contribution being determined in ac-
cordance with the possibilities in his particular
line of trade and his individual interest in its de-
velopment. In special departments these mat-
ters will naturally be dealt with by the advisory
trade committees. All costs of operation will be
covered by commissions charged on actual busi-
ness done."
The plan of the National Association of Manu-
facturers in forming export corporations will be
accepted as one of the first and most direct re-
sults of the Webb-Pomerene law, and having
been developed by experts forms an interesting
basis upon which to consider export trade de-
velopment in any given line of business.
As has been said before, the export corpora-
tion idea, either in its entirety or in part, should
prove distinctly interesting to the piano manu-
facturers just at this time, when so much atten-
tion is directed to the exporting of American mu-
sical instruments, or at least to the opportunities
that exist at present for placing those instru-
ments in a dominant position in foreign fields.
It is to be hoped that at the convention some
definite plan may be evolved whereby the ques-
tion of association help in handling export busi-
ness for piano manufacturers will be solved. The
question has been raised that not all manufac-
turers are directly interested in export business,
and some might demur at contributing to a spe-
cial association budget designed to support and
maintain an export department in the association
or as a part of the Chamber of Commerce activ-
ities. Those who have had experience in the
planning or forming of groups of exporters un-
der the Webb-Pomerene law are frank in their
opinions that much valuable time can be wasted
in seeking to secure the endorsement of a plan
by every association member. The suggested
method is to put the question before every mem- •
ber, and when a sufficient number, whether only
a dozen or more, have signified their interest and
willingness to support some group organization
for the development of export trade, then go
ahead and form such an organization. When
once formed it will be simple to enlarge the
scope to take in such members of the industry
as may later on prove interested. In other
words, the charter members of the group may
go ahead and enjoy the advantages of their pro-
gressiveness while waiting for the other mem-
bers of the trade to make up their minds.
The whole thought back of any group of ex-
porters in or outside of the association folds,
however, is that of co-operation along broad
lines, with definite service rendered to both ex-
port buyers and group members at a minimum
expense to the individuals among the latter, and
co-operation in some form or another will prove
the solution of successful exporting in the piano
as well as in other trades. It insures effective-
ness of operation at a minimum of expense and
enables exporters to meet successfully for that
reason such competition as may develop.
The National Association of Manufacturers
has just issued a most interesting booklet on
export trade development, written by R. M.
Fullerton, as well as a second booklet on "An
Export Order and Allied Topics," prepared by
another of the association's experts. Both book-
lets are of exceptional interest to those en-
gaged in or about to engage in foreign trade.