Tuesday, December 2, 2014

Cyrus McCormick: Inventor, Businessman

Cyrus McCormick
When a country becomes industrialized, there is a tendency that the population will grow. That happened to many countries. The United States, during the Gilded Age, underwent rapid industrialization. High population is not much of a problem as long as food production could keep up. The US managed to do it with the mechanization of agriculture. Among the forerunners in mechanization Cyrus McCormick. 

Cyrus McCormick (February 15, 1809 – May 13, 1884) was from a farmland in Virginia and invented what would revolutionize agriculture around the world - a reaper. The idea of a mechanized reaper for farming was not originally from him but from his father. When he fulfilled his father’s dream, he made a fortune out of it. He became a wealthy man. Later on, his descendants carried on the business and helped to form one of the biggest companies in the US, the International Harvester.

Cyrus McCormick was born to a well-off family on February 15, 1809. He was born to Robert and Mary Ann McCormick. His father, during the time of his birth, worked hard to make a machine that would eased the required manpower and time needed in the fields. Eventually, Robert would pass the job to his son in 1831. From his father, Cyrus learned many mechanical skills. He also learned the value of mechanization of farming.

When his father passed the job to him, he produced his first and successful mechanical reaper. It was horse drawn and it only needed two individuals to operate. It also made harvesting faster. He decided only to patent his invention in 1834 when a certain Obed Hussey also invented his own reaper. McCormick knew that if he would have a business out from it, he needed to patent it first. Eventually he managed to obtain a patent for his reaper. However, Hussey didn’t surrender and filed a lawsuit against McCormick. The court battles would continue until the death of Hussey in 1860.

Meanwhile, McCormick wanted to build more of his reapers. With the help of his father, he bought an iron workshop in Walnut Grove. But fate intervened when the Panic of 1837 happened and brought down his start up business.

In 1840, he tried again to establish a business for his reaper. This too, was not successful. On the first year, he only sold 2 reapers. Three years later, he only sold less than fifty, and by 1846, he sold just about fifty.

In 1847, he decided that there would be no future for his business in Virginia. He established the McCormick Harvesting Machine Company in Chicago, a growing metropolitan city because of the rise of agriculture in the mid plains. McCormick knew that in the flat and wide mid-plains the reaper would be utilized more effectively than in the sloppy Virginia farms.
McCormick, by the late 1840’s, was nearing a deadline. His patent for the reaper would expire in 1848. Therefore, before that year, he must establish himself as a big producer of agricultural implants or face competition and, probably, loss, if other companies manufacture reapers in a much successful rate. To avoid impending competition, he made improvements in his reapers. Luckily, his business began to take off when he established himself in Chicago. One contributing factor for his rise of his sales was advertisement. For example, when he purchased the agricultural newspaper, Farmer’s Advance, which circulate copies of more than 300,000, it became a contributing factor at the rise of sales. He also offered warranties, credits, and the first money-back guarantee to customers to entice them to buy his machines. Another factor was his high quality product for a cheap price of $120. He utilized what now known as an assembly line to produce reapers in a massive scale and in a cheap cost, reducing its selling price drastically. 

Soon enough, his company grew rapidly. By 1850’s, the company began to export its reapers abroad, starting with Russia. He also began to show increase in sale when he began to use the system of dealership to allow far away customers to buy his products. By 1856, his Chicago factory produced more than 16,000 reapers and other farm machinery. By 1858, the total asset of McCormick reached $1 million. In 1859, when he was mostly away from Chicago, he made his brothers, William and Leander, partners to form the C. H. McCormick & Bro.

During the Civil War, the sale of McCormick’s machine soared further. Because of lack of manpower, when most were in the front lines of the war, the use of machines for farm labor was the most practical thing to do to keep the lands in use and to keep income flowing. By the end of the war, McCormick’s company appeared to be at the top of the industry.

In 1871, a tragedy, but with an opportunity, came to McCormick. The Great Chicago Fire destroyed his reaper factory. The destruction of the factory proved to be an opportunity. The destroyed factory had already been in its full capacity and couldn't meet the demands. With his earnings, McCormick built a new factory that was larger in size and in capacity. The new factory was able to produce 50,000 reapers per year.

By the last year of the 1870’s and the 1880’s, the McCormick Company continued to grow further. In 1879, the McCormick Harvesting Company was incorporated. Furthermore, his company continued to expand abroad, reaching as far as New Zealand.

Besides building a farming equipment empire, McCormick spent his time in other activities. One of which was making his opinions heard, especially during the time when slavery was a big issue. He was pro-slavery and bought a newspaper company, the Chicago Tribune, to show this sentiment. However, it was unpopular and sometimes, criticized.  In 1864, he became interested in politics and ran for congress unsuccessfully. But in 1876, he tried again; this time, to be a Vice President candidate. Yet again, he failed. In 1879, he began to lecture when he was elected to the French Academy of Science. Another activity he did was charity works. He gave a lot of money to his Presbyterian Church, to a seminary that would become the McCormick Theological Seminary and Young Men’s Christian Association.  

In May 13, 1884, Cyrus McCormick passed away and his company went to his son, Cyrus McCormick Jr. McCormick Jr. presided over with the New York financier, J.P. Morgan, a merger of competing harvesting company that resulted to the foundation of the International Harvester. The McCormick family dominated the company.


Bibliography:
Clark, C ed. Encyclopedia of Tariffs and Trade in U.S. History. Connecticut: Greenwood Press, 2003.

Dobson, J. Bulls, Bears, Boom, and Bust: A Historical Encyclopedia of American Business Concepts. California: ABC-CLIO, 2007.  

Geisst, C. Encyclopedia of American Business History. New York: Facts On File, 2006.

Pripps, R. The Big Book of Farmall Tractors: The Complete Model-by-model Encyclopedia. Maryland: Voyageur Press, 2003.

Witzel, M. The Encyclopedia of the History of American Management. Bristol: Thoemmes Continuum, 2005.

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