Classic Mode

Music Trade Review

Issue: 1921 Vol. 73 N. 24

Music Trade Review -- © mbsi.org, arcade-museum.com -- digitized with support from namm.org
THE MUSIC TRADE REVIEW
REVIEW
PUBLISHED BY EDWARD LYMAN BILL, Inc.
President and Treasurer, C. L. Bill, 373 Fourth Ave., New York; Vice-President,
J. B. Spillane, 373 Fourth Ave., New York; Second Vice-President, Raymond Bill, 373
Fourth Ave., New York; Secretary, Edward Lyman Bill, 373 Fourth Ave., New York;
Assistant Treasurer, Wm. A. Low.
J. B. SPILLANE, Editor
RAY BILL, B. B. WILSON, BRAID WHITE, Associate Editors
WILSON D. BUSH, Managing Editor
CARLETON CHACE, Business Manager
•
L. E. BOWERS, Circulation Manager
Executive and Reportorial Staff
tDWARD VAJJ HARUNGEN, V. D. WALSH, E. B. MUNCH, LEE ROBINSON C. R. TIGHE,
EDWABD LYMAN BILL, SCOTT KINGWILL, THOS. W. BKESNAHAN, A. J. NICKLIN.
WESTERN DIVISION:
BOSTON OFFICE:
Republic Bldg., 209 So. State St., Chicago.
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Telephone. Wabash 5242-5243.
Telephone, Main 6950.
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NEWS SERVICE IS SUPPLIED WEEKLY BY OUR CORRESPONDENTS
LOCATED IN THE LEADING CITIES THROUGHOUT AMERICA.
Published Every Saturday at 373 Fourth Avenue, New York
Entered as second-class matter September 10, 1892, at the post office at New York, Nl Y.,
under the Act of March 3, 1879.
SUBSCRIPTION
(including postage), United States and Mexico, $2.00 per year;
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ADVERTISEMENTS, $6.00 per inch, single column, per insertion. On quarterly or
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REMITTANCES, in other than currency forms, should be made payable to Edward
Lyman Bill, Inc.
Departments conducted by an expert wherein all ques
tions of a technical nature relating to the tuning,
regulating and repairing of pianos and player-pianos
p
are dealt with, will be found in another section of
this paper. We also publish a number of reliable technical works, information concerning
which will be cheerfully given upon request.
and
aUU
Exposition Honors Won by The Review
Grand Prix
Paris Exposition, 1900
Silver Medal... .Charleston Exposition, 1902
Diploma...- .Pan-American Exposition, 1901
Gold Medal
St. Louis Exposition, 1904
Gold Medal—Lewis-Clark Exposition, 1905
LONG DISTANCE
Vol. LXXIII
TELEPHONES—NUMBERS 5983—6983 MADISON
Connecting all Departments
Cable Address: "Elbill, New York"
NEW YORK, DECEMBER 10, 1921
The Music Trade Review extends its hearty greetings
to the entire industry, sincerely hoping that every
member thereof may experience in fullest measure
the genuine happiness of a most Merry Christmas.
SUMMING UP THE SITUATION
T
H E Review presents in this issue a comprehensive survey of
business conditions throughout the country, particularly as they
affect the music trade or are calculated to affect it during the
months to come. As a whole, the music merchants are an optimistic
lot and, judging from the reports have, in most instances, sound
reasons for optimism. In presenting this report to the industry,
The Review feels that it is doing a real service, as it is offering
both manufacturers and retailers something on which to base their
calculations for next year's business.
The various special articles also featured in this issue are from
men in and out of the industry who are in a position to speak with
authority on the subjects which they have chosen. Particularly
pertinent are the discussions of the value of good will and the
financing problem as it promises to develop. It will soon be time
for members of the industry to start on the development of next
year's campaign, and the more thorough knowledge they have of
conditions the more sure will be their movements.
THE QUESTION OF THE TARIFF
H E tax question now being out of the way, the next bidder for
the attention of the trade is the Fordney Tariff Bill. The
hearings on this measure began this week and are expected to con-
tinue for a fortnight, during which period the various important
questions involved will be threshed out thoroughly. The members
of the music industry are not alone interested in the amount of tariff
T
1921
protection granted the domestic manufacturers of musical instru-
ments and parts, but are also directly interested in the general
provisions of the measure and the possible effect of any over-
drastic tariff on the development of foreign trade as a whole.
The unusual world conditions that exist at the present time,
the disorganization in certain countries and the general depreciation
of foreign currency serve to complicate materially the problem of
framing a tariff measure that will act for the benefit of American
manufacturers and at the same time not cause harmful reaction.
In the framing of any measure affecting imports or exports there
must be considered the question of international trade, for it has
already been proven that no country can live within itself and prosper.
THE BUREAU OF INDUSTRIAL MUSIC
T
HOSE members of the trade who have been actively interested
in the advancement of music and in all the several channels that
have been followed to date should be extremely interested in the
announcement of the organization of the Bureau of Industrial Music
by the Chamber of Commerce of Los Angeles, Cal., under the
direction of Miss Antoinette R. Sabel.
Despite the title, the new Bureau is not a strictly business propo-
sition, but is designed to act as a clearing house for the musical
activities of that city, to help in the organization of choruses, bands
and orchestras among the employes of the various local industries,
for the purpose of realizing the benefits that such organizations
represent in business.
A particularly commendable feature of the work will be that
of making it possible for individuals of genuine musical ability to real-
ize upon their talents rather than to let their gifts remain unheralded
while they are engaged in earning livelihoods in ordinary fields of
endeavor. Los Angeles has done a number of fine things for music,
but nothing finer than the organization of this new Bureau of
Industrial Music. It marks a distinct forward step in the work of
putting music in its proper place and keeping it there.
SQ.
No. 24
DECEMBER 10,
REDUCED FREIGHT RATES PROMISED
T
H E announcement from Washington to the effect that there
is a likelihood of a general reduction in freight rates, under
orders from the Interstate Commerce Commission, is of particular
interest to business men generally, for although heavy freight rates
are not entirely responsible for the high level of commodity prices,
there is no question but that they add materially to the cost of
goods set down at the dealer's store and complicate the problem
of getting retail prices down to a normal level.
It is pointed out that, with the elimination of the excise tax
on musical instruments and a disposition on the part of retailers
of pianos to accept a normal profit and make their money on large
turnover rather than upon individual sales, there lies a real op-
portunity for the development of substantial business during the
coming year. There are many factors, however, that serve to main-
tain the high price level and which are out of the control of the
dealer himself. It all serves to prove the contention that the work
of readjustment is not a one-man job.
ONE MERCHANT SEES THE LIGHT
H
ONEST confession, it is declared, is good for the soul and the
following letter sent to The Review recently from a Southern
dealer should, on that theory, prove most beneficial, not only to
himself, but to other retailers who have been drifting along and
getting into bad habits. The letter reads:
"Dealers in this territory have sweated blood and have suffered
privation, persecution and profitless work and worry. Now come
repossessions, repentance and more work and worry, but thank God
we have all learned a lesson—at least your humble servant has.
"No more long-drawn-out lease accounts for me; no more pur-
chasing heavily in anticipation of a wonderful business. It shall
be good old reliable goods-for-your-money or short-time paper. I
shall court business from those who are able to purchase, who
demand quality and can pay for it.
"I shall not cut out the instalment business entirely, but a very
brave effort shall be made to secure this time business from those
who can assure me of their ability to live up to their contract. I
feel that your paper will help me to live up to my present resolve.
Hence the check for the renewal of my subscription."
Music Trade Review -- © mbsi.org, arcade-museum.com -- digitized with support from namm.org
DECEMBER 10,
1921
THE MUSIC TRADE
REVIEW
THE FINANCIAL SITU A TION AND ITS
PROSPECTS FOR THE COMING YEAR
gas
I
An Interview With Joseph A. Bower, Vice-president of the New York Trust Co,, in
Which He Advises Against Long Term Paper in the Piano Trade
Jlli
It is generally recognized that one of the domi-
nating problems of the music industry during
the coming year will be that of financing busi-
ness; in other words, the handling of credits.
Although in the past many suggestions from
bankers have been ignored, probably due to the
exigencies of the business, it is nevertheless im-
portant to present the banker's side of the ques-
tion as it affects the present-day situation and
conditions as they promise to develop. The fol-
lowing interview with Jos'eph A. Bower, vice-
president of the New York Trust Co., is there-
fore most timely, for Mr. Bower is not only a
recognized authority on banking matters, but in
addition has direct knowledge of piano trade
conditions.
It has been noted that banking paper rose
from a point where it was ignored almost en-
tirely by bankers to a position where it received
consideration almost equal to that of paper in
other lines, due to the curtailing of credit terms
during the period of the war. The tendency to
go back to long credit has naturally had an effect
upon bankers, and in this connection Mr. Bower's
comments are particularly pertinent.
"The main trouble with piano trade credits,"
declared Mr. Bower in an interview with The
Review, "is that the retail credit terms are too
long. This is not only unnecessary, but serves
t o r e a c t directly against the business, for it leads
the buying public to the belief that pianos may
be bought easily and cheaply and that they will
not be forced to make regular payments and can
enjoy a valuable product at little or no expense,
all of which increases the collection costs, which
are very high now.
"On long-time credits the dealer has to reckon
particularly with the expense of collection, be-
cause that is his largest expense. It is recog-
nized that if piano terms generally could be
brought within reasonable limits it would me^an
a material saving in overhead expense and per-
mit of lower selling prices, which naturally would
mean a larger volume of turnover and propor-
tionately larger profits. It is my belief, based
upon experience, that all piano accounts should
be cleaned up within a year, that the first pay-
ment should amount to at least 25 per cent of
the cost of the instrument, and that the balance
should be divided into equal monthly payments
not exceeding ten or eleven. The automobile
dealers have demonstrated the fact that this
basis of payment may be established and main-
tained on their products, which, in the main, call
for a greater outlay of cash than do pianos.
"The great trouble between the piano dealer
and the banker is that when the dealer seeks to
secure loans with his instalment paper as col-
lateral he finds that paper not desirable for a
bank, for in the majority of cases he has actually
asked the bank to make an investment rather
than a loan. The function of the bank is to have
its assets in such condition that it can meet the
demands of its customers for current loans and
have a sufficient amount on hand to meet the
peak of demand at certain times during the year.
The ordinary piano paper cannot be considered
by the bank for the reason that it is not liquid
and serves to tie up the bank's money as an in-
vestment for a long term, frequently running
into several years.
"The trouble is not with the quality of piano
paper, but rather with the length of the terms.
I have been called upon on several occasions to
liquidate piano paper and have found that it
may be expected to pay out lOO per cent if the
collections are followed with a polite persistency.
Bankers generally have had this experience, but,
unfortunately, perhaps, for the trade, are not in
the collection business.
"I believe that a more liberal use of trade ac-
ceptances, whereby the dealers would make the
manufacturers that form of payment, would
greatly help the industry and put it on a sounder
credit basis, provided the trade acceptances were
not given in any other manner or for any other
reason than that for which they are supposed to
be given. By that I mean they should not be
given for past due accounts, renewals accepted,
etc., but simply in payment of the original in-
voice on terms to be agreed upon."
Regarding the general national business situa-
tion, Mr. Bower held to the opinion that the
present work of liquidation on the part of the
banks was calculated to benefit business mate-
rially. He said:
"Money is not going to be very cheap for any
length of time, but is likely to find a higher level
shortly. There is no occasion to be overoptimistic
regarding great business developments during
the coming year, but it is certain that industry
generally is getting back on its feet slowly but
surely, and the gradual liquidation "being carried
on is calculated to put business on a sound basis
and open the way for healthy expansion. The
progress of liquidation is evidenced in the ten-
dency of commodity prices to rise again to a
sound level, although I do not expect the in-
crease will amount to more than 10 or 25 per
cent. This is a natural reaction and is to be
considered healthy rather than otherwise."
Carl D. and Roberty L. Laverty are continu-
ing the business of the Laverty Music Co., at
Gadsen and Talladega, which was founded in
1888 by their father, John S. Laverty, who died
recently.
THE OUTLOOK FOR THE COMING YEAR
{Continued from page 3)
to note that, though having been weaned by necessity from the credit evils of pre-war days, many retailers
have forgotten their lesson and have again permitted themselves to be entangled in the meshes of long
instalment contracts.
Although money is easier, bankers are apparently not in the frame of mind to make long-time in-
vestments in piano paper, and for them to make loans with the average piano instalment paper as col-
lateral means that they are becoming partners with piano merchants for several years at least. A promi-
nent banker stated recently that piano paper was good paper and paid out IOO per cent in the final analysis.
The trouble is that it takes too long to pay out.
Taking all the various factors into consideration, it is not expected that there will be any great
volume of business for the first few months of next year, although it is the general opinion that the busi-
ness totals will measure up considerably better than those for the first six months of 1921. If, as is ex-
pected, the general movement of liquidation and readjustment is completed by the Summer, then the music
industry will come into its own in the Fall and get back to a normal, healthy business basis calculated to
continue indefinitely.
A normal business basis does not mean the inflated demands that were enjoyed during the war
period and immediately thereafter. It means an average of business that will keep the wheels of industry
turning steadily and keep the goods moving through the retail channels and into the homes at a rate that
means turnover and profits.
Last year we offered as a slogan for the coming twelve months: "Work hard, move fast and watch
your step." It seems that the same slogan stands good for 1922.

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