Perth Amboy evening news., 1923-02-17
THE I~NDUSTRIALIST SAYS

banded its plant when orderS were
plentiful and the business outlook
rosy. The toll of fixed charges from
idle semi-idle plants is so heavy that
It pays to give serious consideration
to the nature and likely permanent
character of IN increase in demand
before yielding to the promptings OF
the sales department, even If this
means turning down occasional bust
ness that Is offered.
The deception character of an i'm
mediate demand, and the manner
in which this apparently multiplies
itself, have been well described by
a manufacturer of agricultural i'm
plements:
Every manufacturer that we
know of in the farm machinery bust
ness was told by his sales depart
ment that they were losing immense
quantities of orders in 1920 and that
increased provision must be made
for 1921 to take care of the busi-
ness that up until November appear
ed to be in sight for the year 1921.
I'VE think we are safe in saying
that if n one of the larger COM
panies could have accepted all the
business that was offered to 1t in
lJGU LIE HOOlu dafS n %oAN
Of the entire shortage of goods that
was at that time. In other
words, If a dealer wanted so plows
and could not get them in time from
his regular source of supply he
would try a half dozen or more man
ufacturers in an endeavor to get that
one lot of plows. If six ma~nufactur-
ers would feel they had lost the sale
of so plows. Had they all recorded
their shortages and added them to-
gether they would have shown a
shortage of six times so plows, or
800 plows, whereas the actual short
age was only so plows. If all COM
panies should have expanded their
production capacity to take care OF
the amount of business that they
thought they had lost it Is plainly
apparent that there would be provid-
ed the aggregate increased capacity
for six times as many machines we
were really short, resulting in over
expansion of production and conse-
quent absorption of working capt.
tai"
But, working capital is just as I'M
proitably absorbed where stocks OF
raw and unfinished material are out
of balance with sales and production
requirements or market and pur-
chasing conditions, and grave losses
may even be experienced from ab-
solescent material where the product
The dissipation OF capital from the
slow movement Of work in progress
day in the process of manufacture is
;s perhaps not SO generally per-
ceived and recognized, yet every dol
lar of capital tied up an unnecessary
day in the process of manufacture is
unprofitably employed. Unbalanced
production, damned departments,
shortages of desired parts or mater
ial, poorly conceived scheduling OF
jobs, or no scheduling at all, take on
a significance not commonly appre-
ciated, and in the avoidance OF such
often lies the secret of getting along
with the capital resources one pos
sesses. Suppose a job now taking IA
days to come through a factory
could, with a little system. be exc
cuted in seven. Do men realize how
that would work to release for other
uses capital now unavailable? Every
unnecessary delay in operation. IS an
additional strain on our financial re-
sources.
Some manufacturers and ever
entire industries, r accustomed to
making special prices for volume
orders and are forced into the stor-
ing of finished goods until delivery
is desired. WarehouSing service of
this sort costs money. The point to
remember is that the financial re-
turer are strictly limited and the
sources of any particular manufac-
are curtailed when the manufactur
uses to which such can be placed
er acts gratuitously as banker or
warehouseman.
These are. just some Of the few
problems the manufacturer OF today
has to face.
l wonder If the average working
maj realizes how these problems
worry the executive whom he con-
siders has a soft Job"
When men begin to think a little
beyond their pay envelope there will
be a different attitude and possibly
more production.