Information about Hormel Foods Corporation

Hormel Foods Corporation
	Public (NYSE: HRL)
Founded	1891
Headquarters	Austin, Minnesota
Industry	Foods
Products	Deli meat, Ethnic foods, Pantry foods, Spam
Revenue	$5.41 billion USD (2006)
Website	www.hormel.com

Hormel Foods Corporation (NYSE: HRL) is a food company based in southeastern Minnesota (Mower County), perhaps best known as the producer of Spam luncheon meat. The company was founded as George A. Hormel & Company in Austin, Minnesota, U.S., by George A. Hormel in 1891. The company changed its name to Hormel Foods Corporation 102 years later in 1993. Hormel sells food under the Jennie-O, Dinty Moore, Stagg, and Carapelli brands, as well as under its own name. The company stock is a component of the Standard and Poor's 500 index.

History

19th century

George A. Hormel (born 1860 in Buffalo, New York) worked in a Chicago slaughterhouse before becoming a traveling wool and hide buyer. His travels took him to Austin and he decided to settle there, borrow $500, and open a meat business. Hormel handled the production side of the business and his partner, Albert Friedrich, handled the retail side. The two dissolved their partnership in 1891 so that Hormel could start a complete meat packing operation on his own. He opened George A. Hormel & Co. in the northeast part of Austin in an old creamery building on the Cedar River. To make ends meet in those early days, Hormel continued to trade in hides, eggs, wool, and poultry. Joining George in November of 1891 was his youngest brother, Benjamin, age 14. By the end of 1891 Hormel employed six men and had slaughtered and sold 610 head of livestock. By 1893, the increased use of refrigerator cars had allowed many large meat packers to force smaller business under. Two additional Hormel brothers, Herman and John, joined the business that same year and together they processed 1,532 hogs, enough to stay in business. The remaining members of the Hormel family moved to Austin in 1895 and joined the growing business. George turned to full-time management in 1899 and turned his focus on increasing production.

1900s

In 1901, the plant was expanded and the business was incorporated. The first directors were A.L. Eberhart and the four Hormel brothers: George, Herman, John and Ben. In 1903 George decided to add a three-story hog-kill, a two-story beef-kill, an annex, an engine room, a machine shop and a casing production department. The name Dairy Brand was registered with the U.S. Patent Office in 1903. In the first decade of the 20th century distribution centers were opened in St. Paul, Minneapolis, Duluth, San Antonio, Dallas, Chicago, Atlanta, and Birmingham. George Hormel visited England in 1905 and started exporting products soon after.

1910s

By 1910, Hormel products were routinely appearing in national magazines. That same year the company developed a procedure to recycle its waste water by daily evaporating up to 9,000 gallons of water, leaving a syrupy liquid which was dried to produce a commercial fertilizer. In 1915 Hormel began selling dry sausages under the names of Cedar Cervelat, Holsteiner and Noxall Salami. That same year Hormel bought Alderson's Mill and began selling Hormel Peerless Minnesota flour nationwide. Hormel joined the World War I effort, George's son Jay C. went into military service and by the end of the war, exports accounted for 33% of the company's yearly volume.

1920s

In 1921, when Jay Hormel returned from service in WWI, he uncovered that assistant controller Cy Thomson had embezzled $1,187,000 from the company over the previous ten years. The embezzlement scandal provided George Hormel with additional incentive to fortify his company. He did so by arranging for more reliable capital management, by dismissing unproductive employees, and by continuing to develop new products. In 1926, the company introduced Hormel Flavor-Sealed Ham, America's first canned ham and it added chicken to its line in 1928. Jay C. Hormel became company president in 1929 and that same year the plant was expanded again to include eight new structures and the main office was tripled in size. In the late-1920s and early-1930s sales branches opened up in Houston, Beaumont, Chattanooga, New Orleans, Baton Rouge, Newark, Los Angeles, Vicksburg, and Nuevo Laredo (Mexico).

1930s

In 1931, Jay C. instituted the Annual Wage Plan: under this plan, employees were paid weekly and they were guaranteed 52 weeks' notice before termination of employment. He also introduced incentive pay, profit sharing and pension plans to the company. Later that year a slaughtering plant was constructed in Mitchell, South Dakota and in 1933, a cattle slaughtering plant was finished in Austin. Dinty Moore beef stew was introduced in 1935 and Hormel Chili and Spam soon followed in 1936 and 1937 respectively. In 1938, Jay C. Hormel introduced the "Joint Savings Plan" which allowed employees to share in the proceeds of the company. By the late-1930s, full-page, four color ads were routinely appearing in the Saturday Evening Post, Ladies Home Journal and Woman's Home Companion. Hormel ads also were featured on the radio program The George Burns and Gracie Allen Show.

The 1930s also saw the establishment of the Hormel & Co. refrigerator car line, with an initial roster of 125 units.

1940s

After reaching sales of $75 million in 1941, George and Jay established The Hormel Foundation to provide perpetual independence of the company, act as trustees of the family trusts and to start and fund the Hormel Institute, a research unit at the University of Minnesota. Hormel's production increased to aid in World War II and 65% of its products were purchased by the U.S. Government by 1945. Founder George A. Hormel died in 1946 in California where he had lived in retirement. He is buried in Austin's Oakwood Cemetery. Jay C. then became chairman of the board, H.H. Corey became president, and R.F. Gray became vice-president. Hormel acquired the Fremont Packing Company in 1947.

1950s

In 1953, it acquired the Tobin Packing Company of Fort Dodge. Also in 1953, distribution centers were opened in San Francisco, Seattle and Beaumont and the company's first non-continental plant opened in Honolulu. Jay C. Hormel died on August 30, 1954, and Corey was named chairman of the board and R.F. Gray was elected president the following year. During Gray's tenure as president the company greatly expanded its international business through arrangements with companies in Ireland, England, Canada and Venezuela. In 1959, Hormel was the first meatpacker to receive the Seal of Approval of the American Humane Society for its practice of anesthetizing animals before slaughter.

1960s

Little Sizzlers sausages were introduced in 1961 and Cure 81 hams were introduced in 1963. In 1962, Hormel constructed a 75,000 square foot sausage manufacturing building in Austin and discontinued the slaughter of calves and lambs. Also in 1963, Hormel acquired the Queen City Packing Company plant in Springfield, Missouri and the Ottawa Meat Packing Company plant in Miami, Oklahoma. New plants were also constructed in Chattanooga and Los Angeles and the plants in Charlotte, Winston-Salem, Fresno and Houston were remodeled or expanded. In 1964, the Hormel Corporate Offices were opened just to the north of Interstate 90 in Austin. Gray replaced Corey as chairman of the board upon the latter's retirement in 1965, and M.B Thompson became president. During Thompson tenure (1965-1969) a dry sausage plant was built in Algona and distribution centers were built in San Antonio, New Orleans and Atlanta. In 1967, the Hormel Foundation, in cooperation with the National Merit Scholarship Program, started a college scholarship program for the children of Hormel employees. Partial scholarships were awarded through this program on the basis of the student's test scores, academic records, financial need, and school and community involvement. A separate building to house the growing research and development department was built northwest of the corporate office in Austin in 1968. In 1969, Gray resigned from the company and Thompson replaced him as chairman (by this time the chairman was called the CEO) and I.J. Holton was named president. That same year, a distribution center was opened in Atlanta.

1970s

In 1970, a distribution plant was built in Albany, Georgia and a dry sausage plant was built in Algona. In 1972, Holton became CEO. In 1971, meat processing facilities and distribution centers were opened in both Dallas and Seattle. That same year the company introduced its Matching Gifts program in which it offered to match the donation (up to $2,000) made by any employee to any accredited college or university. In 1972, distribution centers were opened in Orlando and Shreveport and a food service facility was built in Oklahoma City. A grocery products plant was opened in Beloit in 1973. On this site the city now boasts the worlds largest can of chili. A frozen foods plant was opened in Fort Worth in 1974. A distribution plant was opened in Houston in 1975. In 1976, a slaughtering and processing plant was opened in Ottumwa, a dry sausage plant was opened in Knoxville, Iowa and a grocery products canning facility was acquired in Stockton. A distribution plant was built in Fresno in 1978. A gelatin plant was opened in Davenport in 1979. That same year Richard Knowlton was elected as president, the first Austinian to hold that post since Jay C. Hormel.

1980s

Holton continued as CEO until 1981 and then this duty was also passed to Knowlton. The construction of the current Austin plant began in 1980, and the Knoxville and Ottumwa plants were expanded. The plants in Beloit, Los Angeles and Ottumwa were renovated and expanded. The new Austin plant opened in 1982. Knowlton also became chairman of the board in 1984, while continuing to hold the titles of president and chairman of the board.

1985 strike

In August 1985, Hormel workers went on strike at the Hormel headquarters in Austin, Minnesota. Frustrated by low wages and dangerous working conditions, they started one of the longest strikes of the 1980s. The strike began with the sanction of the International level of the union, P-9. The local chapter of the United Food and Commercial Workers Union P-9 led the strike, but was not supported by their parent union. The strike gained national attention, and led to a widely publicized boycott of Hormel products...

After six months, a significant number of replacement workers crossed the picket line, provoking riots in Austin. Wayne P. Goodnature was Sheriff at the time. On January 21, 1986, the Governor of Minnesota, Rudy Perpich, called in the National Guard to protect the replacement workers (derisively called scabs). This unpopular move brought protests against the governor, and Perpich soon withdrew the National Guard from Austin. The action had a greater effect on the national union, which ousted the local P-9.

The strike was ended in June 1986, after lasting 10 months. Over 700 of the workers did not return to their jobs, refusing to cross the picket line, as some had chosen to do. In solidarity with those workers, the boycott of Hormel products continued for some time. Ultimately, however, the company did succeed in hiring new workers at lower wages. It is still disputed as to who actually made the original National Guard request.

The strike was chronicled in the film "American Dream", which won the Academy Award for best documentary in 1990. A song about the strike, entitled "P-9", was written by Dave Pirner of the Minneapolis band, Soul Asylum. The song can be found on their 1989 album, Clam Dip & Other Delights.

See also

• Gustavus Franklin Swift
• Philip Danforth Armour

References

• Cooper, Jake. Lessons of the P-9 Strike. Socialist Action Books. 298 Valencia St., San Francisco CA 94103.
• Mill on the Willow: A History of Mower County, Minnesota by various authors. Library of Congress No. 84-062356
• White, John H. (1986) The Great Yellow Fleet. Golden West Books, San Marino, California. ISBN 0-87095-091-6
• http://money.cnn.com/magazines/fortune/fortune500/snapshots/635.html

External links

• Hormel Foods Corporation official website
• Minnesota Public Radio 2003 interview with two former Hormel strikers.
• Nutrition facts
• Hormel Historic Home Home of George A. and Lillian Hormel in Austin, Minnesota
• Slaughterhouse Fight: A Look at the Hormel Strike

•  • [ e] Major Private Refrigerator Car Lines of the United States

American Refrigerator Transit Co. Armour Refrigerator Line Burlington Refrigerator Express Fruit Growers Express General American Transportation Corporation Hormel and Co. Merchants Despatch North Western Refrigerator Line Pacific Fruit Express Railway Express Agency Santa Fe Refrigerator Despatch St. Louis Refrigerator Car Co. Swift Refrigerator Line Tropicana Products Union Refrigerator Transit Line Western Fruit Express Western Refrigerator Line

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