office. Invoices are made in duplicate, one copy being filed as a sales
sheet. The two copies of the order are filed with the corresponding
copies of the original order. A most satisfactory plan is to file one
copy numerically and one alphabetically, making a cross-index. A simple
form of back-order blank is shown in Fig. 7.
CHECKING SHIPMENTS
One of the vitally important problems in connection with shipping is
the proper checking of items in each shipment. To receive complaints
of shortages is very annoying to the shipper--especially so when he
is not in position to prove that the items claimed to be short were
shipped--but, rather than take the chance of losing a customer, he
usually pockets the loss.
[Illustration: Fig. 8. Order Blank with Column for Shipper's Check]
Shipments should be checked at every stage in the process of filing the
order, by everyone who handles the goods. The stock man should check
his part of the order as he assembles the goods, and again before he
forwards them to the shipping room, or the next floor. When received
in the shipping room, the goods should be checked against the shipping
clerk's order, and again just before they are packed.
It should be a positive rule that all goods shall be checked when they
are placed in the cases. The items should be called off by the packer
as he handles them, and checked on the order by a checker. This is a
safer plan than calling off the items from the order, as it insures a
positive check on the items actually packed--not what should have been
packed. All order blanks should be provided with a separate column
in which to check the items actually shipped, and quantities should
be entered in this column even if the order is shipped in full. The
checking column on the order blank is shown in Fig. 8. If the system
of entering orders includes a copy to be used as an invoice, the items
are entered in this column after the shipping order is returned to the
office.
The initials or numbers of both packer and checker should appear on the
shipping order. It is also a good plan to place in each case a packer's
slip, shown in Fig. 9, giving the number or initials of the packer and
instructing the customer to return the slip with any claim for shortage
or damaged goods. In some houses, it is the custom to make the packer's
slip a duplicate of the order, listing all items packed, in which case,
it makes a convenient receiving slip for the customer.
[Illustration: Fig. 9. Packer's Slip]
While not offering positive insurance against mistakes, a thorough
checking system will reduce errors in packing to a minimum, and will
most certainly pay for the labor involved. In large houses shipping a
large number of packages over several different railroads, a further
complication arises through the liability of deliveries being made to
the wrong freight house. Where several hundred shipments per day are
made, it is not uncommon for a teamster to leave a package at the wrong
road, finding himself short on his deliveries at another road; or the
mistake may be made in loading the drays.
One well-known mail-order house has overcome the difficulty in a simple
manner. This house is shipping several hundred packages a day by
freight, over eight railroads. The basis of their shipping system is a
color scheme, each railroad being designated by a different color--that
is, the New York Central is represented by green, the Erie by blue,
etc.
[Illustration: A FORTY-FIVE FOOT CABIN LAUNCH ON CAR Showing Method of
Loading Boats for Shipment at the Shipbuilding Plant of the Gas Engine
& Power Co. and Charles L. Seabury & Co., Consolidated]
The shipping floor is divided into sections, one for each railroad,
and one for each express company. The low partitions that separate the
sections are painted in the colors representing the railroads, and
over each is a sign bearing the name of the road, also printed in the
corresponding color. All packages are taken directly from the packing
room to the sections of the shipping floor representing the roads over
which they are to be shipped.
[Illustration: Fig. 10. Routing Package Labels]
In all blanks used in shipping, the same color scheme is carried out.
This includes shipping orders, packing orders, invoices, shipping
receipts, and labels. All orders are properly routed before they are
distributed to the billing machine operators for entry. Each operator
enters orders for certain railroads--from one to three, depending on
the distribution of the trade--and is supplied with blanks of proper
color for those roads only. Every order is then entered on blanks of
the color representing the railroad over which the shipment is routed.
In Fig. 10 is shown a label which represents this color scheme. Across
the end of the label is a solid block of color, with the name of the
road in an open letter. All printing on the label is also of the same
color. If the order is properly routed and entered, there is very
little chance for shipments to go astray. On every blank and on the
package itself, the color of the road is a prominent feature, and since
all blanks are written at the same time, they must correspond. Should a
package be placed in the wrong section, it is practically certain that
the error will be discovered when the goods are loaded on the dray.
EXPORT SHIPPING
Export shipping is a subject about which the average American house
knows but little, and herein appears to lie the cause of the loss of
much foreign trade. This is especially true of trade with other than
English-speaking countries. But the real fault lies farther back than
in the shipping department.
The trouble starts in the sales department. Export business is
undertaken without special preparation, and an attempt is made to apply
the methods used in handling domestic trade. Special instructions in
regard to packing, for instance, are ignored because the American
thinks he knows more than his customer in a foreign land.
Before export business is even attempted, the sales department should
become thoroughly familiar with conditions in the country with which
it wishes to do business. Some man in the department should study the
customs regulations, the descriptions necessary, the kind of packing
needed, and the size of package best adapted to the country. Above all,
he must study the desires of the trade, and conform to them, if he
expects to make and hold customers.
Special importance is attached to the question of packing and
describing the goods. No matter how unreasonable the request of the
customer or the foreign salesman may seem, it should be complied
with, for it is made for some good reason. A request of a merchant in
Omaha, ordering dry goods from Chicago, that goods ordinarily packed
in a large case be packed in small oblong boxes, might very properly
be ignored; but not so if the customer is located in a South American
republic. There, if the goods are to go to the interior, they must be
transported over the mountains on the backs of pack mules.
Besides making the packages of suitable size, goods for export must be
packed to withstand hard usage, and must be well protected against the
elements. Goods must be fully and accurately described in order that
they may pass the custom house. The dimensions of each package must be
shown on the shipping bills, for freight rates are based on the space
occupied in the hold of the ship, rather than on weight.
In a recent address on trade conditions in the Latin-American
countries, Wm. Harley Porter, Deputy Captain of the Port of Cienfuegos,
during the occupation of Cuba by the United States government, made
some very pertinent suggestions on these questions, some of which are
published by permission--as follows:
To secure South American trade, we must first train salesmen. They
must make an exhaustive study of the different South American tariffs
and at least know Spanish. They must be willing to accept instructions
as to shipping, and be powerful enough to insist that they be carried
out literally. And it would be a good thing for them to take a
kindergarten course in carpentry and blacksmithing, so that they would
not continue the stupid, expensive blunders of American houses in the
packing of goods.
I don't know how to drive that last statement home hard enough. Our
consuls plead with our exporters, and our Government distributes
volumes freely on the subject, yet there is no apparent improvement.
I confess that until I had some first-hand experience, I supposed that
the packing evil was a convenient sort of filler, with which Consuls
padded their reports for want of better material.
In order to fit out the custom house of Cienfuegos, Cuba, with new
office furniture, we placed an order amounting to nearly one thousand
dollars with a Chicago house that brazenly advertised that it made
a specialty of export business. Their booklet was encouraging, and
the prices really low. So we ordered roll-top and flat-top desks,
cashier's desks, office chairs, tables and card cabinets, and then
worried, for fear that the goods would not arrive before the end
of the fiscal year, then rapidly approaching, in which event, our
furniture appropriation would revert to the island treasury.
Six weeks from the day the order reached Chicago, the goods left
New York--time enough to have had them come from Hawaii. With the
goods came a single invoice. The vouchers in triplicate, which must
be filled properly before the account can be paid by a governmental
department, had been thrown aside as of no use. To protect the
exporter, a voucher was drawn, for the ship reached port on June 30,
the last day of the fiscal year. Several dollars were wasted in cable
messages to expedite the return of new invoices, and the goods were
unpacked.
Not one piece of furniture, save a few chairs, was found whole. No
American, in the States, would have accepted the goods. We had paid
for them. A letter of remonstrance brought back a churlish answer,
written in a cocky American spirit of superiority, to the effect
that possibly some one outside could tell that house something about
packing their own goods, but they would be greatly surprised to meet
such a person.
The trouble lay in the thinness of the packing cases. Goods are loaded
into a ship by casting a rope sling about their middle, by which they
are hoisted up and let down, often with a run, into the hold. Our
desks, without sufficient outer protection and not being built on
the principle of a truss bridge, naturally collapsed. The cases were
none too good for a railway journey, and were certain to be damaged
at any Central or South American port because, in nearly every case,
unloading is done from the ship to a lighter, and from the lighter, by
main strength and awkwardness, to a wharf.
I cannot recall one instance in which American houses carried out
instructions literally. I believe that there is a great future for
an American exporter who will let the man on the ground do his own
thinking, and take it for granted that he knows what he wants and how
he wants it. The exasperation of a man who is weeks or months away
from the markets, and who finds that substitution has been practiced,
or his goods so packed that destruction was plainly invited, cannot be
adequately described by a man on my income.
We bought a typewriter in New York, one time, for two reasons: We
could get the liberal discount, allowed the government if we bought
direct from the maker, and we could evade a 25% duty if we received
it through our custom house and not through another. Also there was a
line of steamers from New York to our wharf.
Some five weeks after placing the order, we were notified by an
express company in Havana that it had accepted for our account
a typewriter, and that when the duty, plus accrued express and
forwarding charges, amounting to $45.O3, were paid, it would be
dispatched in our direction.
We were out $40.03 because some fool shipping clerk had insisted on
trying to do our heavy thinking. We had given him the name of the
steamer by which the machine was to be shipped, but he had discovered,
in some way, that steamships will not make a bill for less than a
metric ton. That, he doubtless learned, would cost us $5.00. The
package only weighed about 30 lbs., so he started it off by express.
His brain did not carry far enough for him to learn that only one
American express company crossed the Florida Strait and naturally
chance took it to another company. Two changes were made in express
companies before the box reached the coast and the package sauntered
about in our beautiful Southland for more than a month before it
landed in Havana.
Had any Spanish merchant been subjected to the invariable annoyance
which fell to our lot when we endeavored to patronize American houses,
he would have given up in despair and remembered the adage of the
burnt child, forever.
And, unfortunately, the carelessness of American shippers often costs
the foreign merchants good, hard dollars. Tariffs in Latin-American
republics are fearfully and wonderfully made, and there is nothing
that a pin-headed government employe enjoys more than inflicting a
fine for a slip in complying with a little red tape.
Here is a case in point. A large house in Mexico City bought a carload
of chairs over here, and with the order sent the shipping forms
prescribed by the Mexican government. A very explicit letter was sent
also, saying that consular invoices would be provided by their custom
house broker in Laredo, who would receive the goods at the border, but
that the shipping forms must be filled out, each package numbered with
a serial number on the forms. Full description involved, of course,
a statement as to the kind of wood used, so that the duty might be
easily adjusted.
The goods, however, were simply consigned as so many bundles of
chairs, weight so much. The shipping lists were ignored. The innocent
receiver of those goods was fined both because they had not been
properly described and because the weight was grossly understated. It
cost the Mexican house $800 and when the American was asked to settle
the charges caused by carelessness, or pig-headedness, he merely
answered that he was not going to settle any bills with the Mexican
government.
The Mexican firm settled--it had to--and posted every importer in the
republic in the matter, so that not only will that American house not
sell any more chairs in Mexico, but Americans generally have been
given another black eye.
There is a good reason for careful custom regulations, and the
exporter should know that they are partly for his protection. For
instance, they usually require that a certain number, generally ten
per cent, of all packages shall be opened and compared with the
shipping list. If these packages, chosen at random, are correct, the
consignment is delivered. But if any variation is found, fraud is
assumed, and every package is thoroughly examined, usually with more
or less damage.
It is customary for English and German firms, in the packing of small
articles, to use different colored pasteboard boxes, which are often
decorated with pictures indicating the contents. For instance, in a
large packing case containing a stock of gentlemen's furnishings,
all collars will be in boxes of one color, socks in another, cravats
in another, etc. The large case is lined with tin, by the way, and
after packing, the tin joints are soldered around the top. Here is
the English system: First, the small boxes, individualized as much as
possible; then heavy wrapping paper, then a tin lining inside of an
outer wooden casing, the latter being well made and reinforced with
iron straps. Last of all, directions and addresses are stenciled in
large, clear block letters. The Germans often use oiled paper between
the tin and the inner packages, so that even if the tin is punctured,
the oiled paper will resist the sea air, which invariably injures
delicate fabrics.
The American idea seems to be to put as much as possible in a large,
thin box or a poorly bound bale. The European, whose agents study
conditions on the ground, knows that much interior transportation in
Latin America is packed by pack mule, and therefore uses medium-sized
oblong boxes, two of which make a good load.
I cannot emphasize too strongly the necessity for careful description
of goods to pass them through a custom house with the least
inconvenience. Mixed consignments must pay the highest duty assessed
against anything found in a lump or poorly described quantity. If you
deal in bolts, for instance, you may not merely say _1,000, 3×2×⅜
bolts_, but you should say whether they are cotton, linen, or woolen.
They have to know, before they can assess duty.
Instead of a ringing peroration about American pluck, progressiveness,
and other non-essentials, let me give you some shipping rules, if you
are going to have a try for South American trade.
Secure shipping list forms beforehand and find out if consular
invoices are needed.
Pack your goods in small packages, for you will pay freight on metric
tons and they are based on cubic measure and not on weight.
Pack well, for tons of stuff will probably lie on your cases.
Give each package a serial number and describe it by that number, on
the shipping forms.
If your goods can be damaged by sea water, use tin-lined cases.
Your invoices should show not only number, measurement, and exact
contents of each package, but their gross, tare, and net weight, for
in many cases the container must pay the same duty as the contents.
Be sure that your forwarding agent is reliable, for the law allows
him many charging privileges if you are careless in providing for
contingencies.
Contract, if you can, for through transportation and get from the
transportation companies the requisite export manifests to accompany
shipment.
Make triplicate invoices, one to accompany the goods and two to be
mailed to the consignee. One of these will be turned over to the
custom officials, so in case the invoice sent with the goods fails to
come through, and that often happens, the triplicate can be accepted.
Without an invoice your goods cannot leave the ship, and I know of
cases where cargoes have been held awaiting invoices for eight weeks.
And, in conclusion, remember that sentiment is not the foundation for
foreign trade. If we sell abroad we must do so on merit and by foreign
systems--not our own.
FREIGHT CLAIMS
Freight claims are an ever present source of annoyance. Every shipper,
and practically every receiver, of freight finds it necessary to make
claims against the railroads for freight overcharges, shortages, and
damages to goods in transit. Some houses find occasion to make but one
or two claims a year; others constantly have several claims on file,
aggregating a large number each year, but no matter what the number,
they must be given proper attention.
Handling freight claims is not one of the usual duties of the shipping
clerk, nevertheless, it is a proper topic for discussion in connection
with the subject of shipping. The traffic manager, when one is
employed, handles the freight claims; otherwise the details are handled
by some other minor official--as the cashier or the purchasing agent.
The adjustment of claims involves, usually, a large volume of
correspondence, and requires a man of tact. He must possess patience
and persistence to a marked degree. Diplomacy of a high order is
necessary in his correspondence, and promptness is an important factor.
Threats have little effect, other than to delay adjustment of the
claim.
Before a claim is presented, all information pertaining to the case
in possession of the claimant must be assembled, and all facts should
be incorporated in the papers filed. A bill should be made against
the railroad for the amount of the claim, and to this should be
attached the freight receipt or other voucher. These papers should
be accompanied by a letter giving a plain statement of the basis of
the claim; if for an overcharge, the number of the tariff and the
classification on which it is based should be cited. The claim papers
should be as complete as it is possible to make them, presenting all
facts having a possible bearing, otherwise they will be returned by
the claim agent of the railroad for further information. Some of the
questions asked by the claim agent may seem trivial to the claimant,
but the answers are necessary to him in completing the files of his
office. When claim papers are returned through the local freight
office, the information asked should be given and the papers returned
at once.
Claimants become very impatient over delays in the adjustment of their
claims, forgetting that where they handle perhaps a dozen claims
a year, the railroad claim agent must handle thousands, involving
amounts ranging from a few cents to many hundreds of dollars. They
also overlook the fact that a shipment has passed over several roads,
and that before the claim can be adjusted, it must be ascertained on
what road the damage was sustained. The different roads involved must
adjust the claim between themselves, before they can tell where the
money with which to pay it is coming from. The papers must pass through
the hands of agents at all junction and transfer points, and the claim
departments of all roads involved, before the claimant can expect a
reply.
On the other hand, it is not good business to rely solely on the
railroad. Claim papers sometimes repose indefinitely in the desk of
some local freight agent, until brought to light by a persistent
follow-up; occasionally the papers are lost. A follow-up of freight
claims is, therefore, a necessity. The shipper who is most persistent
in following up his claims, is usually the beneficiary of the most
prompt service.
Railroads number all claims as received, and invariably refer to them
by number. It is an excellent plan, therefore, for the shipper to adopt
a numerical system for the purpose of identification. It is quite
important that all correspondence relating to a claim be kept together,
and this is best done by using a folder for each claim. The number of
claims is so small that it is not necessary to use an entire drawer
for claims; they can be accommodated in the front of a drawer used for
regular correspondence.
[Illustration: Fig. 11. Folder for Freight Claims]
The outside of the folder should provide for the name and address of
the consignor or consignee, as the case may be, name of the railroad
on which claim is made, the shipper's claim number, and the railroad's
claim number, as shown in Fig. 11. In this folder, copies of the bill
and of all letters to the railroad company should be filed. The folders
are filed numerically, in the order of the shipper's claim numbers.
To follow up the claim, and to provide an index to the file of claim
folders, a card, similar in form to the one shown in Fig. 12, should be
used. This card provides for a complete history of the claim. At the
head of the card is shown the name of the consignor or the consignee,
shipping point, shipper's and railroad's claim numbers, dates of
shipment, receipt, and filing of claim, the railroad on which claim
is made, and the name of the claim agent. This is followed by a brief
statement of the nature and amount of the claim. The two bottom lines
provide for a record of the payment or rejection of the claim. All of
the information most likely to be needed is found by turning to this
card, without the necessity of consulting the correspondence in the
claim files.
[Illustration: Fig. 12. Card for Follow-Up of Claims]