Mr. Winser to Mr. Seward.
Sonneberg, September 19, 1877. (Received October 11.)
Sir: Pursuing the line of inquiry suggested in the separate Department dispatch, issued in August last, concerning the best methods of judiciously fostering the trade of this country with the United States, I have to add to the communications which I have already had the honor to submit on this subject in my dispatches Nos. 235 and 236, the following information, which I have obtained from unquestionable authority, on the matter of introducing American manufactures to Germany and to Europe generally.
My informant has had large experience in the direction mentioned, and he fully indorses the opinion which I have gleaned from various other sources as to the existing prejudice against American goods simply because they are American—a prejudice which has no sort of connection with the merits of the commodities themselves, but which is simply based upon the jealous feeling which our high protective tariff has developed.
In spite, however, of this bias against our merchandise, my informant believes that the cheapness and excellence of many kinds of American wares would secure for them a good market in Europe, if only a more prudent and sagacious course were followed by our manufacturers. He [Page 72] is confident from his own experience that the tendency of our business, men is to push their goods too strongly at the outset, and so overstock the markets. Instead of being content with moderate and progressive sales, they commit this error, which is certain to result in a fluctuating rather than in a stable and satisfactory trade.
Several instances of this unwise policy were given, the business in nickel goods, for example. There are a large number of articles made of this metal which are neat and useful and low-priced, and, in fine, well adapted to hold the European markets. Among this sort of goods, mountings for harness, whips, and walking-sticks, and frames for pocket-books and traveling-bags were mentioned. At one time the trade in these articles was quite satisfactory, and it gave every promise of being permanent. But the American manufacturers were not satisfied with doing a moderate and gradually-increasing business. They sent commercial travelers to Europe who sold this sort of goods to small dealers at wholesale rates. The consequence of this eager pushing soon made itself felt. There was one year of enormous sales, and then the business was utterly spoiled by an overstocked market. The same lack of wisdom, it is said, has characterized the manufacturers of jewelry. In this branch of industry a large trade was at one time done, especially in the cheaper varieties of imitation jet, enamel, and gold, comprising bracelets, brooches, sleeve-buttons, medallions, pencil-cases, &c. The taste displayed in this kind of ware, its low price, and the novelty of many of the articles, all helped to recommend it. But the manufacturers were too eager to drive a large trade. They overstocked the market arid killed their business.
Another instance was given of the course which an American clock-maker pursued. My informant said that his house purchased clocks at the factory in Connecticut for $1.50 to $1.65 each, according to the finish and mounting. In the course of three months he sold in Germany, England, and other European countries no less than fifteen thousand of these clocks at prices which were perfectly satisfactory to seller and buyer. But at the end of that time he ascertained that the manufacturer, in his impetuous desire to make sales, had consigned large quantities of these clocks to England, where they were sold at an average price of six shillings each at retail; or something less, after the freight, charges, and commissions had been borne, than my informant’s firm had paid at the factory, at wholesale, for the 10,000 purchased in Connecticut. Of course, the method which this manufacturer has followed will eventually destroy what might have been a permanent trade.
Again, the manufacturers of fancy writing paper and envelopes, who get up their goods in excellent taste, would make large and profitable sales in Europe if they would show ordinary business shrewdness., I am told that a combination exists among themselves by which each manufacturer is bound to send all his surplus stock to a commission-house in New York. From this commission-house large sales are made, ostensibly for the home market, at much lower prices than those which known exporters are required to pay at the factories. As a consequence it is asserted that purchases are made at the New York house in an underhand way, and the goods so bought are shipped to Europe, where they are sold at rates with which open export purchasers cannot compete.
These are some of the errors which I am assured are committed by our manufacturers. I feel it to be my duty to mention them in connection with the demand which the Department has made upon me for information as to the best way of improving our trade with Germany.[Page 73]
These mistakes might be remedied, perhaps, if our manufacturers would place their goods in the hands of a competent agent in each large European city. In this way they might succeed in establishing a regular and profitable business, instead of rapidly oversupplying the markets and afterward laboring under the disadvantages of dull sales and an uncertain demand.
Having thus described what are said to be some of the obstacles at present existing in the way of a flourishing trade, I am very glad to close this dispatch with a word or two of a more agreeable nature. I am told that American mechanical toys would sell well in continental Europe if they were more finely finished, even though the cost were a little increased on that account. Of the ingenuity of these toys there is no question, but they fail to meet the esthetic demand for comeliness and perfection of shape. But, as it is, the American toys have materially affected the export of certain classes of playthings hence to the United States. They can, however, get a prompt and firm hold upon the markets of continental Europe if an improvement takes place in the point which I have indicated. Alphabet and picture blocks are no longer manufactured here for the American market, because those made at home are better. The only thing necessary to the satisfactory sale of this class of toys in Germany and other countries of continental Europe is, that the pictures, letters, and devices which appear upon the blocks shall conform to the tastes and requirements of each nation.
I am, &c.,