Who does not like chocolate? The names of the most famous producers of this sweet product are constantly on hearing. In America, the leader is the company Hershey Foods. True, at present the sweet giant is going through not the best of times. Speech even rose about the sale of the company because of the surging problems. The buyers were found quite quickly, and the deal promised to become profitable for all parties.
But the residents of the town of Hershey themselves interfered. But the sale of the company could bring its owners a record 15 billion dollars for the industry. Among the potential buyers were such giants as American Wrigley, English Cadbury and Swiss Nestle.
Only under pressure from the public Hershey Trust took the final decision to abandon the deal. The Board rejected all offers of purchase, having addressed with wishes to stop possible sale. Such unexpected turn of business is explained by the unusualness of the brand itself. Hershey Foods allegedly left the textbook of Utopian socialists, or maybe just embodies the religious views of its creator. It was this unusual appearance that prevented the company from selling it so easily.
Milton Hershey, whose name was given to the company, was born in 1857. He was born in the small town of Derry Church, in Pennsylvania. The Milton family was very religious. The ancestors of the family came to the country in the XVIII century from Switzerland and Germany. In America, a group of compatriots created a small community. That’s why Milton began to speak not in English, but in some unusual “Pennsylvanian-Dutch language.” The family moved often, as a result, at school, Milton graduated only four classes.
True, the mother did not aspire to her son to give a normal secular education. In her opinion, books only harm. That’s why, at the very first opportunity, Milton was given professional skills. At first, the teenager worked a bit as an assistant to the printer, but polygraphy did not entice Milton, and he became a pupil of a local confectioner. He sold ice cream and cheap caramel. Milton liked this work so much that he plunged into this craft with his head, cherishing the hope of opening his own business in the future.
However, the first attempts to start a business – in Denver, New York, Chicago, Philadelphia and New Orleans, ended in failure. It’s good that Hershey was able to find out from a confectioner a secret well known to everyone today. It turned out that for taste, caramel should be diluted with fresh milk. This discovery inspired Milton so much that he made a new attempt, this time in Lancaster. Tired of the useless activity of Hershey, his relatives refused to help him, only his mother and aunt got on his side.
After a series of experiments, Milton came up with an original caramel recipe called Hershey’s Crystal A. This was the beginning of the glory. The new caramel was liked not only by Americans, but also by foreign importers. After receiving a major order from England, Milton decided to take out a loan in the Lancaster National Bank. Instead of presenting a surety, Milton gave his caramel a taste of the head of the bank. He eventually vouched for a novice businessman, believing in it. Money made the enterprise prosperous, the sale of caramel made Milton Hershey by 1894 one of the richest inhabitants of Lancaster.
Finally, he got the first in his life free money. The American rich people at that time loved to travel a lot, Hershey did the same. He traveled around France, Mexico, Egypt and England. At the same time he examined not only museums, but also shops, as well as factories, factories, wholesale enterprises. Hershey started useful business contacts, and also drew new ideas for his business. Having earned his first million in the production and sale of caramel, Milton decided not to stop. His world fame and a huge fortune he got thanks to chocolate.
And the idea to do exactly it came to Hershey at the World Exhibition in 1893 in Chicago. There, the businessman was impressed by German equipment for the production of chocolate.Hershey immediately bought the equipment and brought her to Lancaster. First in the new shop was created a glaze for caramel, a bit later the range was expanded with cocoa for drinking and chocolate for baking. By the end of the 1890s, Hershey finally decided to switch to a new direction. In 1900, he made his wealthy business was sold to competitors for an impressive amount of one million dollars. The American himself left only one shop for the production of chocolate.
Hershey had to start looking for a place to build a new plant. For this he returned to his native Derry Church. He had already bought his parental home, giving it to his father, and now he decided to settle there himself. It was bribed that there were a lot of unemployed people in the city who would gladly go to work for a new factory. And a large number of farms near Derry would give milk necessary for the production of chocolate. That is why the decision was made – in 1903 the construction of the factory began, and from 1905 it began to work.
But to recoup the investment needed was a real hit product. Then Hershey thought about creating a recipe for original milk chocolate, which could compete with recognized Swiss brands. The businessman never tired of experimenting, trying new ideas, combinations, additives. So the bar appeared Hershey’s, which became a favorite delicacy of Americans for many years. And in 1907, the light saw another bestseller – chocolate sweets Hershey’s Kisses.
The idea of their creation also belonged to the head of the company. Interestingly, having become rich, Hershey did not become a miser. Moreover, his religious views did not allow him to rejoice in wealth, while his compatriots lived in poverty. But the businessman could not just distribute the money he earned. He saw his mission in creating new jobs, as well as in maintaining unique for those times working conditions for employees.
Around the factory in Derry Hershey a whole city grew up, to which Hershey gave his name. There was everything necessary for the life of workers and their families – churches, banks, shops, parks, laundries, golf courses, a hotel and even a zoo. In this city, the majority of employees lived, but also those who lived outside Hershey, the businessman did not forget – a special tram line was built, so that the path to the factory was easier.
During the Great Depression in Hershey, the second building boom took place. To ensure the work of all needy residents, Milton even began to build a huge hotel in the Mediterranean style. And the prototype for it was the Cairo Heliopolis Hotel, which struck the businessman during his trip to Egypt. May 26, 1933 the official opening of the hotel, in honor of which the party for 400 people was organized! And a year later the hotel also opened a golf club, a little later appeared and a hall for balls.
But the most important charitable act of the “King of chocolate” was the opening in 1909 of an industrial school. Since 1951, it bears the name of its founder. Unfortunately, Milton and his wife could not have children, so they gave all their love and care to the orphans. And let Hershey himself grew up in a full-fledged family, his childhood was also not easy. Therefore, the millionaire considered himself obliged to limit as many children as possible from difficulties. Hershey remembered that he had not finished his studies, so he took care of getting his pupils not only professional skills, but also high-quality secondary education.
In 1915, the wife of Hershey died, and in 1918 he himself wrote a will. According to him, his personal fortune, at that time about $ 60 million, was supposed to go to the school. And this decision remained unchanged until the death of a businessman in 1945. Now Hershey Foods is a public company, but Hershey Trust owns a 31% stake in the school itself. The school also controls 76% of the company’s voting shares.
It is interesting that Hershey always closely communicated with the American military.For example, in 1937 the army appealed to the president of the company with a request to create a new bar specifically for soldier rations. The new product should weigh no more than four ounces, it is good to tolerate high temperatures, be nutritious and, if possible, have a pleasant taste. After several experiments, chocolate appeared that satisfied all the requirements. This bar could withstand temperatures of up to 50 degrees and contained 600 calories.
The official name of “Ration D” people was changed to “Logan’s bar”, in honor of the military customer. At first, the army’s orders were not very large, but World War II required streaming production. In 1939, Hershey produced 100 thousand bars a day. And in 1943 the military demanded to create an improved version of the product, so there was a new hit – Hershey’s Tropical Chocolate Bar. This chocolate together with the space crew Apollo even visited the moon.
After the death of the founder, the company continued its chosen market strategy. For example, Hershey did not like advertising – he believed that a good product would say about himself. As a result, until the mid-1960s, the company did not even have its own marketing department. For a time such an approach worked – having tasted in the army of bars, Americans continued to remain faithful to the brand and after the end of the service. This even served as a reason for the suit, satisfied, by the way, about excessive predilection for chocolate.
By the early 1970s, management realized that the company was beginning to become morally obsolete. This applied to both production and image in the market. Over time, Hershey Foods lost even the leadership in the domestic market to the eternal rival of Mars. The decision on restructuring the company is now ripe. For the first time, managers were invited from outside, with good education and experience in marketing. Previously it was believed that the manager must certainly work at Hershey Foods for many years. The company built new plants and modernized existing ones, it expanded due to external acquisitions.
Thanks to such measures, Hershey Foods returned to an honorable first place in the American sweets market. True, success in business was struck by tradition. So, in 2001, Richard Lenny became the first outsider in the history of the company. He disregarded the principles of Milton Hershey, deciding to make cuts, closing non-core businesses, selling products in cheap stores. This led to the longest in the history of the company strike in 44 days, which caused concern among shareholders and the desire to sell the shares of the chocolate giant.
True, the experts did not understand why to sell such a legendary business. On the side of the company stood the inhabitants of Hershey, and the patriots’ army was headed by the Attorney General himself. As a result, the court banned Hershey Trust from selling anyone to the company. So the public and traditions won the greed for profit and business calculation.