A dry-goods buyer will sometimes spend a month in New York, the first third or half of which he will devote to ascertaining what goods are in the market, and what are to arrive; also to learning the mood of the English, French, and Germans who hold the largest stocks. Sometimes these gentlemen will make an early trial of their goods at auction. Unsatisfactory results will rouse their phlegm or fire, and they declare they will not send another piece of goods to auction, come what may. For local or temporary reasons, buyers sometimes persist in holding back till the season is so far advanced that the foreign gentlemen become alarmed. Their credits in London, Paris, and Amsterdam are running out; they are anxious to make remittances; and then ensues one of those dry-goods panics so characteristic of New York and its mixed multitude; an avalanche of goods descends upon the auction-rooms, and prices drop ten, twenty, forty per cent., it may be, and the unlucky or short-sighted men who made early purchases are in desperate haste to run off their stocks before the market is irreparably broken down. Whether, therefore, to buy early or late, in large or in small quantities, at home or abroad,—are questions beset with difficulty. He who imports largely may land his goods in a bare market and reap a golden harvest, or in a market so glutted with goods that the large sums he counts out to pay the duties may be but a fraction of the loss he knows to be inevitable.
In addition to the problems belonging to time and place of purchasing, to quantities and prices, there is a host of other problems begotten of styles, of colors, of assortments, of texture and finish, of adaptation to one market or another. The profit on a case of goods is often sacrificed by the introduction or omission of one color or figure, the presence or absence of which makes the merchandise desirable or undesirable. Little less than omniscience will suffice to guard against the sometimes sudden, and often most unaccountable, freaks of fashion, whose fiat may doom a thing, in every respect admirably adapted to its intended use, to irretrievable condemnation and loss of value. And when you remember that the purchases of dry-goods must be made in very large quantities, from a month to six or even twelve months before the buyer can sell them, and that his sales are many times larger than his capital, and most of them on long credit, you have before you a combination of exigencies hardly to be paralleled elsewhere.
The crisis of 1857 brought a general collapse. Scores and scores of jobbers failed; very few dared to buy goods. Mills were compelled to run on short time, or to cease altogether. The country became bare of the common necessaries of life. In process of time trade rallied. Manufacturing recommenced; orders for goods poured in; and for a twelve-month and more the manufacturer has had it all his own way. His goods are all sold ahead, months ahead of his ability to manufacture. He makes his own price, and chooses his customer. This operates not unkindly on the jobbers who are wealthy and independent; but for those who have but lately begun to mount the hill of difficulty, it offers one more impediment. For, to men who have a great many goods to sell, it is a matter of moment to secure the customers who can buy in large quantities, and whose notes will bring the money of banks or private capitalists as soon as offered. Against such buyers, men of limited means and of only average business-ability have but a poor chance. There will always be some articles of merchandise in the buying or selling of which they cannot compete.
When a financial crisis overtakes the community, we hear much and sharp censure of all speculation. Speculators, one and all, are forthwith consigned to an abyss of obloquy. The virtuous public outside of trade washes its hands of all participation in the iniquity. This same virtuous public knows very little of what it is talking about. What is speculation? Shall we say, in brief and in general, that it consists in running risks, in taking extra-hazardous risks, on the chance of making unusually large profits? Is it that men have abandoned the careful ways of the fathers, and do not confine themselves to small stores, small stocks, and cash transactions? And do you know who it is that has compelled this change? That same public who denounce speculation in one breath, and in the next clamor for goods at low prices, and force the jobber into large stores and large sales at small profits as the indispensable condition of his very existence.
Those who thus rail at speculation are generally quite unaware that their own inexorable demand for goods at low prices is one of the principal efficient causes of that of which they complain. They do not know that the capacious maw of the insatiable public is yearly filled with millions on millions of shirtings and sheetings, and other articles of prime necessity, without one farthing of profit to the jobber. The outside world reason from the assumption, that the jobber might, but will not, avoid taking considerable risks. They do not consider, for they do not know, how entirely all is changed from the days and circumstances in which a very small business would suffice to maintain the merchant. They do not consider, that, an immense amount of goods being of compulsion sold without profit, a yet other huge amount must be so sold as to compensate for this. Nor do they consider that the possibility of doing this is often contingent upon the buyer's carefully calculated probability of a rise in the article he is purchasing. Many a time is the jobber enabled and inclined to purchase largely only by the assurance that from the time of his purchase the price will be advanced.
The selling of dry-goods is another department in high art about which the ignorance of outsiders is ineffable. I was once asked, in the way of courtesy and good neighborhood, to call on a clergyman in our vicinity,—which I did. Desirous of doing his part in the matter of good fellowship and smooth conversation, he began thus:—
"Well, now, Mr. Smith, you know all about business: I suppose, if I were to go into a store to buy goods, nineteen men out of twenty would cheat me, if they could; wouldn't they?"
"No, Sir!" I answered, with a swelling of indignation at the injustice, a mingling of pity for the ignorance, and a foreboding of small benefit from the preaching of a minister of the gospel who knew so little of the world he lived in. "No, Sir; nineteen men in twenty would not cheat you, if they could; for the best of all reasons,—it would be dead against their own interest."
Not a day passes but the question is asked by our youths who are being initiated in the routine of selling goods,—"Is this honest? Is that honest? Is it honest to mark your goods as costing more than they do cost? Is it honest to ask one man more than you ask another? Ought not the same price to be named to every buyer? Isn't it cheating to get twenty-five per cent. profit? Can a man sell goods without lying? Are men compelled to lie and cheat a little in order to earn an honest living?" What is the reason that these questions will keep coming up? That they can no more be laid than Banquo's ghost? Here are some of the reasons. First, and foremost, multitudes of young men, whose parents followed the plough, the loom, or the anvil, have taken it into their heads, that they will neither dig, hammer, nor ply the shuttle. To soil their hands with manual labor they cannot abide. The sphere of commerce looks to their longing eyes a better thing than lying down in green pastures, or than a peaceful life beside still waters, procured by laborious farming, or by any mechanical pursuit. Clean linen and stylish apparel are inseparably associated in their minds with an easy and elegant life, and so they pour into our cities, and the ranks of the merchants are filled, and over-filled, many times. Once, the merchant had only to procure an inviting stock, and his goods sold themselves. He did not go after customers; they came to him; and it was a matter of favor to them to supply their wants. Now, all that is changed. There are many more merchants than are needed; buyers are in request; and buyers whose credit is the best, to a very great extent, dictate the prices at which they will buy. The question is no longer, How large a profit can I get? but, How small a profit shall I accept? The competition for customers is so fierce that the seller hardly dares ask any profit, for fear his more anxious neighbor will undersell him. In order to attract customers, one thing after another has been made "a leading article," a bait to be offered at cost or even less than cost,—that being oftentimes the condition on which alone the purchaser will make a beginning of buying.
"Jenkins," cried an anxious seller, "you don't buy anything of me, and I can sell you as cheap as any. Here's a bale of sheetings now, at eight cents, will do you good."