By Mark Rhoads
At age 29 in 1903, James Kraft, the founder of Kraft Foods, found himself stranded in Chicago with $65 in his pocket. The Canadian-born businessman had come to Chicago to check on a branch of a Buffalo, New York cheese company that he worked for. But while he was in Chicago his colleagues dissolved their partnership with him.
Kraft invested his $65 in a horse named "Paddy" and a wagon and started a new food distribution business. Everyday he bought cheeses from warehouses on South Water Street. He knew how perishable cheese was and he wanted to resell fresh cheese to small grocery stores as fast as he could as early in the day as possible. The service was valuable to merchants who did not have the time to make the trip themselves and Kraft the man and his company soon prospered. Just six years later in 1909 his brothers John, Charles, Fred, and Norman were all working for James Kraft as president of a new company called JL Kraft Bros Co.
Mr. Kraft's investment of $65 in Paddy the horse and a wagon grew over the years. At present, Kraft Foods is the second-largest food and beverage company in the world with net revenues of $34 billion and more than 94,000 employees in 70 countries. The company headqarters is still based in Illinois with offices in Northfield.
James Lewis Kraft was born in 1874 on a farm in Ontario as the second of 11 children who were brought up with the religious teachings of Mennonite parents. At the age of 18, he took a job at Ferguson's grocery store in Fort Erie, Ontario and later invested in the cheese company in Buffalo, New York. It was the Buffalo partners that sent him to Chicago before parting company with him.
By 1909, Kraft was looking for certain qualities in cheese to give it a longer shelf life at the retail store and a more uniform flavor. According to a Kraft Foods history site in Australia, "Until that time cheddar cheese, which was the most widely sold variety in the United States, either moulded or dried quickly so there was excessive waste. It also varied greatly in taste, much of it having a strong or bitter flavour that was unpalatable."
"From the small beginnings of selling a few standard varieties of cheese wholesale, the company was distributing within a few years some 30 varieties of cheese packaged under the brand names of Kraft and Elkhorn, and by 1914 the cheeses were available in most towns across the United States. The company also began to manufacture its own products, including new and traditional varieties of cheese. Most of its new cheeses were packaged in glass jars or in foil-wrapped packages."
As a result of constant experimentation throughout the years to give cheese longer lasting qualities, James Kraft's major contribution to the cheese industry was processed cheese. His work resulted in a good and nutritious food product that could be packaged without waste, with uniform quality, and could still be sold in convenient sizes.
By 1915, Kraft sold $5,000 worth of pasteurised cheese in tins for export to India and Asia. The next year sales went up to $150,000. According to Kraft Foods Australia, the new processed cheese product was ideal for shipment over long distances. The US Government ordered more than 6 million pounds of Kraft cheese in small tin cans to feed soldiers during World War I.
A patent for what became known as processed cheese was granted to Kraft in 1916. The Phenix Cheese Company, famous for Philadelphia cream cheese, had been working on a similar process to produce and package Swiss cheese but did not file its patent in time. But in 1921, James Kraft agreed to share the patent rights and in 1928 the two companies were united as the Kraft-Phenix Cheese Corporation.
"The rapid growth of the company prompted Kraft to extend its production into other areas of the United States. Later the company had cheese production facilities in 23 states and the production efforts of farmers' cooperatives in others. After the processed cheese was launched on a national scale, Kraft added to its line the mass production of such specialty cheeses such as Edam, Gouda and blue cheese."
"In 1920, Kraft purchased MacLaren's Imperial Cheese Co Ltd and began selling processed cheese in tins and loaves in Canada on a national scale. The Canadian company was used to export Kraft products to Europe until operations were established in England and Germany. James Kraft and Fred Walker met in August 1925, and in 1926 the Kraft Walker Cheese Company in Australia was formed."
From its earliest Chicago days, the rapid and continued growth of what was to become the world's second largest food company was brought about by its new product development and the use of innovative advertising methods. James Kraft was an early user of all communications media and, as early as 1911, was advertising on Chicago elevated trains, using outdoor billboards and mailing circulars to retail grocers. He was among the first to advertise in consumer journals and to use coloured advertisements in national magazines. It was not common in the early 1900s for products such as cheese to be sold direct to the consumer under a brand name but Kraft borrowed from the success of that idea and practiced by another Chicago businessman, Oscar Mayer, who sold meats under his own name.
In 1933, Kraft started to use radio on an extensive scale. The company sponsored the one-hour weekly musical and variety show 'Kraft Musical Review', which headlined notable show business personalities. New products such as Miracle Whip salad dressing (1933), Kraft macaroni and cheese dinner (1936), and Parkay margarine (1937) were introduced through the 'Kraft Music Hall' and became immediate favorites. During those years the company also added to its line Kraft caramels, marshmallows, and jams and jellies.
"While in his seventies, James Kraft helped create one of the first major television programs, the 'Kraft Television Theatre', which was said to have set audience and studio production records. The show ran from 1947 until 1958."
After 50 years in business in Illinois, James Kraft died in Chicago in 1953, survived by his wife Pauline and daughter Edith. Like Oscar Mayer Meat Company, and Post Cereals that began in Springfield, Kraft Foods today is part of a conglomerate of food companies under the Illinois-based Altria companies.
