MOTORING NEWS AND VIEWS FOR THE CAR OWNER AND THE TRADE |
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| Topics: Studebaker, Cole
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Augustus J. Fertig
The Washington Herald
October 10, 1913
Between the engineer who designs an automobile, and the manufacturing genius who builds it, there intervenes a step which, while never of a spectacular sort, is nevertheless of mighty importance, determining to a great extent the price at which the car profitably can be sold.
This step is the purchase of material. To the man under whose direction this task is performed, the automobiling-buying public owes a large share of the increasing value that is being put into the popular-priced American automobile.
The purchasing agent is a specialist in values of materials. He knows the reputation of every large maker of materials, and the capacity of his plant. He is a veteran student of human nature—wary, resourceful and shrewd.
An example of scientific buying ability is Chester J. Reynolds, through whose department The Studebaker Corporation buys annually many millions of dollars worth of supplies, varying in value from the pencil of a stenographer to the most costly automobile materials and equipment.
Mr. Reynolds' experience dates back 26 years to his first job in the purchasing department at the Studebaker in plant South Bend. His transfer to the automobile plants in Detroit occurred several years ago and implied a change in detail only.
Backed by the immense Studebaker buying power, Mr. Reynolds daily entertains an interesting series of callers at this office in the Detroit headquarters.
Representatives of big steel mills; salesmen of high-grade leather and paint; builder of automobile equipment; manufacturers of machine tools, and a host of others complete for the Studebaker business.
Guided by a definite policy, Mr. Reynolds sits in judgement. He must be satisfied regarding quality; if there is any doubt involved, the Studebaker laboratory determines that by analysis and experiment. He must be satisfied on the seller's financial standing and ability to make deliveries according to schedule. He must be satisfied that the price finally agreed upon is reasonable, but will still allow the salesman's firm a margin of profit. This last provision makes it necessary to know the last word regarding manufacturing cost.
The experienced salesman is fully aware of all these conditions. He knows also that the Studebaker contract will mean continuous operation for the manufacturer he represents, and a successful season as a result. Just how great a saving this represents to the purchaser of a car may be imagined from the fact that a manufacturer of material or equipment is almost always ready to quote, on prices ordered in lots of 50,000, a price approximating one-third or less of what is charged for the same piece at retail list.