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An official early policy of the federal government was to trade with the Native Americans. A system of factories (government-owned trading posts) was established and maintained, with the hope that such a system would create harmony with the tribes and make them more dependent upon government supplied goods, and thereby more subject to its control.
Factories existed from 1795 to 1822 in the South and the newly opened Old Northwest Territory. The government trader, or factor, was to provide quality goods at a fair price, usually only slightly above cost, to the Indians. Goods included tools, clothing, tobacco, utensils, and sometimes weapons and ammunition. These were traded for animal skins and fur.
The factory system was abolished by the federal government in 1822, following the War of 1812 and the financial Panic of 1819.
Factories or Trading Posts
List of factories and their years of operation in the order of their establishment. 
Colerain, 1795-97 (Creek)
Fort Wilkinson, 1797-1806 (Creek)
Ocmulgee Old Fields, 1806-9 (Creek)
Fort Hawkins, 1809-16 (Creek)
Fort Mitchell, 1816-20 (Creek)
Tellico, 1795-1807 (Cherokee)
Hiwassee, 1807-10 (Cherokee)
Fort Wayne, 1802-12
Fort St. Stephens, 1802-15 (Choctaw)
Fort Confederation, 1816-22 (Choctaw)
Detroit Factory, 1802-5
Chickasaw Bluffs Factory, 1802-18
Arkansas Factory, 1805-10
Belle Fontaine Factory, 1805-9
Natchitoches-Sulphur Fork Factory, 1805-23
Chicago Factory, 1805-22
Fort Edwards Factory, 1818-23
Fort Madison Factory, 1808-15
Mackinac (Michilimackinac) Factory, 1808- 12
Osage Factory, 1808-23
Green Bay Factory, 1815-23
Prairie du Chien Factory, 1815-22
Sandusky Factory, 1806-12
Spadre Bluffs (Illinois Bayou) Factory, 1818-24.
The factor at each trading house was supposed to keep rather extensive financial records for the time, including day books, ledgers, journals, letter books, cashbooks, and invoice books. Not all were diligent in keeping such records and few recorded the names of individual Indians in the records they did keep. Most of the records of the factories were general or reports of their activity. While these records likely will not provide detailed information about individual Indians, they do contain history of the traders, the trading posts, and the tribes with which they dealt. Most of the records which have survived from the factories are in the National Archives in the Records of the Office of Indian Trade, 1795-1830.
- ↑ Guide to Records in the National Archives of the United States Relating to American Indians. Compiled by Edward E. Hill. National Archives and Records Service General Services Administration. Washington, D.C. C. 1981. page 20.
- Hill, Edward E. Guide to Records in the National Archives of the United States Relating to American Indians. Washington, D.C., National Archives, 1984.
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