BUTTER BARGAINS.

Dominion, Volume 2, Issue 333, 21 October 1908, Page 3

BUTTER BARGAINS.

SELLINC VERSUS CONSIGNING. (To the Editor.) Sir, —I shall be glad if you can favour me with space for a few lines of gratuitous advice to thoso many dairy factory directors who are, favoured .by living in. the glorious districts of Taranaki and Wellington. From careful 1 observations I have discovered that a few disinterested words will not be amiss in the present-,'situation in this district. The conclusion I have come to is that it will most decidedly be advantageous to the factoriesto favour selling forward. When I advocate soiling 1 must not be misunderstood. This is aii exceptional selling season, and it will be little less than utter folly for any Board of Directors to. pursuo a consigning policy when 'opportunities are given to them by unforeseen circumstances to sell at a price which is a really excellent return, apart altogether from any alleged better result through consigning. Now it is urged to dairy factories that ti secure the maximum benefit it is necessary to pursue a consigning policy continuously, and that they should be impervious 'to 'temptation to sell their outputs any particular season. Now, this advice is utterly fallacious. This 'line of argument is evidently based on the false assumption that dairy factory directors possess absolutely no business capabilities whatever, or at least very few. The | exponents of the continuous consigning policy tail to credit the directors with ordinary business acumen and intelligence. They state, 'with .the blind confidence of the gambler, that if he keops his stake on a certain nrfmber that number is sure to turn up eventually. .This is the advice -which is given to directors: Is it not preferable for these gentlemen "to judge the actual position for themselves, and follow yearly a course which is decided upon yearly with the sure confidence of the skilful business man? They surely 'have, the aptitude and capability of discerning how they will best benefit their respective companies. Is not. the honour ,of their directorship sufficient guarantee to them o"f their commercial superiority over their shareholders? Therefore, I say they must maintain that honour by having original : thoughts and actions, and justifying thereby , the , confidence of their shareholders. They know, surely, _ when it is preferable to &ll'and when it is preferable to consign. Their - ordinary business knowledge and experience will tell them that they should sell forward on a high market and consign on a low.. .Tlius,. if 9}d- to lOd. per lb. f.o.b. is offered for sale,'they can fairly accurately judge that a consigning policy can safely be followed; but if 11a. to ll£d. is offered',-their, .inherent, commercial , instincts ! should' warn them that they should sell. If IOJd. is offered,, .then- sell half and consign half. The maxim.is to these directors: "Use your individual intelligences in the best interests of your companies, and •be not too willing to assent'-to the suggestions of perhaps one or two.jnasterfully inclined persons, whose opinions are. narrowed by their reluctance to risk- a.:flexible policy." They must not let the resolutions of .their predecessors gag the free expression of their wishes. They must not become .intoxicated with the results of. a successful year, and allow their perceptive powers'-to be blinded.. Last was an exceptional consigning year, a yeaf in which a record was established for high prices,, but this result was due, of course, to nature, and 'it must not ; be forgotten that nature,'like-the Goddess of Fortune, is fickle indeed. It must not be;laid down as. a truth that, because universal ;!droughts benefited .colonial producers one year, those droughts will take place again this coming season.,—l am, etc., ■ • JOHN MACKAY. - -Stratford, October. 15, ■