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is often seen to good advantage. I have been confronted with it many times. When a business man goes into an advertising campaign of big proportions he is simply analyzing the future and staking his money on the accuracy of his dissection of human kind. He takes his knowledge of the market and his conclusions concerning human nature and invests his money on the result. "Clever advertising," we hear it called sometimes. It is clever simply because it is advertising based on the fundamental laws of life. Apply the same rules to all departments of a business, and you will get results equally good.

When I entered on my first big campaign of advertising I reopened, as it were, my account with "The Future of Hanan's Shoes." I was investing several hundred thousand dollars in a new analysis of the years to come. On the debit side of the mental ledger account I entered this

sum.

On the credit side went the reputation my goods had already attained and the probable results of the advertising. Again, on the debit side I had to put down the reputation that my competitors had and the opposition I` might have to overcome. So on, into a multitude of considerations, I had to go, debit and credit, for and against, until I struck a balance.

This balance was largely in favor of the proposition. Then came the further analysis of the methods to be pursued in the advertising itself. They had to be worked out and analyzed in still greater detail. The result was the first shoe-cut advertisement ever printed.

There may be instances in which successful advertising campaigns have been undertaken as a grain speculator buys wheat, but I do not recall any. The successful advertising man is analytical to the extreme, projecting every result from a definite cause. For every proposition

he has a corollary; every part of the plan must have its demonstration.

The habit of analysis in small things enables a business man to move confidently and firmly in large affairs. I remember that a number of years ago, when I announced my purpose of establishing retail shoe stores from which I could sell my product direct from factory to consumer, most of my business acquaintances predicted my speedy downfall. On every side I heard the prophecy: “John Hanan is committing business suicide. He may know how to make shoes, but he does n't know how to retail them. Why hasn't he the sense to let well enough alone?"

At that time it was an unheard-of thing for a shoe manufacturer to sell to the consumer. My acquaintances believed I was plunging into a great speculation, with the chances all against me. But a new enterprise is not necessarily a gamble because it is new. If it follows the logical lines of human nature and will bear this test of discriminating analysis, it is just as legitimate a business undertaking as if it belonged to a type a hundred years old. There was no speculation about this enterprise. I had satisfied myself of the logic of it by analyzing its possibilities away out into all their component fractions. The results justified the analysis.

Advice is something that business men get freely, but the only sort of advice they should heed is that which can be analyzed into something having real logic. If men advise you to do this, or not to do that, apply the scalpel to their warnings. If you find any real value in what they have to offer, incorporate it in your own analysis. The original and independent business man makes his own analysis true to nature, and goes ahead.

On another occasion a troublesome situation confronted

my business because of the action of certain shoe manufacturers whose competition threatened to be a serious disturbing element.

I got plenty of advice. "Answer the advertisements," I was urged. "Get back at them. Come out in a broadside advertisement yourself. If you don't, you are destroyed. Your competitors will carry off your trade."

Once more I opened up that convenient account, "The Future of Hanan's Shoes," just as I had opened and balanced it many times before. The debit and credit sides embraced a most careful analysis of human nature.

While the natural impulse was to plunge into an impetuous and hot-headed advertising controversy that would have cost a fortune and perhaps ended in disaster, the other course appealed to me as logical. Again I struck a balance in favor of silence.

The disturbing element I had feared had no effect in the end on the steady expansion of my business.

In relating these incidents of my own experience I trust I have given some idea of the value of a consistent policy of governing a business by logical analysis, day by day and year by year, always applying this test to undertakings big or small.

COÖPERATIVE TRADING1

By J. W. STANNARD

IXTY-THREE years ago twenty-eight weavers in a small manufacturing town in the north of England formed themselves into a society. to supply their families with the necessities of life.

Their meager initial capital of a few dollars was accumulated by small weekly payments of a few pennies. Mark the growth from this tiny beginning to the present day:

2262 individual coöperative retail organizations.

Membership of 2,258,158, representing 9,000,000 people nearly a quarter of the population of the British Isles. A share capital of $150,000,000.

An annual turnover of $500,000,000 and a profit of $50,000,000 each year.

After this two coöperative wholesale societies, the English society organized in 1863 and doing a business of $125,000,000 yearly, and the Scottish, organized five years later, doing a business of nearly $40,000,000 yearly.

Finally a string of manufacturing plants and allied industries, including everything from a coffee plantation in Java to a huge bank in England, having a turnover of $750,000,000 yearly.

The whole movement closely held together by a magnificent organization and doing an annual business of nearly $1,500,000,000.

It may be said that Great Britain is the home of the modern cooperative system. Spain has had its coöpera1 By courtesy of System. Copyright, 1908.

114

tive Compañía Gallega for centuries, Portugal its Sociedade Familiar, Russia its Artel, and other Slavic countries their Pomotch, their Druzhina, and their Wataga, all of which still exist in their crude original forms.

But it has been left to Great Britain to put the coöperative movement on a sound, modern, commercial basis, and to make it the greatest individual industrial force in the world.

The principles of coöperation were first preached to the masses by Robert Owen at the beginning of the eighteenth century, but not until the year 1844 was the real foundation of the movement laid in England. That year was a black page in England's industrial history. Machinery was being extensively introduced and was displacing manual labor to a great extent, and the effects of the resultant unemployment were further intensified by the effects of the corn laws, which, by artificially raising the price of bread during a period of industrial depression, created conditions which have given to that period of England's history the significant name of the "Hungry 'Forties."

It is not surprising, therefore, that the ideas of Robert Owen should have borne such fruit at this time. Forty Rochdale weavers set themselves to carry Owen's theories of abolishing "profit upon cost" into practice. A meeting was held, and it was decided to form a society for the purchase and distribution of goods for the benefit of the members, returning to each a portion of the "profit upon cost" included in the retail selling price. The initial capital was accumulated by means of small weekly payments, and, as the "Rochdale Equitable Pioneers," the society began to lay the foundation of that imposing structure which Lord Roseberry has so aptly named "A State within a State."

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