Art. 7.-BRITISH TRADE AND MANUFACTURES.

1. Diplomatic and Consular Reports. Edited at the Foreign Office and Board of Trade. Wyman, 1916.

2. Psychology and Industrial Efficiency. By Hugo Münsterberg. Constable, 1913.

3. Industrial Training; with special reference to conditions in London. By N. B. Dearle. King & Son, 1914.

4. Commercial Theory and Practice. By W. Abbott. Murray, 1915.

AT the present time every effort is being made to develop the productive power of this country, not only on account of the war material needed by our navy and army, but also with a view to increasing our exports, which to a large extent constitute the payment made by us to foreign nations for munitions, food, and other necessities. After the war is over, these efforts must be continued and even augmented if we are to keep up our position as a manufacturing and exporting nation. The maintenance of our productive power is therefore of vital consequence, whether in war or peace; and it behoves us to consider how this can be done in spite of the enormous number of men employed directly or indirectly upon war service, and the eventual shortage of hundreds of thousands of industrial workers who will have been killed, or disabled from returning to work.

For the first year or two after peace is declared, the 'entente' nations and their colonies will probably refuse to buy goods of German origin. The natural feeling of resentment is likely, however, to die down more quickly than many people imagine, particularly where the individual's pocket is concerned; and German goods can only be excluded in the long run by high tariffs or by less costly and more attractive products. There is not the slightest doubt that, when war broke out, we had fallen behind Germany in efficiency of manufacture in certain lines, many of our goods being dearer and not so well suited to the uses for which they were designed. In order to achieve success in future we must produce better and cheaper goods than the Germans.

As regards output, British workmen and workwomen are as good as any in the world, but there will be a sad

reduction in the number of men available; hence, unless the remainder are more effectively employed, together with a much larger proportion of women than heretofore, we shall not be able to maintain our position. Germany will also be suffering from a dearth of men to an even greater extent than is likely to be the case with us, but she will strive hard to surpass us by employing more women and by using all her great powers of education and organisation to increase her industrial efficiency. We must also remember that the United States is making and will make a strong bid for the trade Germany has lost during the war, and that, while her factories have been to a certain extent converted for the purpose of supplying the belligerents with war materials, her industrial army has remained intact.

Industrial operations in every country consist of production, transport, and marketing, whether the goods are for home consumption or for export. The raising of coal and the growing of crops and live-stock must of course be included under this head. As regards production, the goods produced must be at least equally attractive in quality and price with those offered by other countries, otherwise they cannot be sold. These features imply equal industrial efficiency with nations whose workers are paid similar wages for an equal output, and in which similar natural advantages exist in the form of minerals and favourable climatic conditions. Transport is dependent upon productive efficiency, both as regards the means employed, such as railways and ships, and the wages paid to labour for given results, while natural advantages again affect the cost. Although we may produce attractive goods and transport them efficiently, they will not compete successfully with the products of other nations unless our methods of selling them are equally effective.

Now, German goods were extensively sold in this country before the war, while in foreign markets German trade, although not so large as our own, was extending more rapidly. Moreover, as regards production and transport, the advantages of one side over the other, if any, were with the British manufacturer. The competition existing between America and this country also showed similar features in spite of the high wages paid

in the United States. Our failure to compete successfully with Germany and America, though enjoying at least equal advantages, is a sure sign that our methods for the production, transport and marketing of certain goods were not so efficient as those of our competitors. It therefore behoves us to consider very carefully where our industrial efficiency can be improved and what is being done by our foreign rivals in this direction.

These matters can best be discussed in the sections enumerated below, which are given as nearly as possible in the order of their importance; that is to say, we have failed in the past more signally in the directions dealt with under the earlier headings.

(1) Cooperation within each Industry.
(2) The marketing of the goods.

(3) Designs, inventions and discoveries.
(4) Organisation.

(5) Commercial education.

(6) Government support for trade.

Cooperation within each Industry.-Many of us will remember the attack made upon our tobacco industry by an American combination some years ago, and the way in which this attack was met and repulsed. British tobacco manufacturers, when working together, were then able to oust the enemy, whereas singly they must inevitably have been beaten. Foreign competition has now reached a stage at which we can no longer afford to ignore the advantages of cooperation. Among these advantages may be mentioned the following:

(a) Orders can be so apportioned to the various factories that each may make the type, size and quantity of goods best suited to its capabilities. Instead, for instance, of a dozen factories each making twelve different sizes of some complex machine, one size only can be made in each factory, thereby greatly reducing the cost of production.

(b) Materials can be bought in huge quantities and distributed where required, thus effecting large reductions in prices and the cost of handling when compared with the present system. Another advantage of dealing in materials on a large scale is that they can be inspected and tested before despatch by high-class experts-a plan which is too costly with small consignments. Again,