Chocolate Wars

by Deborah Cadbury

  CHICAGO, ILLINOIS

  In 1893, Chicago was host to a great exhibition: The Columbian Exposition. Twenty-seven million visitors showed up to view the most exciting inventions of the industrial world: engine-powered vehicles, electric lights, telephones, brand new household creations of every description. Among the crowds, one man kept returning to the machinery building: Milton Snavely Hershey.

  There was one stall in particular that caught his eye. A German manufacturer, J. M. Lehmann of Dresden, displayed his latest designs for making chocolate. Lehmann had a long-standing reputation for the quality of his machinery. In fact, it was his firm that provided the engineering know-how that helped Van Houten develop his first cocoa press. Now Lehmann unveiled something that intrigued Hershey: a chocolate factory in miniature. The raw beans were roasted and then crushed by granite rollers, producing an aromatic stream of chocolate liquor. Sugar, cocoa butter, and flavorings were added before the mix was set in molds. Hershey was mesmerized, taking in every step of the process. After pondering this deeply for some time, he then turned to his cousin, Frank Snavely: “Frank,” he declared, “I’m going to make chocolate!”

  Hershey knew that American cocoa imports, although modest compared to Europe, were rising fast. Europeans were consuming 100 million pounds of chocolate per year—while Americans only consumed 25 million pounds—an amount that had almost tripled in ten years. Yet in just a generation, with immigration and rapid pace of progress, America was becoming the greatest industrial power in the world—outproducing Germany, France, and Britain combined. America’s vast mass market would surely wake up and smell the chocolate.

  Hershey was a gambling man, and by the 1890s, he felt he was on a winning streak. After fourteen years of ceaseless labor, two failed businesses, and a lawsuit, things were finally going his way.

  He had come a long way from the turmoil of 1886 in New York. After borrowing $10,000 to help fund the sale of the cough drops his father so believed in, he found he was unable to repay the loan. Every day as he had labored in his basement enterprise by the elevated railway, the gulf between what he could make in profit and his escalating debt widened. According to one sad tale in the Hershey archives, in a last determined bid to raise the money, Milton hired a horse and wagon. With the cart brimming over with sweets and cough drops, Hershey went out in search of new customers. When he entered a sweetshop, a gang of youths looking for some fun put firecrackers under the wagon. Milton emerged from the shop to see his terrified horse bolting up the street, the wildly veering wagon scattering its precious load in all directions. Stripped of hope that he would meet the deadline to make a partial payment on his $10,000 loan, he sold everything and went home to Pennsylvania.

  This second failure proved decisive. His determination to succeed channelled steely grooves through his personality. He had learned so much, why work for someone else when he could try again? Unfortunately he found his own resolve was equally matched by that of his mother’s family. No more money was forthcoming. The charming youth who had carried all their hopes of fifteen years ago had been transformed into the twenty-nine-year-old man, greying prematurely, who was a bitter disappointment. Money was not available. Not so much as a penny.

  In 1886, with no capital available, it was back to basics for Milton Hershey. He believed in his new recipe for caramels. It bore a remarkable similarity to the recipe he had learned in Denver, Colorado, using milk instead of paraffin to create the creamy chew. No one on the East Coast was making a caramel quite like it. Hershey started once more, peddling his sweet dream from a pushcart around the streets of Lancaster, Pennsylvania.

  This time, people came back for more. He couldn’t make them fast enough. The sales made it possible for him to rent workspace in a warehouse. He had to share it with noisy neighbors—a carriage works and a piano manufacturer among others. But he had room for his kettles and sugar stores. Once again his mother and his Aunt Mattie came to help with wrapping the sweets. As word spread, in a stroke of extraordinary luck, a British traveller passing through town in 1887 placed a big order for caramels to ship to England. Hershey duly set off to the banks in Lancaster to secure a loan to buy equipment to fulfill the deadline. No one would back him.

  Hershey’s luck finally turned when Frank Brenneman, the cashier at Lancaster National Bank, agreed to loan him $700. But it turned again when he failed to repay the money within the agreed-upon ninety days. Worse still, he required an extra $1,000 to meet the English delivery. The records show that Brenneman, knowing full well that his superiors at the bank would turn down the request, authorized the additional funds personally. Unknown to the bank, Hershey now owed them $1,700 and some sort of payment was soon due, if another slide down the ladder on Hershey’s life was to be avoided. The familiar sickening situation had caught up with him again. He awaited his fate in the warehouse. Into the gloom, a letter from England arrived. Expecting more bad news—the ship had sunk, the caramel was inedible—he opened the letter to find a check for £500. He was still in business. It was a turning point. The sun had begun to shine on Milton Hershey.

  From that point on, Hershey’s Lancaster Caramel Company started to reach out to the fast-growing industrial cities of the East Coast. Somehow his family managed to keep his father, Henry Hershey, at bay before he could spoil it. Milton Hershey was soon in a position to open what he loved to call his “western branch” in Chicago, followed by another branch in Pennsylvania at Reading and a shop on Canal Street in New York City. By the early 1890s, he was employing some 1,000 staff. The surge in immigration, the explosion in consumer demand, and skillful use of new types of machinery: it all helped his business grow at an astonishing rate. “Milton Hershey has made a complete success of his life so far,” declared The Portrait and Biographical Record of Lancaster County in 1894. Noting that his company did over a million dollars of business a year with exports to Europe, Asia, and Australia, they concluded, “No man stands higher in business and social circles in the city of Lancaster than this man, who has been crowned with success.” It was quite a turnaround.

  When Milton Hershey travelled to the Chicago exhibition in 1893, he was a man of substance with money to spend. A man who no longer lived from hand to mouth but had a grand brick house in his hometown of Lancaster filled with soft furnishings, fine art, and other luxuries he had been denied as a child. On his last day there, he bought Lehmann’s entire display: the chocolate factory in miniature.

  In 1894, when George Cadbury was moving into his manor house, Lehmann’s chocolate machine was hidden unobtrusively inside the factory of the Lancaster Caramel Company, and it started to produce Hershey’s own chocolate. The first attempts were not auspicious. They were coarse and dry compared to the Swiss milk chocolate. But Hershey was a great experimenter, and he began to test out different ideas: chocolate wrapped around caramel, chocolate cigars with exotic sounding names like Hero of Manila and fancy chocolates with imposing French titles such as Le Roi de Chocolat.

  Hershey took frequent research trips to check out the competition. In New York in 1896, he met Catherine Sweeney, the young daughter of Irish immigrants who worked as a clerk in a candy store in Jamestown. The beautiful “Kitty” proved to be an irresistible and charming confection, and Hershey’s trips to New York took on a new urgency. Wide differences in their ages and backgrounds and his mother’s disapproval counted for nothing. The pretty Irish immigrant became Mrs. Milton Hershey in no time at all and moved into her husband’s house in Lancaster in 1898.

  But Kitty was no Quaker wife. Unlike George’s wife, Elsie, with her air of sobriety and plain clothes buttoned to the neck, Kitty had a sensational wardrobe crammed with the latest fashions. While Elsie was applauded in Birmingham for her generous charitable works, Kitty was learning how to spend Milton’s money for him, and her flirtatious style attracted comment. At least one Lancaster resident confided to being so taken by her beauty that she could not resist spying outside her house, hoping for a glimpse of the woman who pr
ovided such an exotic contrast to the closed, religious community.

  Hershey indulged Kitty’s desire to travel with long trips to Europe. Hershey had a purpose to these visits. While she enjoyed the shopping, Hershey went to see the British and continental chocolate manufacturers. He had heard about the chocolate works at Bournville, both through his burgeoning export trade and from admiring reports in fashionable American magazines such as Cosmopolitan New York.

  Annie Diggs, a reporter for Cosmopolitan New York, took a tour of Bournville in 1903 and could see for herself the results of William Harvey’s designs. “The very streets of Bournville laugh in the face of crude conventionalism,” she declared. “The monotony of capitalistic housing . . . with rows of all-alike houses is prohibited.” In its place were tree-lined walkways set out in curves and angles “that follow the natural undulation of the land in all its native beauty.” She applauded the commercial basis of the village. “Even the lowest priced of the cottages affords . . . attractive interior features, alluring gardens and environment soul-satisfying to refined tastes—and all this at less cost than one clammy blackened room in a fever haunted city court where human creatures herd from birth to death.” She even praised the gardening: “Why it is the very joy of life among the villagers! . . . The men not being overworked in the factory go straight to their gardens with keen delight.” She caught sight of “gloriously happy youngsters . . . skipping after their fathers . . . with spade and barrow to work their allotments after factory hours.”

  At the chocolate works, Diggs was impressed by the efforts to improve the health of the employees and described the recreation grounds “with charming woodland haunts.” She found the Quaker owner a passionate advocate for his scheme: “We must destroy the slums of England or England will be destroyed by the slums,” said George Cadbury. “We must give English children a chance to grow. We must not house our workers in a vile environment and expect their lives to be clean and blameless. We must do justice in the land.” For Annie Diggs, Bournville “was a good dream come true” that “invites duplication throughout England.” Indeed, she concluded, why stop there? “Why not the United States as well?”

  For Hershey it was a revelation—a model for the perfect business empire. While travelling to Europe with Kitty, he almost certainly had a chance to visit Bournville to see for himself what Quaker philanthropy could achieve. From his carriage, Hershey took in the neatly cultivated gardens and village green bordered by friendly clusters of houses. He travelled the shady streets, each one named after trees that added to the feel of a country haven: Willow Road, Oak Tree Lane, Hay Green Lane, Selly Oak Road, Holly Grove. Hershey saw it as some kind of improbable utopia as he watched the modern lights wink on in the village at dusk. What a thing to create: a little world set apart from the festering city. Hershey had never seen anything like it. This money-making idyll was the perfect community in miniature, an entire template for the rest of society. He was inspired.

  And there was more to inspire him on his trip through Europe: milk chocolate. Through the Lehmann brothers, he was introduced to Swiss chocolate manufacturers. Hershey’s chocolate experiments at his Lancaster Caramel Company had shown him that it was not easy to make a chocolate bar. He wanted to know how the Swiss created their superior milk chocolate. There are unconfirmed reports that while in Europe, Hershey attempted a little industrial espionage, although he remained silent on this issue. Some claim that he was hired in Swiss chocolate factories without revealing his interest. Other sources imply that he lured staff away from chocolate firms by promising them better deals if they joined his enterprise.

  Whatever the truth, by 1899, the King of Caramel had made a radical decision. He would sell his caramel company. “Caramels are just a fad,” he reasoned, convinced his sales had peaked. “But chocolate is a food as well as a confection. I’ll stake everything on chocolate!” After prolonged negotiations, in August 1900, he finally received a check for $1 million for his Lancaster Caramel Company. Basking in his newfound status, the former pushcart vendor to whom no one would lend money was now a millionaire occasionally to be seen cruising around in the first “horseless carriage” on the streets of Lancaster.

  Milton Hershey had a new dream: He would build a factory in a cornfield and open the Hershey Chocolate Company, the largest chocolate works in the world. He too would create a model town around his chocolate works. And he would build this American Bournville where he started out as a child in Pennsylvania’s Dauphin County near Derry Church.

  There was, however, just one obstacle. He had the expertise to build a business and the resources to create his chocolate town.

  But a key ingredient was missing.

  He did not have the recipe for Swiss milk chocolate.

  PART III

  CHAPTER 11

  Great Wealth Is Not to Be Desired

  Richard Cadbury was a passionate supporter of the Egypt Exploration Fund, formed in the late nineteenth century to conduct excavations on sites in the Nile Delta that “had rarely been visited by travellers.” In January 1897, he embarked on a tour with his family to see these hidden treasures, an experience of “unclouded happiness,” recalled Richard’s daughter, Helen. After touring Egypt, the Quaker party made their way to Palestine, with Bibles in hand as a guide. They wanted to retrace the steps of biblical heroes such as Joseph and Moses, seeing what they saw, feeling what they felt. When their carriage drove through the Jaffa Gate into Jerusalem, “We were all quiet,” wrote Richard’s wife, Emma. “It seemed so strange and wonderful to be in the city of which from babyhood we had heard and read and sung.” The trip was so inspiring that Richard was soon planning their return.

  On February 2, 1899, he and his family set sail once again for Cairo. “I wish you could all see father,” Emma wrote home. “He is most enthusiastic, taking rubbings and drawings wherever he can.” The family could not resist visiting the Pyramids, and they rode on camels to see the Sphinx. Someone took a photograph: a moment frozen in time. It shows a happy group of Europeans laughing in the sunshine—the women in prim, high-necked blouses, long skirts, and boaters; the men dressed like country squires; except for Richard. Happy, sunburned, he had turned native and looked in his long, flowing robes as though he would never return to the land of grey skies.

  Shortly after a trip up the Nile, sixty-four-year-old Richard felt unwell. The doctor dismissed it as nothing of consequence; an ordinary case of “Nile throat.” Richard did not fuss. He was eager to see Jerusalem again and pressed on with the tour. By the time he arrived, after a two-day carriage ride from Jaffa during which he was unable to eat or drink, he was clearly more seriously ill.

  Richard’s decline was terrifyingly rapid. He grew weak and frail, and within three days, he was slipping in and out of consciousness. Emma saw his eyes open and “brighten with a joyous surprise . . . as he . . . gazed upon some glorious sight that was hidden from her.” In that moment she felt a frightening certainty “that he could never come back to earth again.” During the night of March 21, before she could summon the children, Emma watched her husband die as quickly and quietly as a candle being blown out.

  At Bournville, George had no idea his brother was ill, and it was a shock when the telegram arrived from Egypt. He had only just received Richard’s happy letter from Abu Simbel: “The sun had set when we anchored . . . so that we could only see in the shadow of the rocks a faint outline of the mammoth statues that guarded the celebrated temple of Rameses the Great.” It was a terrible loss. As brothers and partners, their lives had been bound together. The early days at Bridge Street were still vivid, and George’s mind was alive with images of everything they had shared. Almost as one mind they had conjured up the dream of a utopia and by sheer determination made it work. It was hard to believe that forty years had elapsed. Hard to believe that the brother who in robust health just weeks earlier had walked with him around newly completed almshouses that he had donated to Bournville would never again be seen around the vill
age. His body lay on a cold slab in the cemetery at Lodge Hill.

  Over the spring and summer of 1899, the family catastrophe prompted a complete reorganization of the chocolate factory. The Cadbury brothers had already agreed that in the event that either of them died, the firm would be reorganized as a private limited company, handing opportunities down to the next generation. Accordingly, Richard and George’s oldest sons found themselves joint managing directors of the vast enterprise. For the four Cadbury cousins, it was a complicated inheritance.

  Richard’s oldest son, thirty-seven-year-old Barrow, had a decidedly nonmaterialistic streak that sat incongruously with the directorship of a large chocolate firm. He was intensely committed to the Society of Friends and promoted its ideals such as peace and the unity of churches. With his eye for detail, he was scrupulous in the management of Bournville’s cashiers department. He also delighted in introducing new technology: adding machines that could print on paper tape, typewriters for the office, and telephones that could be installed through the recently formed National Telephone Company. Barrow’s brother, thirty-two-year-old William, favored the outdoor life like his father. He already had ten years’ experience at Bournville running the engineering department and introducing machinery to keep pace with new product lines. Now he took responsibility for sales and was involved in sourcing cocoa for the firm.

  Their two cousins, George’s oldest sons, had less experience in the family factory. Twenty-three-year-old Edward, a shy man known for his business acumen, was appointed to lead the fast-growing export department, and he hastily made plans to check on sales teams across the world. His twenty-one-year-old brother, George Jr., who had a passion for science, found himself on the front line of arguably the most nerve-wracking assignment of all: creating new brands with which to challenge the Dutch and the Swiss.