the most part, to the mere auditing of freight bills and the handling of overcharge claims. Customarily under this plan, 50 per cent of the amount recovered accrues to the association, and 50 per cent to the client. On first thought this may seem rather high, but it must be borne in mind that the majority of railroad computations are correct, and that it is necessary to audit a great many bills before an error worth while is discovered. This is particularly true where a considerable portion of the bills represent small shipments.

Some of the larger auditing concerns take bills on a so-called "second or third audit." That is to say, the bills come from the traffic department of the client, or from some other auditing bureau to be reaudited. A single third-audit account has been known to yield sufficient returns to pay the office expenses of a rather large association.

The carriers look upon commercial auditing concerns as interlopers and usurpers of the functions of the shippers. They feel that the shipper need only call their attention to the error to be refunded the entire amount involved without dividing it with anyone.

The commercial audit bureaus defend themselves by pointing out that, tho many of their clients are not in the least conversant with transportation methods or charges, their business does not warrant the expense incurred in employing a traffic expert. Therefore, such industries would recover nothing if they were unable to avail themselves of the services of the commercial audit bureau. "Half a loaf is better than none."

The Measured Service Plan

Under the measured service plan, rates are furnished and bills are audited at a cost of so much per unit

This unit may be based on 100 quotations or revisions, or upon 1,000, and a sliding scale is established whereby there will be proportionate decrease in the charge for the second unit, and a similar reduction in the charge for the third. A charge might be established for the first thousand based on $5.00 per hundred, and each additional hundred, up to and including the second thousand, would be $4.50, and $4.00 per hundred might be the rate of charge for the third thousand.

The advantage of the graduated or measured service plan is that the bureau is compensated for the work performed. Perhaps the income may not be as large as that resulting from the percentage plan, but it is more certain, and, in the end, more satisfactory. Some of the leading traffic organizations of the country work under this plan.

The Membership Plan

Under the membership plan, the membership contributes to the support of the association on a predetermined rate of membership, ranging perhaps from $50 to $200 or more per annum. Out of this fund, the salary of the traffic commissioner is paid, and also whatever office expense he finds necessary in serving intelligently the members he represents.

This latter plan predominates largely in the traffic organizations of trade associations, and in the case also of community traffic organization.

EQUIPMENT

The shipping of a single industry, or even of several industries of allied lines, is covered by relatively

few publications. But in the case of an association of diversified lines of activity, the tariffs and transportation schedules must be more numerous, and the equipment more elaborate. A traffic library and other shipping adjuncts such as guides, atlases, tariffs, and directories are indispensable to the intelligent prosecution of such a work.

COLLECTION OF CLAIMS

Overcharges

When the collection of overcharges is attempted in the name of the audit association, difficulty is sometimes experienced in dealing with carriers who refuse to recognize the association as a party to the transaction between shipper and carrier. When such a contingency arises, the shipping client executes a power of attorney appointing the manager of the association an agent to act in the name of the industry in matters pertaining to transportation charges and any other detail which has been delegated to him, and directing payment to be made to him.

The more progressive organizations, however, are effecting the collection of the claim in the name of their client. For this purpose, the client furnishes the bureau a quantity of his letterhead which is used for letters accompanying claim papers to carriers. These letters are signed by the manager of the association as the traffic representative of the industry for whose account the claim is filed.

With an intelligent follow-up system and close coöperation with the industry, the association manager is informed of the payment of the claim, and can bill on the client for the association's proportion of the

recovery under the percentage plan of compensation. Under the measured service plan or under the membership plan, rendering of bills against the client or specific services of this kind is not contemplated, but the claim should be vigorously prosecuted until the matter is closed to the satisfaction of the client.

Loss and Damage Claims

These associations also specialize in the prosecution of claims involving loss or damage to property. This class of claims is attractive, as considerable amounts are usually involved, and, except in rare instances, the claims are largely questions of fact that can be easily substantiated. The basis of compensation under the percentage plan of operation is, consequently, materially reduced. The average charge assessed for collection of such claims is approximately 10 per cent. Furthermore, the industry agrees to bear any expense incurred if it becomes necessary to prosecute the issue thru the courts.

It is customary to retain some competent attorney in the locality as legal advisor to deal with all cases involving litigation. Such issues can then be prosecuted with a lesser aggregate expense to the association than if available talent were called upon from time to time as occasions demanded.

SERVICE

In addition to the collection of claims, many commercial associations of this type are inaugurating a type of service identical with that rendered by the quotation clerk of an industrial traffic organization to