• TRANSPORT TIPS FOR TRADESMEN.
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Particularly Addressed to Those Who are Replacing Horsed Vehicles by Motors, or Contemplating So Doing.
-TIIERE is a very general tendency among traders nowadays to hold up their intended orders for commercial motor vehicles in the hopes of being able to purchase at somewhat lower prices in the fairly near future. The wisdom of this policy is questionable in Some instances, though the necessity for it in others is beyond dispute, Is it wise to wait'?
There are, of course, plenty of traders whose businesses have been so far affected by the slump as to make them very reluctant, or quite unable, to incur considerable capital expenditure at the moment. In any such case there is, of course, little or nothing to be said, except, perhaps, that reluctance to incur expenditure is sometimes due to a mistaken confusion between wise economy and unwise parsimony. If the trader has decided that he wishes to purchase motor vehicles, he has reached this decision, not out of any feelings of extravagance, but because he believes it would be good for his business were he to do so. It would, perhaps, give him an advantage over competitors offering inferior service to their clients. In this sense, it would act as an advertisement to his business and tend to increase the value' of its goodwill. The present slump will not last for ever, and those who will first emerge from it will, other things being equal, be those who have obtained a• reputation for good service. One often hears it said with reason that it is more important to advertise when trade is bad than when trade is good, and we may, perhsips, regard the purchase and use of a trade motor vehicle as a form of advertisement. From this standpoint, to delay purchase is tantamount to postponing the time at which we Shall begin to advertise, and, if a little money is saved by the delay, we have, on the other hand, lost the value of the advertisement for a certain number of weeks or months.
The Motor Vehicle Will Represent Direct Economy.
Another way of looking at the matter is that the purehase is contemplated because it is anticipated that the motor vehicle will represent a direct economy or, in other words, a saving in the cost of effecting deliveries. If the estimated saving is anything worth mentioning, it seems unlikely that it will be worth while to sacrifice-it in return for al problematical sa,ving in the cost of the vehicle at a later date. The latter may or may not materialize. We. must remember that there are no really sound reasons for expecting the cost of constructing a motor vehicle to go down appreciably during the next few months. A reduction in price must either be due to a reduction in manufacturing costs, resulting from reduced costs -of labour and material, or else to the fact that themanufacturer is overloaded with stock and is bound to dispose of it, even though its disposal represents little or no profit or possibly an actual loss. Reductions in price merely representing reductions in profit cannot be very considerable. Those. which represent the sale of goods at a positive loss are only likely to be made by manufacturers whose position is very critical.
Thus, if we purchase for, say, £700 a machine which cost the raanufacturer £800 to build, we must reckon on the possibility that that manufacturer will presently be out of business. In the event of his failure, the market value of his vehicles will be considerably reduced, partly because their reputation is naturally injured and partly, again, because the manufacturer, having shut down, is no longer avail
able to give any sort of service to the user or to 'produce the spare parts that the user may require from time to time.
Thus, the purchase of a, vehicle at something below cost price is not always a good. bargain, the price being, in fact, a reflection of the unstable position of the manufacturer. Of course, if he succeeds in pulling through,-the bargain may have been a good one for the purchaser. If he goes under, despite or because of a policy dictated by something like despair, the chances are that the remainder of his stock will be sold at even lower figures. At the
• moment, there is no sign of any appreciable decrease in the cost of labour in the motor industry. Moreover, a period of depression in trade tends to increase costs of production by reducing output. Consequently one does not see how a manufacturer who is _financially sound can be in a position to reduce his price much: for some time to come.
Actual Loss By Delay in Buying.
Further, the trader who is waiting for a fall may quite probably find that he has waited in vain and that hetiaultimately obliged to purchase before the fall has occurred. Meanwhile, he has been losing money by perpetuating a system which to his knowledge is not as economical as it should be. In short; if the motor vehicle is being bought. with a view to improved. economy of the delivery system, is it not probable that this economy will represe,nt, week by week, a sum considerably larger than any reasonable anticipated reduction in first cost?
Second-hand Vehicles.
In order to avoid disappointments to tradesmen who are considering •the delivery of their goods by motor vehicle, we .would warn those who are contemplating the purchase orsecondenand machines to be extremely ,careful in their selection of these.
The second-hand motor vehicle market contains many bargeins, but theme. iS always. the unscrupulous, dealer desirous of foisting worn-out and unsuitable vehicles on unsuspecting and non-technical customers. It is quite possible to " fake" an old vehicle so that externally it appears to be in good condition.
It is not always good policy for a tradesman to begin his carrying work with an old machine, as not. only will maintenance changes be considerable, but reliability and punctuality in deliveries, which. are assets of considerable value to the tradesman, may not be capable of achievementwith an old vehicle. It does not do te disappoint customers, particularly with such things as provisions ; if the family dinner is delayed by the breakdown of a vehicle, the tradesman owning this will most. certainly be held responsible and .a change of custom will probably ensue.
However, if the condition or the exchequer will not permit of the outlay necessary to purchase a new van, the tradesman should _obtain the assistance of either a trained engineer 'or a friend possessing technical knowledge to assist him in the purchase of a used machine. Great ease should be taken to set Mit the exact requirements for the work in hand, and not to accept a vehicle Which does not meet these, cenditions.
Do not consider the purchase of a converted private car, as these are usually quite unsuitable for commercial work. Also, de not purchase a vehicle which is unduly large for the weight of goods to be carried. It is far from economical to run a two ton machine with a one ton load.