“Yankee of the Yards: Biography of Gustavus Franklin Swift,” by Louis F. Swift, AW Shaw, Chicago, 1927. This 217-page hardback tells the story of Gustavus Swift, best known as the founder of the Swift & Co meat packing business in Chicago.
Swift was born in 1839 in Cape Cod, MA. He had an early interest in the meat business. He bought chickens from his grandparents and resold them. He butchered a cow and sold the meat from a wagon. He partnered to form a meat packing business in Barnstable, near Boston. He realized that shipping cattle from the west to butcher in the east was inefficient. There were too many middlemen and the animals had to be fed and watered. They lost weight. Only about half of the steer was meat. The rest was waste to be discarded.
In 1875, he decided to move to Chicago to be nearer the cattle including those Texas long horns arriving by rail from the cattle drives. His partner in Barnstable did not want to move. They dissolved their partnership. Swift got $30K to begin his Chicago venture. He planned to butcher cattle in Chicago and ship dressed beef to eastern markets in refrigerated railcars.
In Chicago he had three competitors. Philip D. Armour and Nelson Morris butchered hogs. GH Hammond butchered cattle for the local market. They called Swift a Yankee, and decided to let him fail. It was years before they realized the success of his business and followed suit.
Swift’s first challenge was refrigeration. Traditionally butchering was a wintertime activity to reduce spoilage. Swift used ice cut from lakes to cool his facility allowing processing year round. The book describes his trials with several railcar designs before he found one that worked. He was skilled in every aspect of the business and could buy his own cattle. The first were butchered by Hammond under a tolling agreement. The eastern railroads found the cattle business profitable and refused to co-operate. It was Grand Trunk RR in Canada that agreed to carry his refrigerated railcars. They had no cattle business.
He was hard working, honest, and disciplined in his ways. He was careful to keep his bankers well informed and to pay his debts on time. In a pinch, he borrowed funds from his employees. Once a competitor had an ice house burn. He offered the owner 6% interest for his insurance payment.
The book is loaded with business management methods that are still modern practice. He believed in management by walking around. He would do surprise visits to his facilities. He insisted on clean working spaces believing that meat prepared in clean plants lasted longer. He routinely checked sewers for signs of leaking fat that might be sold profitably. He grilled his managers on details such as the number of windows in their facilities. He constantly worked to develop the skills of his people. He gave raises to those who did well and rewarded them with promotions. His letters to managers ended: “Please answer and say if you will carry out these instructions.” “What have you done for me lately,” became “The best a man ever did shouldn’t be his yardstick for the rest of his life.”
To establish his dressed beef in eastern cities, he shipped a railcar with a sales agent to undercut the prices of local butchers. He accepted, even demanded, losses to get established. His product was perishable and had to be sold–at whatever price required. He partnered with local butchers to distribute his product when possible. Or he would set up a branch house nearby to compete. He was skilled at displaying meat to sell the less popular cuts.
His dressed beef was often sold near cost. Money was made processing the by products into buttons, margarine, peanut butter, etc.
His business grew rapidly. He gradually expanded to sell dressed beef in Europe. He soon added mutton and in 1887 began processing pork. To be closer to cattle he built additional packing plants in Kansas City (1888), Omaha (1890), E. St. Louis (1892), St. Joseph (1896), and the largest in St. Paul, MN (1897). Armour and Morris followed his lead, but they never caught up. He remained the largest slaughterer of beef. The three companies tried to form the National Packing Company in 1902, but it was dissolved under antitrust laws.
The book was written by his son and is clearly worshipful. No doubt Swift had his critics. He died in 1903, before Upton Sinclair published his The Jungle (1906) which told the horrors of meat packing in Chicago. No doubt Swift would deny those horrors happened in his plants. If discovered in his plants they would be immediately corrected.
Wikipedia tells us that Swift is still around. They were acquired by JBS USA Holdings in 2007. Their brands include Butterball turkeys and Peter Pan peanut butter. Their corporate history includes time with ConAgra and Beatrice Foods.
Business persons will like the stories of marketing, management, and especially establishing a new product in a competitive market. Swift was a pioneer. His methods are modern in many ways. Photos. Index.