COUPON TRADING BY NAPIER FIRMS

Manawatu Times, Volume LIV, Issue 6866, 22 March 1929, Page 7

COUPON TRADING BY NAPIER FIRMS

Time Payment System

COMBINE TO OPPOSE CASH ORDER FIRMS EXEMPTION ASKED TOR. Per Press Association. WELLINGTON, Last Night, The Minister of Industries and Commerce heard further evidence in Wellington this week respecting the cash order trading system. An officially supplied report states that two witnesses, both resident at Napier, said they were both managing concerns that had operated timo payment systems, known as coupon systems, for five years. This system enabled purchasers to pay at the rate of 2s 6d in £1 per week. Purchasers signed an agreement to pay and interest had been collected on overdue accounts. The coupon system was inaugurated for tho purpose of enabling wage earnors to purchase articles at moderaito prices. The buyers purchased at market prices and no extra cost was added to stocks by the system. The purchaser could not inako a second purchase until tho payments on the first had been completed. It was claimod goods could be sold cheaply, because thero was no thiru party. Cash customers had an advantage over coupon purchasers, in that they received 5 per cent discount and for prompt payment of monthly accounts 24 per cent, discount.

Apart from this system, theso two witneses had formed the Budget Corporation Ltd., including many of tho largest firms in all trades in Napier, for the purpose of keeping out the cash order trading companies. The corporation was open to all traders and no fee was charged then for membership. This had been operating since August, 1925. Traders returned 121 per cent, of tho amount of the cash orders issued by the corporation to that body and at the end of the year, it was proposed to givo one-third to the directors for their services and allocate the remainder to members pro rata, according to tho volume of business handled by them. Tho public was offered cash orders, repayable in 6evcn weeks free of interest, or for ten weeks at a charge ol 24 per cent. Members guaranteed to sell at marked prices. Increased business, and tho saving of overhead expenses, bad debts and book-keeping wero claimed.

Exemption from any general restrictions which the Commission might think fit to recommend was asked for this system.