CASH-ORDER TRADING.

New Zealand Herald, Volume LXVI, Issue 20324, 3 August 1929, Page 11

CASH-ORDER TRADING.

INTERFERENCE RESENTED

COMMITTEE'S " EIGHT

DEFENCE OF THE SYSTEM

Cash-order traders arc resentful of the Suggestions concerning the control of the system made to the House of Ropresenta-' lives by a committee of inquiry on Thursday afternoon. It is contended that the system compares favourably .with other forms of credit, to which business now doqe by cash-order would bo driven were the latter suppressed. "A preliminary meeting of representatives of tho cash-order trading firms of the city was held this morning, and it is certain that we shall enter an emphatic protest against what wo consider to be un■wnrranted Government interference in business," said the representative of n city cash-order trading firm yesterday. Until the full text of the report of the committee of inquiry was available cashorder firms would not be in a position to make a complete reply, but it appeared that the committee's "eight points," which it asked the Government to consider, indicated that it did not favour cash-order trading. Clean Sheet by Comparison. Considering the first suggestion of the committee—that the charge to clients should not exceed 6d in tho £l—the trader said: "It is grossly unfair that the Government should be asked to limit our charges to customers while it is making no further effort to place a similar restriction on pawnbrokers and moneylenders and others extending credit. Such a proposal, if adopted, would reduce our charges from 10 per cent-; to 2£ per cent., and inevitably that would servo still further to popularise cash-order trading, which is as simple as it is unquestionably lawful, otherwise it would not have been' permitted to exist for over 30 years. Hire-; purchase firms are allowed to charge 10per cent, for terms, in addition to their normal profits. Comparison with other . credit systems. leaves cash-order trading with a fairly clean sheet."

"It must also be patent that suppression of cash-order trading would simply drive established custom from its .channels to those of other forms of credit," he added. In answer to others of the "eight points" of the committee of investigation he said all the Auckland cash-order firms did not canvass housewives. Business circulars. inviting inquiry but imposing no obligation were sent out, and upon request a traveller called .with 3 form of application for credit, which reqnired the name, address and signature of the applicant, together with the name of her husband and place of his employment. The reason why orders were issued by " travellers at the house of the applicant rather than from a registered office was that it enabled the firm's representative to establish the bona fides of the applicant as a householder and to fully explain the system to her—often in the' presence of her husband. In any case an assurance was required from the house \vife that her husband consented. No Orders Issued to Minors.

No ordeis were issued to persons under 21 years of age, and even in the case of single persons over 21 years, the consent of parents was first obtained. "These, precautions arc taken m our own interests and my firm has issued only one summons r* four years' trading," he stated. Cash order traders considered emphatically (hat they possessed the right to - select the firms which should negotiate their orders, for it was only by so doing that there could bfe.anv certainty that the customer was not being unfairly penalised because he or she was a cash order trader. That, too, appeared to answer the suggestion of the committee"' that cash order trading would result in an increase in the cost of living "Wo have had instances where, at a customer's special wish, we have author-' ised a firm outside our list to supply 1 goods on'our order, and the purchaser has been loaded-with an extra 10 per cent.," slated the representative of the system.£ "That is, of course, unfair. Wo bring bigger business to selected reputable firms at no cost to them and naturally they can afford to allow us .a discount without charging cash order customers anything extra Listed firms gain this extra business without expenditure ow advertising, canvassing or other means of attracting custom, and I fail to see where cash order trading can tend to increase the cost of living." The answer to the last of the committee's "eight points"—that no orSe»should be issued to any person who had not completed payment of a previous order—was obvious. Naturally a firm would not continue to give extended credit where a client was in arrears. Ho repeated that in four years his firm had issued onlv one summons.