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 business principles, were restrained from selling some of the largest d
 tributors of ladies' handbags in the country.

 Previous to the code, the discount allowed purchasers for the. prompt
 Payment of their invoices was not observed to any great extent, payments
 .being made long after the due date with the full amount of discount ied4
 Few, if any manufacturers, were willing to return checks for this reasoA
 fearing to incur the displeasure of their customers. As a result, not q
 than 40% of all accounts were paid promptly on the due date. When the d
 prohibited the granting of discounts in excess of 3/10 eom, the manufacd
 records show that fully 8)% of their customers paid promptly on the due:
 in order that they might earn the cash discount.

 The trade practice rules under the code benefited the industry gre
 ly. They furnished the manufacturers a reason for refusing the demands
 the retailers to engage in unfair trade practices. The most important
 beneficial trade practice rule was the cone which fixed the terms of sal
 the industry. The reason for the industry failing to show a profit for
 first four years of the depression, veas due perhaps more than anything
 to the granting of discount and terms wholly unwarranted. The industry
 earned not more than 1% in discounts and granted 8%. More than 50% of
 manufacturer's cost represents a cash outlay, yet the industry was fort'
 grant terms of 30 to 45 days from the date of shipment.

 In a number of cases, manufacturers refused to avail themselves o0
 benefits afforded them by these trade practice rules in the code, and.
 continued some of these unfair trade practices, despite the efforts" of
 the Directors of the code to prevent them front doing s*o. The most efff
 tive instrument for compliance under the code was the label. The cbop.
 ation given by the retailers in refusing to accept any product of the
 .try without the label, had the effect of restraining the manufacturers.
 violating the code.

 In the year 1934, the first year of the operation of the code, th.
 handbag manufacturers reported profits, most of the manufacturers repo..
 their first profits since 1929, others reported more profits than any
 since 1929. The supply houses selling to the handbag manufacturers r
 ed .a feeling of greater security in selling to the industry. The mant
 ers were meeting their obligations more promptly, and there were fewer
 ures in the industry than there had been in five years, past. The re1
 reported an increase in the sales volume of handbags, due in great par
 the incentive given to create more and attractive styles of handbags,
Cause the manufacturers were operating on a profitable basis.

 There were not any great difficulties encountered in organizing
 administration, other than the settlement between factions in the ind
 as to the number of representatives each was entitled to have on the
 Authority. All other matters were left to the Directors of the Code .
 ty to take care of, which were approved by the industry. The matter 0
 presentation on the Code Authority was adjusted when a number of impo'r
 manufacturers moved their factories away from New York and joined the.
 of outside manufacturers. Opposing trade associations were then merg..
 there was little or no further opposition. The industry had no diffic
 in financing code administration.. Labels were sold at $2.50 a thousa
 alike to all manufacturers. The amount paid by a manufacturer for la..


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