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Archive for February, 2015

HersheyArchives@30-4 Selling the Lancaster Caramel Company

150 shares of American Caramel Company stock owned by Milton S. Hershey.

150 shares of American Caramel Company stock owned by Milton S. Hershey.


What’s the story behind this American Caramel Company stock certificate?  Milton Hershey’s caramel business was called the Lancaster Caramel Company.  So why did Milton Hershey own stock in a rival company?


The Lancaster Caramel Company dominated the United States confectionery market.  Lancaster Caramel products were distributed nationally and internationally. Even though Lancaster Caramel Company dominated the market, there were competing firms.   The American Caramel Company had been organized in 1898 following the merger of three smaller caramel businesses.  It had offices in Philadelphia and New York and its managers were very aggressive businessmen.


American Caramel felt that Lancaster Caramel was their only serious rival and the owners tried to persuade Milton Hershey to merge with them. American Caramel Company knew that a merger would allow them to control 95 per cent of the caramel market.


However, Milton Hershey was not interested in the idea of the merger. At first, American Caramel threatened to put Milton Hershey out of business, but Hershey was not intimidated.


Finally, the owners of the American Caramel Company approached Milton Hershey with an offer to buy his business. Milton Hershey responded with interest. Though caramels were a very popular confectionery product, Hershey believed that the caramel market was reaching the end of its popularity. “Caramels are just a fad,” he said.


Negotiations to sell the Lancaster Caramel Company stretched on for months. Finally, in Spring, 1900, the price was finally agreed on: Milton Hershey would sell the company for one million dollars.


John Snyder, legal counsel to Milton S. Hershey. ca.1915-1930

John Snyder, legal counsel to Milton S. Hershey. ca.1915-1930


Negotiations were not yet concluded.  The matter of how the price would be paid needed to be resolved.  Milton Hershey’s representative, his lawyer John Snyder, wanted an all cash transaction. Daniel Lafean, the American Caramel Company representative, had other ideas.


Throughout the spring, representatives of the two companies held negotiations.


Our knowledge of the negotiations comes from a 1955 oral history interview with John Myers, who was the stenographer during the talks. John Myers related:


The negotiations took place in Mr. Snyder’s office, 120 East King Street [Lancaster, PA]. There were present Mr. Hershey, and John Snyder; representing the other people was Congressman Lafean of York [PA] and a representative of the Providence Trust Company of Providence, Rhode Island.

                The first offer of the [American Caramel Company] people was $500,000 in cash and an equal amount in stock.  The agreed on price was a million dollars. The price was understood.  I know. I was there. I was the stenographer.

                The second offer was $750,000 in cash and $250,000 in stock.

                The third offer was $900,000 in cash and $100,000 in stock.

                Hershey had left it to Mr. Snyder because he trusted him with anything at all. But when Snyder refused that last offer, Mr. Hershey became quite angry.


Milton Hershey wanted to sell and he felt that $900,000 cash and $100,000 in stock was a good offer. He didn’t want the American Caramel Company to pull out at this point. And he also wanted to keep the good will of Lafean whose company might very well be customers in buying Hershey Chocolate coatings for their caramels. However, he knew that Snyder had set his heart on receiving one million dollars in cash and he wanted somehow to save Snyder’s pride.


So the discussion between Milton Hershey and his lawyer lasted a long time and when it was over Snyder had his way. Lafean’s third offer was refused, and the American Caramel Company agreed to pay cash for the full amount.


150 shares of American Caramel Company stock owned by Milton S. Hershey.  Sold 10/4/1900

150 shares of American Caramel Company stock owned by Milton S. Hershey. Sold 10/4/1900


But although it appeared that Hershey and John Snyder had driven a hard bargain, it was not Hershey’s way to let his opponents feel that they had been taken advantage of. Quietly, he agreed that after the one million dollar check had been handed him, he would spend a large part of it to purchase American Caramel Company stocks and bonds.


The sale of the Lancaster Caramel Company was finally completed on August 10, 1900. Milton Hershey surrendered the factory, the machinery, the stock in hand, his formulas, and the “Crystal A” trademark. He also agreed not to make caramels in Lancaster. But he retained the ownership of the Hershey Chocolate Company and he kept all his chocolate-making machinery. He also rented a wing of the caramel factory from the new owners in which he continued to make chocolate.


On October 10, 1900, Milton Hershey sold 150 shares of his American Caramel Company stock to Weeden & Co.

Reverse side of stock certificate. On October 10, 1900, Milton Hershey sold 150 shares of his American Caramel Company stock to Weeden & Co.


While Milton Hershey agreed to purchase American Caramel Company stock with sale monies, he had no intention of keeping the stock as a long term investment.  He directed John Snyder to sell the American Caramel stock as soon as was prudent.  Just a few months later, the first of Milton Hershey’s American Caramel Company stock was sold.*


*It turned out Milton Hershey was right in his assessment of the future of caramels in the confectionery market.  By the 1920s, the American Caramel Company was faltering and a few years later collapsed in bankruptcy.

HersheyArchives@30-3 “I am going to make chocolate.”


Milton Hershey ordered four pieces of equipment from the J.M. Lehmann Company's New York office. January 11, 1894

Milton Hershey ordered four pieces of equipment from the J.M. Lehmann Company’s New York office. January 11, 1894


Milton Hershey made his fortune with caramels but he made history with chocolate. In 1893, while attending the Columbian Exposition in Chicago, Hershey told Frank Snavely, “Caramels are a fad but chocolate is permanent. I am going to make chocolate.”


Milton Hershey was a reader of newspapers and an astute businessman. The increasing demand for chocolate in the United States would not have escaped his notice. In 1883, the United States imported 9,000,000 pounds of cocoa beans; in 1893, 24,000,000 pounds.


After examining the J. M. Lehmann exhibit of chocolate making machinery at Chicago’s 1893 Columbian Exposition, Hershey made up his mind to invest in chocolate. After the exposition closed, two pieces of Lehmann machinery from the exhibit were shipped to Lancaster, Pennsylvania. This document, an order for additional chocolate making machinery, details Hershey’s subsequent purchases and signifies the beginning of Hershey manufacturing chocolate in 1894.


The principal machines required to manufacture chocolate are roasters, hullers, mills to crush the beans, melangeurs (chocolate grinding machine) to mix the chocolate paste and sugar, cocoa butter presses to separate cocoa butter from cocoa solids, and steel rollers to refine the chocolate. Having acquired the melangeur and steel roller from the exhibit at the exposition, this purchase of equipment fulfilled Hershey’s needs. By 1895, the Hershey Chocolate Company was producing cocoa and semi-sweet or dark chocolate for retail sale.


Catalog; page 4. Image of a J.M. Lehmann Roasting Machine; Roaster; Catalog; J.M. Lehmann Dresden-Loebtau, 1902 edition

Catalog; page 4. Image of a J.M. Lehmann Roasting Machine; Roaster; Catalog; J.M. Lehmann Dresden-Loebtau, 1902 edition


When Hershey decided to make chocolate, he committed to the idea fully. Comparing the invoice found at the top of this story to a slightly newer (1902) J. M. Lehmann catalog indicates Hershey purchased machinery capable of producing large quantities of chocolate. The purchased roaster had a capacity of 9oo pounds. The local newspaper reported that Hershey’s melangeur was the second-largest in the United States, second only to one used by Walter Baker & Company. From the start, Hershey intended to transform and dominate the chocolate market in the United States.

HersheyArchives@30 – 1 Where would we be without family?

This is part of a series celebrating the 30th anniversary of Hershey Community Archives by highlighting 30 items from the collection.


Letter: Milton Hershey to his Uncle Abraham Snavely, 1/13/1882

Letter: Milton Hershey to his Uncle Abraham Snavely, 1/13/1882


While Hershey’s Milk Chocolate is an iconic symbol of the United States, its creator, Milton Hershey, is less well-known.  And even if you know that Milton Hershey built a town and funded a school for disadvantaged children with the profits from that chocolate bar, you may not know that Milton Hershey came by his success the hard way:  he tried and failed and tried again until he achieved success.


It is very easy to overlook or dismiss the years of struggle when someone like Milton Hershey ultimately achieves such tremendous success.  Fortunately, the Archives holds evidence of his struggles and his early failures.  These artifacts help us to better understand Milton Hershey and the events that shaped him.


Milton Hershey's first business card.  ca.1876

Milton Hershey’s first business card. ca.1876


Milton Hershey opened his first confectionery shop in Philadelphia, Pennsylvania in 1876. He was 18 years old. The business got off to a good start, sales buoyed by the crowds who flocked to Philadelphia to visit the Centennial Exposition.


Business grew and a few years later, needing more space, Milton Hershey moved his shop down the street to larger quarters at 925 & 927 Spring Garden Street and operated a wholesale business from 532 Linden Street (just around the corner). But by 1880 the business was beginning to falter.


The Archives holds several  letters from Milton Hershey to his Uncle Abraham Snavely that were written between December 1880 and January 1882.  Each letter is much like the same, pleas for loans of money or requests for patience because Milton Hershey has not repaid the previous loans.  The Archives does not hold any letters from Uncle Abraham.  We can imagine that as Milton Hershey continued to beg for more and more financial support, Abraham became exasperated and disillusioned with his nephew.  Milton’s last letters to his Uncle indicate that Abraham Snavely was dragging his feet (and wallet) about sending any more money.


The last letter in the Archives’ collection suggests just how desperate Milton Hershey had become.


Letter: Milton Hershey to his Uncle Christian Snavely, 1/13/1882

Letter: Milton Hershey to his Uncle Christian Snavely, 1/13/1882




Office of




 Sole Manufacturer of the Celebrated H.H. Cough Drops

 1217 TO 1225 BEACH ST.,


                                                                                                              Philadelphia, Jan 13, 1882

Dear Uncle

You letter of the 12 inst

at hand , and I canot do anny longer than

Tuesday 17th or aunt Martha will have to come

up so do try to save her the trouble as she wishes

to stay a few weeks longer I Paid the note of

wisemans & Mcgill but it made me so short I can

[n]ot Pay my Bills. And Martha would of come up

then but she thought You would do this much for the

last time. So do Possitively send it by

Tuesday 17inst if I would of [if I] not had father

to Pay the 350.00 I would not of had to trouble

You or Martha and she was Perfectly willing

that I got Clear of him and I feel better my-


Your Truly,


Aunt Martha wish to [k]now if you Recd that

Pacye of h?? Tr J.Ohoh at Lancaster


The letter’s reference to having to pay his father reveals another layer to Milton Hershey’s financial struggles. Henry Hershey had arrived to “help” his son in in late 1880. Full of ideas and vision, Henry designed a candy display cabinet (pictured on Milton Hershey’s stationery letterhead) that Henry was certain would benefit his son’s business.


Milton’s mother and his Aunt Mattie were not pleased with Henry Hershey’s involvement with the business. The women viewed him as a distraction and a disruption. They urged Milton to pay his father for the candy cabinet so that his father would leave Philadelphia. Yet Milton didn’t have enough money to invest in another venture.  While he agreed to pay his father, that payment was the final blow to Milton Hershey’s first candy business.


After struggling for six years to make his first business a success, Milton Hershey closed his shop in the spring of 1882. While the end of this business was not a happy conclusion, Milton Hershey learned many lessons about supply and demand, credit, cash flow and the importance of limiting your product line. These were all lessons that he would put to use more profitably in future business ventures.







Archivesat30 headerl


2015 marks the 30th anniversary of the Hershey Community Archives.  It’s a personal anniversary for me as well.  On February 2, 2015, I arrived in Hershey to start my first day of work creating an archives for the corporations and community of Hershey.  I remember feeling pretty overwhelmed by this challenge to start an archives from scratch.  I was young, just a couple years out of graduate school, and with limited experience.


I didn’t know much about the history of this community.  As records were collected, I was also building a knowledge base about Milton Hershey and his sizable legacy.  Because so little had been written about Hershey, much of what I learned about Hershey came from studying the documents I was charged with organizing and preserving.


Today the Hershey Community Archives’ collections occupies over 6,000 cubic feet of shelf space.  Our collections contain business records, packaging samples, photographs, maps, plans, film, various video formats, slides, oral histories and a growing collection of electronic records. It is a rich resource for understanding Milton Hershey and the history of everything he established.


In recognition of the Archives’ 30th anniversary, we will be highlighting 30 items from the collections that help us tell important stories of Hershey’s past.  They’ll be posted throughout the year.


I’ve also spent some time compiling a timeline of the Archives’ history.  The timeline highlights significant moments in the Archives’ growth and evolution.  You can see the timeline here.