Frequent use has been made of the word factor, and no adequate definition of its meaning has yet been given. The factor is, briefly, the commercial banker of the industry, and his duty is to provide, at any stage of the cotton process, the financial assistance which may be necessary, either from his own resources or through his affiliations with some large bank. It is true, of course, that some factors work only with those dealing in raw stock, and some confine their services to mills. Some factors are cotton buyers, some are selling agents, some deal with buyers and some deal with selling agents. Some are employed only by the mills. Recently, however, the tendency has been to develop under one roof a unit institution capable of handling every textile banking transaction. It will be interesting to enumerate here, briefly, the various functions and facilities of one such institution:

1.It makes loans to cotton buyers and to mills
on cotton held in warehouses or in transit.
2.It checks the credit of the mill's prospective
customers.
3.It cashes accounts receivable.
4.It makes advances against merchandise for
the account of mill, converter, or jobber.
5.It finances merchandise and raw material requirements,
and current operations.
6.It deals in acceptances, specializing, of course,
upon paper arising out of transactions in the
textile industry.
7.It maintains an Industrial Department, which
includes:
(a)the services of a consulting architect, expert
in mill construction.
(b)the services of a production engineer,
skilled in the laying out of plants in the line
of greatest efficiency, and in diagnosing
and correcting the production mistakes
of an inefficient mill.
(c)information as to the newest mill practice,
which it is ready to provide for its
clients and others.
(d)readiness to assist customers in the expansion
of their business either by financing
new mill construction or by providing
sales representatives in other countries.
(e)maintenance offices abroad, either for the
buying or selling of textiles or equipment,
or raw materials, or for the complete and
direct financing of such transactions.

38

CHAPTER VI

American Cloth in Foreign Markets

WE have seen that the American cotton grower supplies more than half of the world’s demand for raw cotton. The cotton manufacturer in the United States is in no such position. This is not to say that American cotton goods are not exported in very considerable amounts. From the inception of the industry in this country varying percentages of the total product have been sent abroad. The following table, taken from the United States Statistical Abstract (1910) shows the average annual exports of cotton goods for the five year periods named, expressed in millions of dollars:

Total Uncolored
Cloth 		Colored
Cloth 		Other
1856-60 $7.5 $2.4 $2.3 $2.8
1861-65 3.7 .4 .9 2.4
1866-70 4.1 .9 .3 2.8
1871-75 3.1 1.7 .6 .7
1876-80 10.0 6.1 2.6 1.2
1881-85 13.0 8.0 2.9 2.1
1886-90 12.4 7.4 3.2 1.6
1891-95 13.3 7.7 3.0 2.5
1896-1900 20.4 11.6 4.4 4.3
1901-05 31.3 17.2 7.0 7.0
1906-10 35.1 16.8 7.2 11.0

The irregularity of the export trade, as shown by these figures, has been explained on several grounds, the chief factors being, apparently, the fluctuations in the prosperity and consequently in the buying power of the home market, and the pressure upon the home market exerted by the rapid growth of cotton manufacturing in the South.

The normal position of the United States as an exporter of cotton goods is shown by the following table, which gives the exports of the chief manufacturing countries in the year before the war (the figures for 1915 are also given because they show the changes which had already begun):