290 REPORT ON COOPERATION IN AMERICAN EXPORT TRADE.

Jrotection to the selling house, else outside capital will not consider the invest.
ment. I believe that such selling organizations with contracts and selling
nethods legally recognized can be made highly profitable and afford the average
American manufacturer the best opportunity that can be offered for marketing
his goods abroad in a manner that will insure the permanency of his business.
Such organizations will permit of the payment to the manufacturer for his
goods within a reasonable time after shipment, so that he assumes no credit
burden or selling expense, and his one problem is that of manufacturing at the
lowest possible cost.
It must be realized that we have to meet the keenest competition, and the most
affdetive selling combinations in the world in our export work, and to meet this
situation every reasonable facility and advantage should be given us.
Frankly, we need a free hand within the limits of fairness, and knowing at
rll times that we are under the supervision or control of this Commission
against any unfair methods.

We have found that the representation of a number of manufacturers has
reduced the cost of selling and distribution of merchandise. We have alse
found that our method of establishing branch houses had made it possible to
rollect more promptly, and to reduce credit losses. It is, in my judgment, the
ideal way to extend our commerce and to meet foreign combinations and competition,
 and I would therefore respectfully suggest as a basis for the organization
 of such selling companies and the sale of their capital stock that the following
 privileges or rights be given:
The right to make exclusive contracts with manufacturers covering the execlusive
 sale of certain products in defined territory. These contracts should be
recognized in this country as well as abroad, as it is unfair to the foreign selling
merchant, who has Invested in stocks of goods and spent substantial sums in
creating business, to have such business taken by a domestic merchant handling
the same goods and who has not invested any capital or expense for foreign
trade.
Foreign selling organizations should be allowed to represent competing concerns
 if it is found to be mutually desirable. Such an arrangement may frequently
 give more than one manufacturer an opportunity of marketing his goods
abroad in a satisfactory way, and it will help to prevent the destructive effects
vf expensive and price-cutting competition.
The company which I represent has been obliged to cancel two 25-year contracts
 with important concerns which were competitors, and whose attorneys
advised them that the Sherman law and more recent legislation made their
position dangerous under the contracts which we held. Our arrangement with
these companies was entirely satisfactory to them and profitable to us. Neither
of them can market its products abroad as satisfactorily nor profitably as we
can. As a matter of fact, of the 30 or 40 manufacturers whom we represent,
[ doubt if a single one can sell its goods in our territory as effectively or as
profitably as is being done through our company, and these concerns have capital
ranging from $25,000 to $8,000,000 or $10,000,000.
The advantages of selling in one lot the various specialized products
 of different furniture manufacturers are instanced by F. B.
Smith, president of the Wolverine Manufacturing Co., furniture
manufacturers, Detroit, Mich., in support of export combinations.
He stated:
First of all, I would like to make the statement that the furniture industry
is classified under specialties. One manufacturer makes one branch of the
Jsroduct. For instance, our particular industry is parlor and library tables.
Another man makes bedroom furniture. Another man makes refrigerators, and
another man makes chairs.
In order to successfully reach the foreign manufacturer, or the foreign
market, some plan must be definitely devised whereby we can go to him with a
household product and sell him complete lines; and that involves the use of a
considerable amount of capital.
I do not believe that the furniture manufacturer in this country will ever
develop much of his foreign business until we have an organization with a
sufficient amount of capital and a sufficlent variety of product so as to be able
to supply the foreign manufacturer and carry that foreign manufacturer; I