Page:The Russian Review Volume 1.djvu/340

306 restricted proportions, the growth of which the manufacturer could not influence. Moreover, the advantage of the high prices in Russia was not obtained. The chief concern of the German firm was to give his Russian customer a wide choice of goods from all countries, and he had therefore no special reason to push the goods of any particular firm. Like his English colleague, the United States manufacturer was opposed to granting long credits.

The possible methods open to manufacturers proposing to share in Russian trade may be stated as follows:

(1)By correspondence. Business may be done in this way, but it can hardly be recommended as satisfactory. Correspondence would have to be in Russian or French, catalogues printed in Russian would be indispensable, and prices would have to be quoted in roubles c. i. f. Russian port or on railway car, i. e., including sea freight and duty.

(2)Through export houses. This plan of action is of interest only to the manufacturer who wishes to avoid the risks and trouble that a more profitable direct business would involve.

(3)By appointing Russian firms as agents. This is undoubtedly a much more satisfactory plan than the export house, because the prices to wholesalers will be lower and the volume of business will consequently be greater. Agents are of two classes:

(a)Those who work on a commission basis, some of whom are ready to undertake a full or partial guarantee of accounts for a corresponding additional commission.

(b)Merchants doing a wholesale business who take the financial risk and quote such prices as they think necessary.

There are many such agents in Russia. Before the war the majority of the more desirable already represented manufacturers and were not free. It is believed that now the difficulty of securing suitable representatives may be overcome, though many of the best agents, who were of German nationality, have left the country.

(4)Through a resident representative of grouped industries, correlated but not intercompetitive. While the initial expenditure for such a representative would be large, by being shared it would fall lightly on the individual firms interested. After the arrangements for agencies in the centers had been made and were in working order, a periodical supervision at longer or shorter intervals should suffice. There are two examples of this method in Russia that are working satisfactorily—one American and the other British. The former represents a combination of hardware and tool manufacturers, which included at the outset twenty firms and has since been increased to sixty-two. The organization is financed by a prominent New York banking house, through which all payments by the agents in Russia are made. A representative visits annually the fifteen centers at which the "combine" maintains its agents, who are mainly merchants buying on open account and not on commission. The British concern handles general machinery and maintains its own local representatives, who are