REPORT OF THE PANAMA RAILROAD COMPANY. _ 91 PURCHASE AND SHIPPING. Grocerves and staples —Contracts for groceries and staples are made quarterly through commissary purchasing officers located in New York, New Orleans, and San Francisco. Requisitions are placed about 60 days prior to the time the first shipment is to be made, thus enabling the purchasing officers to procure the fullest competition from various parts of the United States and to conclude contract of purchase and make arrangements for shipments in time to protect our requirements. This plan has worked out very satisfactorily to the department and to the merchants in general, placing those in New Orleans, San Francisco, and other points on the same basis as mer- chants located in New York or in the territory adjacent thereto. We are also enabled to procure the products of California delivered to us at a price that saves transportation across the continent, the goods being delivered on the Isthmus of Panama by water trans- portation. This has effected a great saving to the employees by enabling them to obtain California food products as cheaply as they can be bought in California. - | The line of groceries and staples is required to be equal to a sample which represents the highest grade that can be procured in the United States, this being necessary on account of the difficulty in preserving goods from deterioration in this climate that do not grade up to a very high standard in preserving and packing. The line of groceries, cigars, tobaccos, etc., is what would ordinarily be found in a high-class store in the United States. The plan of purchasing in lots to cover our requirements for a period of three months enables the department to buy in very large quanti- ties and, therefore, at the very lowest figures obtainable in the market. Our standing arrangement provides for the purchase of the greater portion of our groceries and staples free on board vessel at port of ship- ment, thus making it possible to pay for the goods at that time and take advantage of cash discounts obtainable. All foodstuffs are fur- nished under a guaranty that they will keep in this climate for a period of three months, and the contractors are assessed for the value of the spoilage of any goods delivered under this guaranty. Dry goods and notions, boots, shoes, hardware, etc—The purchase of dry goods and notions conforms in general to the methods outlined above in the purchase of groceries and staples—except that we buy in lots required from time to time, anticipating our requirements about 60 days in advance, competition being required wherever it is possible to obtain it. Owing to the quantities in which we purchase, we are enabled to purchase, to a large extent, from the manufacturers direct, thus obtaining goods at factory prices. There are necessarily a number of proprietary articles on which it is impossible to secure competition. There is no indication, however, that we are not receiving the very lowest prices for these articles, as we are able to sell them, in many cases, cheaper than they are sold for in the United States. - Our stock of dry goods and notions is varied and covers everything that a man or woman would require for wearing apparel and articles of necessary use in this climate. The large quantities of this line of goods purchased by the employees is a good indication that their requirements in this respect are being fully protected. s