I give this list to explain what I said before, namely, that there is no particular place in England, where all the manufactures are made, but every county or place has its peculiar sort, or particular manufacture, in which the people are wholly employed; and for all the rest that is wanted, they fetch them from other parts.[41]

But, then, as what is thus wanted by every particular person, or family, is but in small quant.i.ties, and they would not be able to send for it to the country or town where it is to be bought, there are shopkeepers in every village, or at least in every considerable market-town, where the particulars are to be bought, and who find it worth their while to furnish themselves with quant.i.ties of all the particular goods, be they made where and as far off as they will; and at these shops the people who want them are easily supplied.

Nor do even these shopkeepers go or send to all the several counties where those goods are made--that is to say, to this part for the cloth, or to that for the lining; to another for the b.u.t.tons, and to another for the thread; but they again correspond with the wholesale dealers in London, where there are particular shops or warehouses for all these; and they not only furnish the country shopkeepers, but give them large credit, and sell them great quant.i.ties of goods, by which they again are enabled to trust the tailors who make the clothes, or even their neighbours who wear them; and the manufacturers in the several counties do the like by those wholesale dealers who supply the country shops.

Through so many hands do all the necessary things pa.s.s for the clothing a poor plain countryman, though he lived as far as Berwick-upon-Tweed; and this occasions, as I have said, a general circulation of trade, both to and from London, from and to all the parts of England, so that every manufacture is sold and removed five or six times, and perhaps more, before it comes at the last consumer.

This method of trade brings another article in, which also is the great foundation of the increase of commerce, and the prodigious magnitude of our inland trade is much owing to it; and that is giving credit, by which every tradesman is enabled to trade for a great deal more than he otherwise could do. By this method a shopkeeper is able to stock his shop, or warehouses, with two or three times as much goods in value, as he has stock of his own to begin the world with, and by that means is able to trust out his goods to others, and give them time, and so under one another--nay, I may say, many a tradesman begins the world with borrowed stocks, or with no stock at all, but that of credit, and yet carries on a trade for several hundreds, nay, for several thousands, of pounds a-year.

By this means the trade in general is infinitely increased--nay, the stock of the kingdom in trade is doubled, or trebled, or more, and there is infinitely more business carried on, than the real stock could be able to manage, if no credit were to be given; for credit in this particular is a stock, and that not an imaginary, but a real stock; for the tradesman, that perhaps begins but with five hundred, or one thousand pounds' stock, shall be able to furnish or stock his shop with four times the sum in the value of goods; and as he gives credit again, and trusts other tradesmen under him, so he launches out into a trade of great magnitude; and yet, if he is a prudent manager of his business, he finds himself able to answer his payments, and so continually supply himself with goods, keeping up the reputation of his dealings, and the credit of his shop, though his stock be not a fifth, nay, sometimes not a tenth part, in proportion to the returns that he makes by the year: so that credit is the foundation on which the trade of England is made so considerable.

Nor is it enough to say, that people must and will have goods, and that the consumption is the same; it is evident that consumption is not the same; and in those nations where they give no credit, or not so much as here, the trade is small in proportion, as I shall show in its place.

FOOTNOTES:

[38] [The amount of trade produced by the British colonies is still great; but it has been ascertained that it is not profitable to the nation at large, as much more is paid from the public purse for the military protection required by the colonies, than returns to individuals through the medium of business.]

[39] [The cotton manufacture has now the prominence which, in Defoe's time, was due to those of wool and silk.]

[40] [It is scarcely necessary to remind the reader, that the ca.n.a.l navigation of England has come into existence since the date of this work--the railway communication is but of yesterday.]

[41] [Since Defoe's time, little alteration has taken place in the locality of a number of manufactures in England; but, in the interval, an entire change has been effected in Scotland, which now possesses various manufactures of importance in the commercial economy of the nation. We need only allude to the cambrics, gauzes, and silks of Paisley; the cottons and other goods of Glasgow; the plaidings of Stirlingshire; the stockings of Hawick; the printing-paper of Mid-Lothian; the carpets and bonnets of Kilmarnock; the iron of Muirkirk and Carron; the linens of Fife and Dundee; and the shawls of Edinburgh.]

CHAPTER XXIV

OF CREDIT IN TRADE, AND HOW A TRADESMAN OUGHT TO VALUE AND IMPROVE IT: HOW EASILY LOST, AND HOW HARD IT IS TO BE RECOVERED

Credit is, or ought to be, the tradesman's _mistress_; but I must tell him too, he must not think of ever casting her off, for if once he loses her, she hardly ever returns; and yet she has one quality, in which she differs from most of the ladies who go by that name--if you court her, she is gone; if you manage so wisely as to make her believe you really do not want her, she follows and courts you. But, by the way, no tradesman can be in so good circ.u.mstances as to say he does not want, that is, does not stand in need of credit.

Credit, next to real stock, is the foundation, the life and soul, of business in a private tradesman; it is his prosperity; it is his support in the substance of his whole trade; even in public matters, it is the strengh and fund of a nation. We felt, in the late wars, the consequence of both the extremes--namely, of wanting and of enjoying a complete fund of credit.

Credit makes war, and makes peace; raises armies, fits out navies, fights battles, besieges towns; and, in a word, it is more justly called the sinews of war than the money itself,[42] because it can do all these things without money--nay, it will bring in money to be subservient, though it be independent.

Credit makes the soldier fight without pay, the armies march without provisions, and it makes tradesmen keep open shop without stock. The force of credit is not to be described by words; it is an impregnable fortification, either for a nation, or for a single man in business; and he that has credit is invulnerable, whether he has money or no; nay, it will make money, and, which is yet more, it will make money without an intrinsic, without the _materia medica_ (as the doctors have it); it adds a value, and supports whatever value it adds, to the meanest substance; it makes paper pa.s.s for money, and fills the Exchequer and the banks with as many millions as it pleases, upon demand. As I said in last chapter, it increases commerce; so, I may add, it makes trade, and makes the whole kingdom trade for many millions more than the national specie can amount to.

It may be true, as some allege, that we cannot drive a trade for more goods than we have to trade with, but then it is as true, that it is by the help of credit that we can increase the quant.i.ty, and that more goods are made to trade with than would otherwise be; more goods are brought to market than they could otherwise sell; and even in the last consumption, how many thousands of families wear out their clothes before they pay for them, and eat their dinner upon tick with the butcher! Nay, how many thousands who could not buy any clothes, if they were to pay for them in ready money, yet buy them at a venture upon their credit, and pay for them as they can!

Trade is antic.i.p.ated by credit, and it grows by the antic.i.p.ation; for men often buy clothes before they pay for them, because they want clothes before they can spare the money; and these are so many in number, that really they add a great stroke to the bulk of our inland trade. How many families have we in England that live upon credit, even to the tune of two or three years' rent of their revenue, before it comes in!--so that they must be said to _eat the calf in the cow's belly_. This encroachment they make upon the stock in trade; and even this very article may state the case: I doubt not but at this time the land owes to the trade some millions sterling; that is to say, the gentlemen owe to the tradesmen so much money, which, at long run, the rents of their lands must pay.

The tradesmen having, then, trusted the landed men with so much, where must they have it but by giving credit also to one another? Trusting their goods and money into trade, one launching out into the hands of another, and forbearing payment till the lands make it good out of their produce, that is to say, out of their rents.

The trade is not limited; the produce of lands may be and is restrained.

Trade cannot exceed the bounds of the goods it can sell; but while trade can increase its stock of cash by credit, it can increase its stock of goods for sale, and then it has nothing to do but to find a market to sell at; and this we have done in all parts of the world, still by the force of our stocks being so increased.

Thus, credit raising stock at home, that stock enables us to give credit abroad; and thus the quant.i.ty of goods which we make, and which is infinitely increased at home, enables us to find or force a vent abroad.

This is apparent, our home trade having so far increased our manufacture, that England may be said to be able almost to clothe the whole world; and in our carrying on the foreign trade wholly upon the English stocks, giving credit to almost all the nations of the world; for it is evident, our stocks lie at this time upon credit in the warehouses of the merchants in Spain and Portugal, Holland and Germany, Italy and Turkey; nay, in New Spain and Brazil.

The exceeding quant.i.ty of goods thus raised in England cannot be supposed to be the mere product of the solid wealth and stocks of the English people; we do not pretend to it; the joining those stocks to the value of goods, always appearing in England in the hands of the manufacturers, tradesmen, and merchants, and to the wealth which appears in shipping, in stock upon land, and in the current coin of the nation, would amount to such a prodigy of stock, as not all Europe could pretend to.

But all this is owing to the prodigious thing called credit, the extent of which in the British trade is as hard to be valued, as the benefit of it to England is really not to be described. It must be likewise said, to the honour of our English tradesman, that they understand how to manage the credit they both give and take, better than any other tradesmen in the world; indeed, they have a greater opportunity to improve it, and make use of it, and therefore may be supposed to be more ready in making the best of their credit, than any other nations are.

Hence it is that we frequently find tradesmen carrying on a prodigious trade with but a middling stock of their own, the rest being all managed by the force of their credit; for example, I have known a man in a private warehouse in London trade for forty thousand pounds a-year sterling, and carry on such a return for many years together, and not have one thousand pounds' stock of his own, or not more--all the rest has been carried on upon credit, being the stocks of other men running continually through his hands; and this is not practised now and then, as a great rarity, but is very frequent in trade, and may be seen every day, as what in its degree runs through the whole body of the tradesmen in England.[43]

Every tradesman both gives and takes credit, and the new mode of setting it up over their shop and warehouse doors, in capital letters, _No trust by retail_, is a presumption in trade; and though it may have been attempted in some trades, was never yet brought to any perfection; and most of those trades, who were the forwardest to set it up, have been obliged to take it down again, or act contrary to it in their business, or see some very good customers go away from them to other shops, who, though they have not brought money with them, have yet good foundations to make any tradesmen trust them, and who do at proper times make payments punctual enough.

On the contrary, instead of giving no trust by retail, we see very considerable families who buy nothing but on trust; even bread, beer, b.u.t.ter, cheese, beef, and mutton, wine, groceries, &c, being the things which even with the meanest families are generally sold for ready money.

Thus I have known a family, whose revenue has been some thousands a-year, pay their butcher, and baker, and grocer, and cheesemonger, by a hundred pounds at a time, and be generally a hundred more in each of their debts, and yet the tradesmen have thought it well worth while to trust them, and their pay has in the end been very honest and good.

This is what I say brings land so much in debt to trade, and obliges the tradesman to take credit of one another; and yet they do not lose by it neither, for the tradesmen find it in the price, and they take care to make such families pay warmly for the credit, in the rate of their goods; nor can it be expected it should be otherwise, for unless the profit answered it, the tradesman could not afford to be so long without his money.

This credit takes its beginning in our manufactures, even at the very first of the operation, for the master manufacturer himself begins it.

Take a country clothier, or bay-maker, or what other maker of goods you please, provided he be one that puts out the goods to the making; it is true that the poor spinners and weavers cannot trust; the first spin for their bread, and the last not only weave for their bread, but they have several workmen and boys under them, who are very poor, and if they should want their pay on Sat.u.r.day night, must want their dinner on Sunday; and perhaps would be in danger of starving with their families, by the next Sat.u.r.day.

But though the clothier cannot have credit for spinning and weaving, he buys his wool at the stapler's or fellmonger's, and he gets two or three months' credit for that; he buys his oil and soap of the country shopkeeper, or has it sent down from his factor at London, and he gets longer credit for that, and the like of all other things; so that a clothier of any considerable business, when he comes to die, shall appear to be 4000 or 5000 in debt.

But, then, look into his books, and you shall find his factor at Blackwell Hall, who sells his cloths, or the warehouse-keeper who sells his duroys and druggets, or both together, have 2000 worth of goods in hand left unsold, and has trusted out to drapers, and mercers, and merchants, to the value of 4000 more; and look into his workhouse at home, namely, his wool-lofts, his combing-shop, his yarn-chamber, and the like, and there you will find it--in wool unspun, and in yarn spun, and in wool at the spinners', and in yarn at and in the looms at the weavers'; in rape-oil, gallipoli oil, and perhaps soap, &c, in his warehouses, and in cloths at the fulling-mill, and in his rowing-shops, finished and unfinished, 4000 worth of goods more; so that, though this clothier owed 5000 at his death, he has nevertheless died in good circ.u.mstances, and has 5000 estate clear to go among his children, all his debts paid and discharged. However, it is evident, that at the very beginning of this manufacturer's trade, his 5000 stock is made 10,000, by the help of his credit, and he trades for three times as much in the year; so that 5000 stock makes 10,000 stock and credit, and that together makes 30,000 a-year returned in trade.

When you come from him to the warehouse-keeper in London, there you double and treble upon it, to an unknown degree; for the London wholesale man shall at his death appear to have credit among the country clothiers for 10,000 or 15,000, nay, to 20,000, and yet have kept up an unspotted credit all his days.

When he is dead, and his executors or widow come to look into things, they are frightened with the very appearance of such a weight of debts, and begin to doubt how his estate will come out at the end of it. But when they come to cast up his books and his warehouse, they find,

In debts abroad, perhaps 30,000 In goods in his warehouse 12,000

So that, in a word, the man has died immensely rich; that is to say, worth between 20,000 and 30,000, only that, having been a long standard in trade, and having a large stock, he drove a very great business, perhaps to the tune of 60,000 or 70,000 a-year; so that, of all the 30,000 owing, there may be very little of it delivered above four to six months, and the debtors being many of them considerable merchants, and good paymasters, there is no difficulty in getting in money enough to clear all his own debts; and the widow and children being left well, are not in such haste for the rest but that it comes in time enough to make them easy; and at length it all comes in, or with but a little loss.

As it is thus in great things, it is the same in proportion with small; so that in all the trade of England, you may reckon two-thirds of it carried on upon credit; in which reckoning I suppose I speak much within compa.s.s, for in some trades there is four parts of five carried on so, and in some more.

All these things serve to show the infinite value of which credit is to the tradesman, as well as to trade itself; and it is for this reason I have closed my instructions with this part of the discourse. Credit is the choicest jewel the tradesman is trusted with; it is better than money many ways; if a man has 10,000 in money, he may certainly trade for 10,000, and if he has no credit, he cannot trade for a shilling more.

But how often have we seen men, by the mere strength of their credit, trade for ten thousand pounds a-year, and have not one groat of real stock of their own left in the world! Nay, I can say it of my own knowledge, that I have known a tradesman trade for ten thousand pounds a-year, and carry it on with full credit to the last gasp, then die, and break both at once; that is to say, die unsuspected, and yet, when his estate has been cast up, appear to be five thousand pounds worse than nothing in the world: how he kept up his credit, and made good his payments so long, is indeed the mystery, and makes good what I said before, namely, that as none trade so much upon credit in the world, so none know so well how to improve and manage credit to their real advantage, as the English tradesmen do; and we have many examples of it, among our bankers especially, of which I have not room to enter at this time into the discourse, though it would afford a great many diverting particulars.[44]

I have mentioned on several occasions in this work, how nice and how dainty a dame this credit is, how soon she is affronted and disobliged, and how hard to be recovered, when once distasted and fled; particularly in the story of the tradesman who told his friends in a public coffee-house that he was broke, and should shut up his shop the next day. I have hinted how chary we ought to be of one another's credit, and that we should take care as much of our neighbour tradesman's credit as we would of his life, or as we would of firing his house, and, consequently, the whole street.

Let me close all with a word to the tradesman himself, that if it be so valuable to him, and his friends should be all so chary of injuring his reputation, certainly he should be very chary of it himself. The tradesman that is not as tender of his credit as he is of his eyes, or of his wife and children, neither deserves credit, nor will long be master of it.

As credit is a coy mistress, and will not easily be courted, so she is a mighty nice touchy lady, and is soon affronted; if she is ill used, she flies at once, and it is a very doubtful thing whether ever you gain her favour again.

Some may ask me here, 'How comes it to pa.s.s, since she is so nice and touchy a lady, that so many clowns court and carry her, and so many fools keep her so long?' My answer is, that those clowns have yet good breeding enough to treat her civilly; he must be a fool indeed that will give way to have his credit injured, and sit still and be quiet-that will not bustle and use his utmost industry to vindicate his own reputation, and preserve his credit.

But the main question for a tradesman in this case, and which I have not spoken of yet, is, 'What is the man to do to preserve his credit? What are the methods that a young tradesman is to take, to gain a good share of credit in his beginning, and to preserve and maintain it when it is gained?'[45]

Every tradesman's credit is supposed to be good at first. He that begins without credit, is an unhappy wretch of a tradesman indeed, and may be said to be broke even before he sets up; for what can a man do, who by any misfortune in his conduct during his apprenticeship, or by some ill character upon him so early, begins with a blast upon his credit? My advice to such a young man would be, not to set up at all; or if he did, to stay for some time, till by some better behaviour, either as a journeyman, or as an a.s.sistant in some other man's shop or warehouse, he had recovered himself; or else to go and set up in some other place or town remote from that where he has been bred; for he must have a great a.s.surance that can flatter himself to set up, and believe he shall recover a lost reputation.

But take a young tradesman as setting up with the ordinary stock, that is to say, a negative character, namely, that he has done nothing to hurt his character, nothing to prejudice his behaviour, and to give people a suspicion of him: what, then, is the first principle on which to build a tradesman's reputation? and what is it he is to do?