Biographies

Henry J. Heinz Biography: Success Story of Heinz Ketchup Empire

Henry J. Heinz Biography

Henry J. Heinz

In this success story, we will share the biography of Henry J. Heinz, the founder of The H. J. Heinz Company. As a rule, many famous American entrepreneurs’ memoirs look alike: they all started from scratch but became millionaires thanks to perseverance and enterprise. Today, it is one of the largest food processing companies. For instance, six out of ten ketchup bottles consumed in the United States were produced by Heinz, while at the same time, the share of ketchup sales is about 30% of the total company sales. However, the company still produces a wide variety of other products.

High performance, ingenuity, and hard work are among the distinctive personality traits of Henry J. Heinz. However, not only did these qualities help him to become a successful entrepreneur, but Henry was also very attentive to the company’s products and employees.

Henry J. Heinz  Parents

The ancestors of Henry Heinz lived in Germany and produced wine. His father, John Henry Heinz, was born in Germany. Thus, it is unsurprising that his father spent his entire childhood in the vineyard. At 19, John Heinz went into military service, and when he returned, he decided to move to the United States of America. Relatives have never learned the actual reasons for his relocation – the Heinz family was not in poverty, so it is illogical to assume that Henry’s father decided to leave the country to get rich. Even though, at those times, it was the main reason for moving to the U.S., only Germans, whose relatives were already living there, dared to migrate. Nobody wanted to go to a foreign country without friends or acquaintances, as it was too risky. Nevertheless, John H. Heinz took that risk.

At the age of 21, John, along with other migrant families, settled in the stronghold of German emigrants in Pittsburgh, Pennsylvania. He decided to build a brickyard and started by opening a small business. This was also where John met his love, a conservative, hardworking, and very religious woman. Her name was Anna Margaret Schmidt. At age 20, she moved to the United States from Hessen, Germany. At the time, German immigrants had traditionally always kept together; even marriages had to be contracted within the community. Anna and John married and gave birth to six wonderful kids – the firstborn was Henry John Heinz.

Childhood

Henry John Heinz was born on October 11, 1844. The boy grew up surrounded by a hardworking family and started gaining experience in horticulture at a very young age. Mother always spoke to Henry in German, and he learned German pedantry, which remained one of his critical qualities throughout life. When the boy turned six years old, he started to help around the house and garden. At the age of nine, Henry nailed the recipes of pickles and started selling homemade grated horseradish in downtown Pittsburgh. Even though many of his peers worked as hard as Henry, he realized it could also be an excellent way to build a career. Child labor to provide financial assistance to their parents was common then.

When Henry turned 10, his parents granted him 3,000 square meters of land; at 12, he owned 12,000 square meters of land, perfect for growing vegetables. Gardening became the boy’s passion – spending hours and days in the garden, sparing no effort.

Sometime later, he started driving his crop to the local greengrocer, who was selling vegetables and fruits to the residents of Pittsburgh. However, gradually, with German thoroughness, Henry expanded his own business. Soon, one could buy Heinz’s grated horseradish at the grocery. Its taste was familiar to many locals, as Henry had always used his mother’s recipes.

At the time of Henry J. Heinz’s childhood, fooling the customers was a regular part of any business in the U.S. One of the local newspapers wrote, “In so-called horseradish, we can find more turnips and water-soaked wood sticks than the horseradish itself.” Therefore, to show the excellent quality of his product, Henry packed it in clear glass jars. Such transparency and the high quality of the product made a good impression on the customers, thus increasing the popularity of the grated horseradish Heinz offered.

When Henry J. Heinz graduated from high school, his garden had grown so much that he had to hire workers. In 1861, when Henry was just 17 years old, he earned a decent amount of money for those days – $2,400 (if translated into today’s money, you would get something around $43,000).

Henry’s mother, Anna Margaret Schmidt, always cheered and supported him in the case of failure; she knew how to comfort her son and instill confidence in him. She taught Henry communication skills. In addition, Anna Margaret Schmidt, a very religious woman, sincerely hoped her son would become a priest. She even brought him to the neighborhood Lutheran school. However, Henry was not interested in spiritual practice because he felt the compulsion to the figures and tables. This is why he left the Lutheran school and went through business training at one of the top financial colleges in America, Duff’s Mercantile College. Henry J. Heinz financed his education independently, using the money collected from selling the vegetables from his garden. In college, Heinz learned how to keep records and accounting books. Later, he regularly took notes and led a strict accounting of the income and expenses of his business.

After graduating from Duff’s Mercantile College, Henry worked at his father’s brickyard. He learned all the intricacies of this business, made some minor changes in the production of bricks, and, most importantly, got a tax refund from the taxpayers. Suddenly, the father realized he depended on his son, who became an indispensable employee. Henry took care of all accounting paperwork with great enthusiasm, as his father, in his essence, was an artisan rather than a businessperson. Thus, in 1864, 20-year-old Henry was running a brick factory almost single-handed. Subsequently, he was even able to expand the production while his father went to visit his relatives in Germany.

Meanwhile, the brickyard began to bring a decent income, and the Heinz family soon moved from a tiny house to a villa built from the bricks produced by their factory.

Heinz & Noble

As an adult, Henry J. Heinz was still interested in his mother’s recipes, constantly experimenting and trying to improve them. Heinz was always searching for new business ideas; this time, he decided that the canned food market was worth trying. In 1869, together with a friend and neighbor, L. Clarence Noble, he launched a company named Heinz & Noble. It provided restaurants and cafes with sauerkraut, grated horseradish, pickles, and other products. Henry knew that people did not particularly trust canned products due to the rapid poisoning cases, so he decided not to put the name of his company on the labels. First, he always sent a product sample with a fake title, and only then, if it succeeded, put his brand name on it.

The sale of prepackaged products was the right choice at that time. The steel-casting industry was well developed in Pittsburg, and most men worked 12 hours a day, thus having no time for cooking. They preferred to buy food that was ready for immediate consumption. Over 60 companies picked up this tendency and began supplying the market with various preserved products.

In the same year, 1869, he married Sarah Sloan Young. She was a first-generation American whose family was Scotch-Irish in the Methodist church he was attending. They fell in love and married after getting Henry’s mother’s blessing. Later, Henry J. and Sarah Heinz had four children: three sons – Clarence, Clifford, Howard, and daughter Irene.

The company’s revenue reached a few thousand dollars in its founding year. To survive the fierce competition, it was necessary to provide consumers with high-quality products and make them more available. How could this goal be achieved? First, the production must be massive. Therefore, the Heinz house, which was left empty after the family had moved to the villa, was reorganized to produce Heinz & Noble in 1874. Henry hired several German homemakers who were engaged in washing and canning vegetables. Secondly, during the springtime, they agreed to purchase the whole crop from the local farmers at a fixed price. In this way, they also saved much money since during adverse weather conditions in summer or autumn, the cost of vegetables could increase significantly. In addition, Heinz & Noble purchased horses and vans to deliver the crop in advance; they also bought a factory to produce vinegar in St. Louis, Missouri. The company succeeded, and Henry became a wealthy entrepreneur who could easily support his family.

Things were going well, and young partners expected to have a considerable profit, but then something they could not predict happened – the harvest of cucumber broke all record numbers that year, so their company did not have enough working capital to cover the contracts with the farmers. Sure thing, they could get a loan in a bank, but in 1875, the U.S. financial crisis erupted, resulting in the entire banking system being paralyzed. Farmers applied to the court, resulting in Heinz & Noble finding its place among the 5,000 bankrupt enterprises. All the property had to be sold to compensate for the farmers’ losses. Besides, The Pittsburgh Leader newspaper made fun of their business.

The Collapse of the Company and Its New Breakthrough

After reading the malicious headline “Trio in a Pickle” in The Pittsburgh Leader, Clarence Noble said he did not want to hear anything about any private business in general. As well as his business partner, Henry has experienced severe emotional stress, and it took him a long time to recover. Christmas of 1875 was the worst in his life, as he could not afford to buy gifts for his children. Heinz has long remained depressed; he did not get out of bed for several months. At this challenging time, his kind and wise mother, who always knew how to support her son and instill confidence into his heart, helped her beloved offspring return to life. She gave Henry all her savings so that he could give his business idea a second try.

Inspired, Henry used the money wisely and registered Heinz Food Company to the names of his relatives (mother, cousin, and brother John), continuing to produce and sell sauces and pickles. He was the head of the company, although he was not allowed to manage it by the law, as his mother owned most of the shares. The Heinz business became a family business. The relatives even conducted a board meeting in the kitchen during a family dinner. Henry walked on foot to his fields daily to check how things were going. Only sometime after, when he had saved a little money, was Henry J. Heinz able to buy a horse, which was affordable because of its blindness.

The National American Sauce

The situation of a 31-year-old businessman was not an easy one. He had to start not from scratch but with reimbursement of his debts. Henry John Heinz worked hard, canning the jars to pay off all the liabilities. “I am wearing brain and body out,” he wrote in his diary titled “Panic Times.”

Henry tried hard to mark the point where he had made a mistake. Thinking about it, Henry J. Heinz decided that the critical error occurred in growing vegetables. He concluded that The Heinz Food Company should have its land to control an entire production cycle, starting with the growing of seedlings and ending with the delivery of canned vegetables into the trading network. This was the only way to ensure the product’s quality and reduce the risk of failure caused by weather conditions or economic crises. However, a business based on the principles of the natural economy would still fail in terms of the cost of production compared to specialized enterprises. Therefore, he needed to focus on quality.

From Henry J. Heinz’s biography, we learned that initially, Henry tried to make mustard, but in early 1876, he mastered the production of tomato sauce, which was later called ketchup. Nowadays, a widespread legend says that the Chinese condiment “ke-tsiap” (brine or sauce with canned fish) was a prototype of ketchup, which Heinz introduced to the world with minor changes. The reality was different, as tomato paste was already on the market. The customers avoided tomato paste, but not because they did not trust the quality of tomatoes (when tomatoes were considered poisonous, it had already passed). That is because of how, in 1776, a Loyalist cook tried to poison George Washington with a dish made of tomatoes, which every American knew, as they learned about it only in 1820.

By 1880, the design of Heinz’s ketchup bottle had started to take its original shape.

Tomatoes were not considered poisonous anymore, but this applies only to fresh fruit. Unripe and rotten tomatoes, which were used for tomato paste production, were still regarded as poisonous. Later, it turned out that this was the truth, as such tomatoes contained a potent poison called solanine. At the same time, tomato sauce was widespread in Europe. The German botanical dictionary, published in 1811, stated, “Even though tomatoes are considered poisonous, they are used for the production of sour sauce in Portugal and Bohemia.” Henry’s mother, who came from Bohemia, knew how to make a delicious tomato sauce, and this was the recipe that became a formula of the most popular ketchup brand nowadays.

Tomato sauce made from fresh tomatoes that Heinz grew in Pennsylvania fields (so everyone could personally make sure that only the freshest tomatoes were used) was a great success. The ketchup more than delighted consumers, as it could improve the taste of various products, from sausages to pasta.

It is interesting to know that in 1896 while riding a train in New York City, Henry J. Heinz saw an advertising sign that promoted 21 styles of shoes, which he thought was very clever. Although Heinz was manufacturing more than 60 products then, Henry thought 57 was his lucky number. Therefore, he began using the slogan “57 Varieties” in all his advertising campaigns. Today, the company has more than 5,700 products worldwide but still uses the magic number of “57.”

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.

Henry started to regain confidence after suffering from bankruptcy. When Heinz owed a considerable amount of money to the Pittsburgh farmers and grocers during the economic crisis, he promised to return them all to the last century. However, bankrupts didn’t have to do so. When his revenue increased significantly, honest and conscientious Henry gradually started to pay back his debts, and it took him five years to clear them all. Only after this did Henry Heinz become a legal owner of the company, moving its headquarters to Pittsburgh, Pennsylvania, United States.

Quality of Production and Motivation of Employees

Henry tried to make the quality of his products as high as possible. To do so, he organized various systems controlling the quality, introduced new technologies, and continuously experimented with packaging. Henry J. Heinz believed the way the bottle appeared was the most crucial part of the product’s image. He noticed that the consumers did not trust canned food in opaque jars. Henry decided the customer should see what the product contained and started using glass bottles for his ketchup. This package had its pros and cons. Of course, it demonstrated the beautiful red color of the sauce to the buyers and enhanced the manufacturer’s credibility. However, ketchup often darkens over time, giving the product an imperfect look. Resourceful Heinz figured out how to eliminate this drawback and glued labels around the bottleneck.

Over time, the company expanded its size and increased its headcount, which created a new problem. In the summer of 1892, the employees of Carnegie Steel Company, located in Pittsburgh, Pennsylvania, went on strike against mass employee dismissal. Ten people were killed during a fight with the factory’s security, and several dozens were injured. To end this conflict, the governor of Pennsylvania introduced military troops to the city.

Henry J. Heinz was shocked by this case, so he immediately started improving his factories’ working conditions. The workers of Heinz had a few breaks during the day; they also could take a bath after a working shift. All the women were given fresh aprons and bonnets; those who peeled the cucumbers were given a free manicure once a week. Besides, every factory worker had a guaranteed free medical service. Henry J. Heinz was committed to his employees’ comfortable working conditions and welfare. Therefore, in the early 1900s, he provided them many amenities and services, such as a library, lecture hall, roof garden, art gallery, and lunchrooms.

Heinz’s factory had a family atmosphere. It had groups of interest and even a choir, so the work in this team was very prestigious, although Henry established stringent hygiene requirements. No other company producing food could compete with Heinz in sanitation. This applied not only to the factory but also to cultivating vegetables and fruit in the fields. Mainly, Henry John Heinz was the first businessman to master the production of organic foods. Moreover, Heinz never used chemical preservatives in his products. Also, he never considered other manufacturers his competitors regarding quality; his main rivals have always been ordinary housewives.

Advertising the Heinz Products

Henry J.  Heinz steadily moved around the country, promoting the company’s products on the trains. He sincerely believed the consumer must try the product to buy it. Each Heinz store was supplied with “probes” – samples of products. Moreover, he invented a special cardboard spoon that could immediately be thrown away after trying a product. Henry could make several trips from Pittsburgh to New York daily, calling the traveling “a school of life.” He always made notes on his observations along the way.

In 1983, Heinz took part in The World’s Columbian Exposition in Chicago. He was given a booth on the third floor of the exhibition hall. The place was not the most convenient – visitors did not want to climb to the third floor. To entice them, Henry came up with the following: he printed golden foil labels, the sign on which stated that this label could be exchanged for a free prize in a booth on the third floor, and spread them all over the place so that they caught the eye of the visitors. People fell for the trick, so they walked up the stairs wanting to get a present. There, the very first thing they saw was a considerable amount of cans and bottles of Heinz products put on a display in the form of a pyramid. Henry’s ingenuity has made his creations the program’s highlight.

Neon advertising appeared in the United States at the beginning of the 20th century. Henry J. Heinz was the first company to acquire neon advertising nationwide.

Tomato Empire

The business methods used by Heinz were giving excellent results, and of course, his rivals started to use them as well. Henry had to take some extreme measures. For example, Heinz bought all the empty jars made of glass in town and used a significant part of them for his production. The rest were loaded on a barge and drowned in the river so no one could use them.

The H. J. Heinz Company became a family business since many of Henry’s relatives worked there. He gradually taught his sons, and then they all started working in his company (initially, they began in sales and then moved to management). Even though Heinz treated his subordinates politely, he could easily take all the necessary measures if he saw that someone did not perform well. Once, he even had to fire his brother John when the results of its operations significantly deteriorated (he was constantly late and worked very slowly). For the sake of the company and its future prosperity, he had to make difficult decisions of this type. Any of his relatives were obliged to perform as well as any of the other company workers, and the fact that he was a member of the Heinz family was never taken into account.

In the winter of 1886, Henry J. Heinz agreed to go to Europe as his family requested. Arriving in London, Heinz immediately went to the procurement manager of the Fortnum & Mason department store, the supplier of The British Royal Household, and demonstrated the samples of his products. “I believe, Mr. Heinz, we’ll buy all of this,” the manager said. Thus, England became the first foreign market to sell the Heinz brand. After ten years, sales have grown to the level that forced Heinz to open an office in London not far from the Tower of London. Following this, he built a factory and bought a large plot of land there, which caused many Englishmen to believe Heinz was a British company.

From that moment, Heinz products came into international trade, which was significant as, in those days, American products were not widespread in Europe. The H. J. Heinz Company history and Henry John Heinz’s biography will be studied as a great example of a successful business.

Sarah Heinz House

In 1898, Henry left the United States to visit his ancestors in Germany. He went on a trip with his wife, Sarah Sloan Young Heinz, who had hoped to see a European doctor to eliminate the chest pains. Since then, Heinz has begun to visit his ethnic homeland every year. Henry J. Heinz’s job obliged him to travel around the world regularly, but he always spent his holidays in Germany.

Soon, the Heinz family returned to the United States. Sarah’s condition did not improve after the journey – her chest pain only intensified. Henry’s wife started to fade gradually, and soon, at the age of 51, she passed away. After the death of his wife, Henry built a Sarah Heinz House in her memory. Today, it is a youth center (it hosts a wide variety of entertainment and sports events). Henry never married again.

The First World War and Lucky Escape from Germany

Each year, Henry J. Heinz vacationed at the fashionable resort “Bad Kissingen” in his native Germany. However, once he arrived there in the summer of 1914, Heinz did not have a chance to relax. Suddenly, he was forbidden to leave his hotel room, as he was a citizen of the U.S. Later, it turned out that thousands of German soldiers were mobilized in the Bad Kissingen area those days. The First World War has just started. Henry barely escaped from Germany through Holland and never had a chance to go back. He even spoke up in favor of the Americans to take part in the war against the German Reich.

World War I caused many changes in the German communities of America. German newspapers went out of print in 1917, and German classes were reduced in schools, and it was even forbidden to speak German. This was a disaster for many immigrants who did not know English. In 1920, the situation slightly improved; however, it was never restored. Heinz’s family stopped speaking German and cut all the connections with Germany.

In his 70s, Henry did not even think to stop working. He still visited the factory regularly, watching the progress of his business. His grandchildren became his true happiness – he had eleven of them. They all loved to travel the world with Grandpa Henry. Journeys have always been his passion. He even opened a Heinz Pier in Atlantic City, New Jersey (being at a young age) to demonstrate Heinz food products and where he kept all the treasures of art and souvenirs brought from his trips. Henry John Heinz loved watches and canes in some unique way – a considerable amount of them were stored in the exhibition hall. Additionally, the Heinz Pier provided demonstration kitchens with free cold and hot food samples. The pier was incidentally destroyed by a massive hurricane in 1944.

Death

Henry J. Heinz suffered and died from pneumonia on May 14, 1919, in Pittsburgh, Pennsylvania, United States. He was 74. His employees raised money and put up a monument, which can still be found in the company’s main building. Before dying, Henry asked to build a church in honor of his mother. Today, this church is located on the campus of Pittsburgh.

The Heritage of Henry J. Heinz

After the death of Henry J. Heinz, his son Howard Heinz took over the management of the business. In his work, he continued to follow the main principle of the father: the company must implement an entire production cycle from its start to its finish. This allowed the company of Heinz to not only survive the Great Depression but also to master the production of baby food and instant soups, which were in high demand during that rough time. The H. J. Heinz Company’s sales and imperial power grew daily. Howard Heinz was a competent manager who could anticipate the market’s demands.

In 1941, H. J. “Jack” Heinz II, the grandson of its founder, headed the company. He earned tremendous money by supplying the army with Heinz products. Still, at the same time, he managed a broad expansion of their family business by building factories worldwide, including Portugal, Mexico, the Netherlands, Italy, and other countries.

Unfortunately, most of the new plants used purchased crops, so H. J. Heinz Company could not exclude, for instance, that they no longer use herbicides to cultivate their vegetables or fruit. This immediately became an advantage for the competitors.

Notably, Henry John Heinz was the last representative of the family who headed the company. A hired manager became the CEO of the Heinz business, even though, of course, the Heinz family still had some influence since it was the largest shareholder. In February 2013, Berkshire Hathaway bought the company for $28 billion (belongs to Warren Buffett), together with its partner – 3G Capital (belonging to Brazilian billionaire Jorge Paulo Lemann). This deal became the largest one in the history of food brands.

In 2012, about 32,000 employees worked at Heinz factories worldwide. The company’s revenue was about $11.64 billion in 2012. Heinz ketchup is present in almost every second refrigerator on the planet. The current CEO of H. J. Heinz Company is Bernardo Vieira Hees, and he was assigned to this position on June 10, 2013.

The Kraft Foods Group Inc. announced on March 25, 2015, that it would merge with the H. J. Heinz Company, owned by 3G Capital and Berkshire Hathaway Inc. This merger formed the world’s fifth-largest food and beverage company, The Kraft Heinz Company (KHC). The two companies completed the merger on July 2, 2015. Berkshire Hathaway owns 26.5%) and 3G Capital owns 7.9%.

Henry John Heinz once said, “As I did not become a priest, I have to find another way to do some good to mankind.” Today, we can say that he achieved this life goal. We hope you have enjoyed reading Henry J. Heinz’s biography and the incredible success story of the H. J. Heinz Company.

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