Music Trade Review

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Here Is How
The Carrying Charge
N the majority of the more prominent Mil-
waukee music houses feeling on tin carry-
ing charge is extremely favorable, although
in one or two instances it is reported that there
are some objections to its operation.
At the Edmund Gram, Inc., music house,
Edmund Gram stated that the company feels
that the carrying charge is merely in the proc-
ess of development and that with the study
and experiment now going on in that direc-
tion he feels that some improvement is coming
forth in the carrying charge which will make
it more successful of operation.
The Flanner-Hafsoos Music House, Inc., be-
lieves in the carrying charge as it is generally
operated in Milwaukee with a charge of one-
half of one per cent of the balance for the
accommodation of the delayed payments, ac-
cording to Florian F. Flanner, but the company
has not used it because it has not felt that con-
ditions have allowed a change to this method
of operating divided payments.
"We have been keeping to the straight in-
terest charge, for, although we believe in the
carrying charge, we do not believe that at the
present time it is possible to sell a piano at
the right price, and get a carrying charge on
it," said Mr. Flanner. "We have been charging
('• per cent interest right through, and we find
that it takes care of our needs and is easy to
present to the customer.
"In many instances in the present situation
when selling is somewhat hard, the price of the
piano is lowered so that the customer will-buy
it ard agree to the carrying charge. We be-
liew. that it is more important to keep the
price, of the piano right, rather than to slash
the price and then tack on a carrying charge.
"lhere is no doubt that the carrying charge,
well practiced, has great advantages," Mr. Flan-
ner continued, "but with the amount of con-
fidence lacking in business to-day we have felt
that a greater stability of conditions is needed
before we operate with it. People are accus-
tomed to and thoroughly understand and ex-
pect the interest charge, while they are lacking
on information on the carrying charge, and
consequently are somewhat inclined to be sus-
picious of it.
"Our accommodation charge is the 6 per cent
interest due us on the balance after the initial
or down payment has been made. We have a
regular contract on which this rate of interest
is printed, and which in addition to the note for
the money provides for a chattel mortgage on
the instrument, and we find that customers
readily understand this contract, and are well
satisfied with it," Mr. Flanner concluded.
I
Is Working Out
The J. B. Bradford Piano Co.
has used the carrying charge
with good success, according to
Hugh M. Holmes, vice-president
and sales manager of the com-
pany.
"It is a sound business prop-
osition and we cannot trace a
single sale which was lost be-
cause of the carrying charge,"
Mr. Holmes said. "We are well
satisfied with the success of its
operation, and we have been en-
forcing it regularly in our de-
layed payment sales.
"Our selling force is well instructed on the
carrying charge, and we operate it according
to the general plan, charging one-half of one
per cent on the balance due. The great ad-
vantage of the carrying charge over the regu-
lar interest charge's lies, to my mind, in the
fact that paying only the regular interest charge
the customer is in no great hurry to get through
with his payments before the appointed time,
but with the carrying charge he sees that it is
to his great advantage to clean up the account
as soon as he can possibly do so, and this
brings in money more quickly.
"We sell the piano on the cash price, adding
the cost of carrying an instalment sale, rather
than asking a fictitious price in the first place
and including the carrying charge, giving a
discount in case of a cash sale."
At the Luebtow Music Co. it was stated that
the carrying charge is one-half of one per cent
per month on the balance between the down
payment and the cost of the instrument. The
great advantage of the carrying charge over
the interest charge, it was stated, is that if a
person is under a carrying charge contract he
soon realizes that he is paying 10 to 12 per
cent interest, and he will come in and want to
settle up.
The only difficulty experienced with the
carrying charge is that of selling business men
on it, it was stated. They point that when a
firm gets 6 per cent interest it gets this money
not only on its original investment and operat-
ing cost, but also on its profits, and for this
reason they disapprove of the carrying charge.
Henry M". Steussy, vice-president and general
manager of the Kesselman-O'Driscoll Co., says
"There is no question of the success of the
in
Los Angeles
and Boston
carrying charge, and if I had to be in business
without it I'd quit business. The carrying charge
can be sold to the public beyond any reason-
able question of doubt, and in a successful
and satisfactory manner if the customer is
thoroughly posted and informed of its existence t
at the time he purchases the instrument."
At the Kesselman-O'Driscoll company store ,
the carrying charge is used on all merchandise
sold on the time basis, and is figured by divid-
ing the balance due between the down payment
and the purchase price by .02 per cent.
Boston
' T H E music houses of Boston are divided in
•*• their opinions regarding the carrying charge
method of handling time payments, but several
of those who have adopted that plan are en-
thusiastic regarding it.
Ernest A. Kressey, of the C. C. Harvey Co.,
for instance, has this to say regarding the car-
lying charge method:
"At the beginning of the application of a
carrying charge to our accounts about a year
ago it was found to be practical. While at
that time there were a few purchases which
had experienced this form of procedure, there
was necessarily more explanatory work to do,
but later there were various companies adopting
the policy, and, now that it has become quite
general, it has relieved practically all of this
explanatory work and is largely accepted by the
buying public.
"It is advantageous in not only bringing a
fair compensation for carrying the lease, but
has an automatic tendency to larger down pay-
ments and monthly terms, and especially so
{Continued on page 6)
NEWARK N. J.
ESTABLISHED 1862
ONE OF AMERICA'S FINE PIANOS
UPRIGHTS
GRANDS
THE LAUTER-HUMANA