CAUTIOUS OPTIMISM.

New Zealand Herald, Volume LXIV, Issue 19832, 30 December 1927, Page 10

CAUTIOUS OPTIMISM.

BUSINESS IN NEW YEAR,

TRADERS'. ANTICIPATIONS.

* DIFFICULT PERIOD PASSED

DEPENDENCE ON THE FARMER. Qualified optimism most nearly describes the spirit in which Auckland business men, emerging from one of the most difficult years in recent times, look to the future. On the farmers' capacity to pay depends the main hope of brighter business in the new year, and increased butter-fat production and better prices for wool encourage the belief that the corner has been turned.

"Bigger cheques for the farmer arc enabling him to catch up on arrears," said the director of one large concern with numerous country branches. "It has been our experience that the leeway caused by the dull times has not' yet been wholly made up, but by about February or March we anticipate the farmer -will have something and to spare. It is to that period, then, that we look for a very substantial improvement in turnover."

"Our bad debt losses have been no greater than in previous years, and payments have been made almost as regularly as usual," said the principal of a city drapery emporium, conducting its business on the basis of cash, with credit' to approved clients. "We have had to work harder for our returns, but our turnover has been slightly ahead of last year. It has been a particularly hard year in that the economic position has caused a marked curtailment of seasonable and social events. Since the visit of the Duke and Duchess of York at the beginning of the year, there has been a dearth of functions, with the exception of race meetings, likely to stimulate that class of custom."

Time-payment System. Opinions, vary on the business value of the time-payment system. It was stated on behalf of one firm conducting a substantial portion of its business 011 those lines that there was nothing in the year's experience to coiinoto necessity for any revision of this system. Greater care had been taken, however, in investigating the stability of possible "bad mai'Ks, and there 'had been a slight increase in the number of repossessions, notably in motor-cycles, and musical instruments.

in the endeavour to keep abreast of the previous year s sales returns, the field nad been moie intensely exploited, with the result "that, to secure an equivalent turnover, expenditure had been considerably increased, said the head of a linn ueaung direct with the public in a wide range of merchandise. That had been the sole. departuie lrom the normal in tho quest lor business. Exploitation methods, he considered, must be mainly on established lines, and' catch "stunts ' to bring trade seldom yielded in hard cash a return commensurate with the expenditure fat money, time and energy' necessarily involved. Expenditure 011 items in the luxury class has been rigorously avoided by the majority of (lie public. That spirit, .manifest throughout ilie greater portion of the year, was noticeably carried through the lestive season, and the bulk of Christinas purchases was done more strictly on the utilitarian basis than, has been the case for many years. Quiet Confidence Felt.

One section ot the commercial world, which, above most others, has felt the pinch of financial stress is the small retail business, depending largely on the offer of liberal credit for a trifling deposit. Gramophone dealers and vendors of musical instruments in a comparatively small way have found the year one of much difficulty. Against this experience, however, has to be set that of traders in a larger field, many of whom declare that, contrary to their expectations, timepayment purchases have declined without diminishing the total volume of business. The inference drawn is that a very considerable section of the people, recognising their incapacity to indulge their tastes in anything bordering on the luxury class, have, in honesty to themselves and the business community, refused to commit themselves to the purchase of nonessentials. preferring to buy strictly on the cash basis. The result, in many instances, has not been less business, hut sounder business. Firms catering exclusively for luxury items, however, have been hard hit by this changed trend. "We look with quiet confidence and perhaps with a slight degree of mild exultation to the new year's business," said one business man. And, varied with similar notes of caution, that point of view is generally expressive of the outlook of most Auckland traders.