Grant County herald. [volume] (Lancaster, Wis.) 1850-1968, 1878-10-17
This is the spirit Of the age and moth
ing can change or avert it.

ing can change or avert it.
But some of our readers will say.
what can We do our customers do
not pay us and so zoe cannot pay.
Then our answer is there il something
radically wrong in the way Your bus.
mess Is conducted. Either you have
capital insufficient for your. business.
or yon are carrying too large stock
OF goods, or you don't collect as
closely as you ought to. or you are
selling on too long time, And this
brings us 10 tho subject on which
We started but from which We have
wandered, which is this I: That no
merchant either ,oholesaler or retailer
can dford to sell goods on unusually
long time. erea chen he gets hiJh
rate Of intereon. 1t. Is very natural
when q customer offers to give you
his note at three, six or twelve months,
with interest at one per cent, month,
to think that that is very fair rate OF
interest, much more than money usu
ally brings, and that il will certainly
pay you TO take the note at such a
rate, when banks and capitalists are
glad to get good paper at seven or
eight per cent. So also some of our
customers seem to think. Most of
them, we are glad to say, in the cases
where we allow them extra time, re-
gard it as favor, and appreciate i,
accordingly, but some seem to think
that the accommodation is on the
other side, and that they have done
very handsome thing by us in paying
us ten per cent, when money can be
borrowed at eight per cent. We
have frequently been reminded by
such shat they have paid us great deal
in interest, and the inference suggested
that we ought to be very much obliged
for their doing SO, and not the remot-
est suspicion seemed to cross their
minds that we had been accommoda-
ting them-not they us. A good
business man does not need to consider
the subject more than ten minutes TO be
satisfied that while the banker or cap.
italist can afford to loan money ST ten
per cent, the merchant can not The
former does business without expense,
or with very slight expense. The
merchant has large expenses, and the
only possible chance for him TO make
any money is by turning his capital
over frcduently--not by investing IL in
six or twelve months notes. II re.
quires very little calculation to prove
that if merch ant has 100000 CAPT.
tai, and $4,000 year expenses, and
invests his capital at ten per cent. per
annum, it will be only seven or eight
years before he has q wide experience
but no capital. 1t is the nimble pen
ny that wins in merchandising. Stocks
(either retail or wholesale) ought to
be turned over from nine to twelve
times a year--that is, for every thous.
and dollars worth of stock carried,
there should be sold $4,000 to $4,000
of goods per year. The dealer who
carries stock of 1900 ought to sell
$4,000 to S25, 900 per year. Sup.
pose a merchant sells customer q
bill of 800 once month at profit
of ten per cent, and each bill is paid
promptly in thirty days. That 800
of capital has produced during the
year profit of 800. But suppose
that the bills were sold on six months
time at the same profit. Then each
500 of capital invested would have
produced but So of profit Now, in
this latter case, if the merchants ex-
penses per annum are 90 per cent. Of
his capital in business (and that is
about the usual ratio, then it has cost
him as much to sell the goods as he
gets profit, and he bas made absolute
ly nothing by the transaction. This
simple example shows the wide differ
ence between short and long credits,
and illustrates the fact that those who
sell on short credit for prompt pay
can afford to turn over their goods at
a smaller margin than those who give
long time, and it proves also that
merchant cannot afford to let any
considerable part of his capital be in
vested in long time notes, or accounts
at any reasonable or even any unrcas-
enable rate of interest. - Greedy,
Durham 6 Co.'S Grocer's Price Cur
rent.