The Richmond Virginian. (Richmond, Va.) 1910-1920, 1913-03-03

secretly acquired contTol OF -. M Us
borne & Co, OF Auburn, y. Y, its
chief competitor. This secret con-
troll was maintained for nearly two
years, during which the Osborne COM
pany was operated and advertised as
an independent concern Two OF
the chief stockholders of the Osborne
company agreed to refrain from en-
gaging independently in the same
lines of business for a period OF ten
years. Again. the combination, be-
tween 1908 and 1904, acquired and
secretly operated several other COM
peting harvesting machine concer~~r
namely. the Minnie Harvester COM
pany. the Aultfnan- Miller company
and the Keystone company In some
cases it was contended that the con-
cealment Of ownership was employed
to facilitate liquidation Of certain
accounts of the purchased concerns
Negotiations for the acquisition of
several other harvesting machine con-
Germs were not consummateds IN some
cases the initiative came from the
competitors.
Extensions Into New Lines.
The company's acquisition of COM
petitors In harvesting machines was
followed by extension of it's manu-
facture into numerous new lines.
partly by the purchase Of established
concerns. Among the most important
Of such lines were tillase implements,
manure spreaders, farm wagons, gaso-
line engines, tractors and cream
separators. The extension Of the COM
pany into these lines was directly fur
thered by its substantially monopolis-
tic control of the harvesting machine
business. 1t is obvious that the pos
session of a monopolstic position in
Ery 4pVN,A gg-Sr T.. r. As1 hrsr
ness afforded a powerful lever for
forcing the sale of its new lines.
Competitive Methods.
The competitive methods employed
by the company have been the SUBJ
jet of much complaint Some of
these complaints relate TO practices
which, like the use of the exclusive
clause in agency contracts and the
ope ration CT purchased COMPANIES as
Independent, were at one tire extern
siveIy practiced. but whJln have since
been abandoned. AS above noted,
some Of these acquired concerns were
openly advertised as Independent.
Among the most important COM
plants charged against the company
in recent years Is an effort to secure
an undue proportion OF local dealers
in farm machinery by allotting. as
rule, only a single branl u any one
dealer in the same place, thus tend
ing to restrict the outlet for COM
petitors' goods. The companys own
records show that this was one pur-
pose at least In making this distribu
ton of its brands and It appears TO
have had some practical effect in
handicapning conspeLitioa-
Compulsion of dealers to take the
company's new lines by reason Of
it's monopolistic control Of harvesting
machines ("full-line forcing'D has
been attempted with more or less sue
cess by the company's representatives.
Attempts to secure the exclusive
I handling of certain tines Of the COM
/ pany by similar methods were also
| reported to the bureau.
| Special discriminatory prices and
/ terms have been reported in a num-
/ Der OF instances, but the general
/ policy Of the company Is to maintain
high prices in the monopoljzed lines;
I in the principal new lines, however,
/ where considerable competition is en-
countered. unusually low prices and
/ long terms have been generally en-
ployed
Another rather general complaint
is that statesmen of the International
Harvester company represent that
purchasers Of competing lines of har
vesting machines will be unable to
secure repair parts. a matter of much
practical Importance. officers of the
International Harvester company ad-
init that this was at one time a COM
mon characteristic of competition in
the harvesting machine industry, but
that the company is opposed TO the
practice and has used active efforts to
eliminate it. The bureau, however
received rather numerous complaints
of this character.
The company at one time openly
attempted through a clause in Its
commission contracts, to control the
price paid for its machines by the
farmer to the retail dealer. Since the
elimination of this clause, "sug-
gested' retail price lists have been
/ rather generally circulated by some
OF its branch Offices apparently for
the purpose of indirectly maintaining
the retail price, although the COM
pany contends that these lists are in
tended for the use OF its employees in
furnishing information to purchasers
and processes to discourage their is
suance to dealers 1t Is evident, how
ever, that it could completely stop
this practice If 1t really wished to,
Superior Resources
The companys exceptional financial
resources. including its connections
Z with j. +. morgan ana Jonn u.
Rockefeller. constitute bne of the
chief sources OF its power. They not
only enable ii to secure the economies
Of large scale operations, which, as a
rule, give it marked advantages in
manufacturing costs, but also enable
ii to maintain a very elaborate selling
organization, by virtue of the variety
and extent of it's business. Further
more, they give it great advantage
in extending credits to purchasers, an
exceedingly important feature Of the
farm machinery industry. While APP
parently any such use of credits has
not been controlling factor in re-
stricting competition. it appears to
have been felt To some extent in GER
tain lines. and is one of the chief
sources of complaint from fnanufac-
turers as distinct from dealers in farm
machinery.
Present Position.
AS a result OF the developments and
practices above described, the posi-
ton of the combination has changed
from that of a maker of harvesting
machines only. until it is now an i'm
portant factor in several other
branches of the farm machinery bust
ness, In manure spreaders 1t appears
to have over one-half of the business,
and in disk harrows approximately 40
per cent; and it is increasing its pro-
portion in several other new lines,