Learning from…Henry John Heinz

Learning from…Henry John Heinz

Henry John Heinz was known for his high performance, ingenuity, and hard work. But, to be a successful entrepreneur, just like adding a little “special sauce,” you need a little more. Heinz found success because he was VERY attentive to the quality of his product and the people he employed.

In this Learning from InvENtors, we’re diving into the history of Heinz.

Early Life

The son of German immigrants, Henry John Heinz, known later in life as the “Pickle King,” was born on October 11, 1844, in Pittsburgh, Pa. When Heinz turned 6, he started to help around the garden. At 9, Heinz started selling homemade grated horseradish in downtown Pittsburgh. When he turned 10, Heinz’s parents gave him 3,000 square meters of land and by 12, he owned 12,000 square meters of land, perfect for growing vegetables. Gardening became his passion.

By the age of 16, he had several employees working to cultivate the hotbeds he had built and to deliver his produce to Pittsburgh grocers. In addition to product, Heinz also became known for selling horseradish from his mother’s recipe.

During this time, sadly, fooling customers was commonplace in US business. One of the local newspapers wrote, “In so-called horseradish we can find more turnips and water soaked wood sticks than an expected product.”

To combat this practice and show the high quality of his product, Heinz packed it in clear glass jars. Such openness and a great quality of the product made a good impression, thus increasing the popularity of the grated horseradish Heinz offered.

By the time Heinz graduated from the high school, his garden grew to such an extent that he hired employees. Henry earned $2,400 for the year of 1861 (he was just 17 years old). That amount would translate to approximately $43,000 today.

Even though he was experiencing early success, Heinz had a strong desire to keep learning. Using the money he earned from the sale of his vegetables, he financed his own education at Duff’s Mercantile College. Heinz learned how to keep records and accounting books which led to a strict accounting practices in his professional life.

After graduating from college, Heinz started working at his father’s brickyard. He learned all the intricacies of this business, made some minor changes in the production of bricks and, most important, got a tax refund from the taxpayers. His father soon realized that he was dependent on his own son.

In 1864, 20-year-old Heinz was running the brick factory almost single-handedly. He was even able to expand the production while his father went to visit his relatives in Germany. The brickyard began to bring a decent income and Heinz family soon was able to move from a tiny house to a villa built from the bricks produced by their own factory.

 

Starting a Company

Despite the success of the brickyard, Heinz’s true passion was food. He was still interested in the recipes his mother taught him and constantly experimented, trying to improve them. In search of a new business idea, Heinz took a chance on the canned food market.

In 1869, together with a friend and neighbor L. Clarence Noble he launched a company named Heinz & Noble.

Heinz & Noble provided restaurants and cafes with sauerkraut, grated horseradish, pickles and other products. Heinz knew that people did not particularly trust canned products due to the many poisoning cases, so he came up with an idea to test the product. He provided a sample of product to vendors with a fake label. If the product succeeded, he put the Heinz & Noble name on it.

In order to survive in the fierce competition of the time, Heinz & Noble not only had to provide consumers with high-quality products, but they also had to make them more available.

The Heinz house, left empty after the family moved to the villa, was reorganized for production of Heinz & Noble in 1874. Heinz hired several German housewives who washed and canned vegetables. They also purchased an entire crop from local farmers at a fixed price. They purchased horses and vans to deliver the crop in advance and also bought a factory for the production of vinegar in St. Louis, Mo.

The Heinz House

In 1875, there was a record-breaking harvest of cucumber and Heinz & Noble did not have enough working capital to cover their contracts with the farmers. This type of problem was typically solved with a loan, but that same year, the U.S. financial crisis erupted, resulting in the paralysis of entire banking system. The business failed and forced Heinz to declare bankruptcy.

A Second Chance

After reading the malicious headline “Trio in a Pickle” in The Pittsburgh Leader, Clarence Noble broke the partnership.

Heinz took the loss hard emotionally and did not get out of bed for several months. During this time, Heinz’s mother gave him all her savings so he could give his business idea another try.

Despite this setback, Heinz—who had developed a reputation for quality products—was ready to try again.

Heinz used the money wisely and registered the Heinz Food Company on the names of his relatives (mother, cousin and brother John), and continued to produce and sell sauces and pickles.

While Heinz was the head of the company, he was not allowed to manage it by law, as his mother owned most of the shares. The Heinz business became strictly a family business. The relatives even conducted a board meeting in the kitchen during a family dinner.

Ketchup & More…

Did you know that six out of ten ketchup bottles consumed in the United States are produced by Heinz?

Henry’s mother, knew how to make a delicious tomato sauce and this was the recipe which became a formula of the Heinz ketchup.

Tomato sauce made from fresh tomatoes grown by Heinz in the fields of Pennsylvania (so everyone could personally make sure that only the choicest tomatoes are used) was a great success. The ketchup more than delighted consumers, as it could improve the taste of a wide variety of products – from sausages to pasta.

In 1896, while riding a train in New York City, Heinz saw a sign advertising 21 styles of shoes, which he thought was very clever. Although Heinz was manufacturing more than 60 products at the time, Henry thought 57 was his lucky number. Therefore, he began using the slogan “57 Varieties” in all his advertising. Today the company has more than 5,700 products around the world, but still uses the magic number of “57.”

57 Varieties

Henry continued to expand the range of preserves, sauces, and marinades. Ketchup was followed by such products as sauces made of red and green peppers, chili, apple cider and dips, olives, pickled onions and cauliflower, baked beans and pickles.

Repaying old debts

As the business started to grow again, Heinz started to regain confidence. At the time of economic crisis, when Heinz owed a huge amount of money to the Pittsburgh farmers and grocers, he promised that he would repay them all to the last cent. When his income became significant, honest and conscientious Henry gradually started to pay back his debts. It took him five years to cover them all. In 1888, once all his debts were repaid, Heinz became a legal owner of the company, moving its headquarters to Pittsburgh, Pa.

The Glass Bottle is Half Full

Heinz never sacrificed quality in his products. Taking the principles he valued as a teenage entrepreneur, as an adult, Heinz continued to ensure his products were of the highest quality. To do so, he organized various quality-control systems, introduced new technologies, and constantly experimented with packaging.

He believed the way the bottle looked was of utmost importance. He noticed consumers did not trust canned food in opaque jars. Just like his horseradish sales, Heinz decided customers should be able see what the product contains, and started to use glass bottles for his ketchup.

While the package demonstrated a beautiful red color of the sauce to buyers and enhanced the credibility of the manufacturer, there was a con. Ketchup often darkened over time, giving the product an imperfect look. To counteract the darkened color at the top of unopened ketchup bottles, Heinz began to glue labels around the bottleneck.

Heinz also offered factory tours to show the safety and cleanliness of his manufacturing process (the tours also allowed visitors to try his products).

Advertising Heinz

Going back to his now known commitment to quality, Heinz believed consumers had to try the product in order to buy it. To beat that barrier to entry, each Heinz store was supplied with “probes,” or samples of different products. Heinz even invented a special cardboard spoon that could immediately be thrown away after trying a product.

In 1883, Heinz took part in The World’s Columbian Exposition in Chicago. He was given a booth on the third floor of the exhibition hall – not the most convenient space as visitors had no desire to climb to the third floor. In order to entice them, Heinz printed golden foil labels that could be exchanged for a free prize in a booth on the third floor. He spread them all over the convention. People fell for the gimmick. When they got to the top of the stairs to claim their prize, the very first thing they saw was a huge amount of cans and bottles of Heinz products put on a display in the form of a pyramid. Thanks to Heinz’s ingenuity, his products became the highlight of the show.

Treating Employees Right

In the summer of 1892, the employees of Carnegie Steel Company located in Pittsburgh, Pennsylvania went on strike against mass dismissals from work. Ten people were killed during a fight with a security of the factory, and several dozens were injured. To end this conflict, the governor of Pennsylvania introduced military troops to the city.

Shocked by these incidents, Heinz immediately started to improve working conditions within his factories. The workers of Heinz had breaks during a day; they also could take a bath after a working shift. All the women were given fresh aprons and bonnets, the ones who peeled the cucumbers were given a free manicure once a week. Besides, every factory worker had a free medical service guaranteed.

Heinz’s factory had a family atmosphere. It had its own groups of interest, and even a choir, so the work in this team was very prestigious, although Henry established very strict hygiene requirements. No other company producing food could compete with Heinz in sanitation. This applied not only to the factory but also to the cultivation of vegetables and fruit on the fields.

Essentially, Heinz was the first businessman to master the production of organic foods. He never used chemical preservatives in his products. Heinz never considered other manufacturers to be his competitors in terms of quality; his main rivals have always been housewives.

His considerate treatment of employees was also notable for the time; in addition to comfortable working conditions, he directed managers to listen to workers’ concerns. During his time at the company, Heinz’s workers never went on strike.

Personal Life and Legacy

Heinz married Sarah (Sallie) Sloan Young in 1869. Young was a first-generation American whose family was Scotch-Irish. They had four children: three sons – Clarence, Clifford, Howard, and one daughter, Irene.

In 1894, the greatest tragedy of Henry’s life occurred—the death of his dearly beloved wife, Sallie. She died from double pneumonia, leaving a broken husband and bereaved children behind.

Despite his profound loss, Heinz worked tirelessly against a large segment of the processed food industry to gain passage of the Pure Food and Drug Act in 1906. Although many food manufacturers opposed the act, Heinz was a strong proponent. His advocacy for its passage helped increase sales, as customers felt they were able to trust the safety of Heinz’s manufactured foods. It inaugurated the modern food industry and guaranteed purity to all consumers.

Years of hard work and innovation had made Henry John Heinz and his products internationally known and respected. In 1919, in the year of the 50th anniversary of the founding of Heinz & Noble, H. J. Heinz died of pneumonia at his home, Greenlawn, in Pittsburgh. He was 74. He left behind a business with more than 6,500 employees, 25 factories and products that were distributed in countries around the world.

“As I did not become a priest, I have to find another way to do some good to mankind.” – Henry John Heinz


Sources:

H. J. Heinz Biography. (2014). A&E Television Networks. The Biography.com website. Retrieved 19, 2018, from https://www.biography.com/people/hj-heinz-39251.

Henry J. Heinz Biography: Success Story of Heinz Ketchup Empire. (2018). Astrum People website. Retrieved 2:00, Sep 19, 2018, from https://astrumpeople.com/henry-j-heinz-biography/.

Henry John Heinz, American Manufacturer. Encyclopaedia Brittanica, Inc. website. Retrieved 1:30, Sep 19, 2018 from https://www.britannica.com/biography/Henry-John-Heinz.

John Heinz and the Heinz Family: The Heinz Family. John Heinz A Western Pennsylvania Legacy. Retrieved Sep 19, 2018, from http://www.johnheinzlegacy.org/heinz/heinzfamily.html.

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