The R.J. Reynolds Tobacco Company

The R.J. Reynolds Tobacco Company

The R.J. Reynolds Tobacco Company

The R.J. Reynolds Tobacco Company

Synopsis

In this corporate history of the R. J. Reynolds Tobacco Company, Nannie M. Tilley recounts the story of Richard Joshua Reynolds and the vast R. J. Reynolds tobacco complex with precision and drama.

Reynolds's rise in the tobacco industry began in 1891 when he introduced saccharin as an ingredient in chewing tobacco. Forced into James B. Duke's American Tobacco Company in 1899, the Reynolds company became the agency for consolidating the flat plug industry. In 1907, as the government began its antitrust suit against Duke, Reynolds himself bucked the trust and introduced another bestseller: Prince Albert smoking tobacco. The government won its suit in 1911; Duke's Tobacco Combination was dissolved, and Reynolds, left with a free and independent company, a much larger plant, and improved machinery, immediately began an expansion program.

In 1913 Reynolds introduced Camels, a blend of Burley and flue-cured tobacco with some Turkish leaf. Perhaps the best-known cigarette ever produced, Camels swept the market and generally led the way until the development of filter-tipped cigarettes in the 1950s.

Other important Reynolds advances include the systematic purchase and storage of leaf tobacco, the development of a stemming machine, the adoption of cellophane for wrapping cigarettes, and the production of cigarette paper. For its employees, the company established a medical department, introduced lunch rooms and day nurseries, and installed group life insurance. Perhaps more important than any of these items was the development of reconstituted leaf, a method of combining scrap tobacco and stems into a fine elastic leaf entirely suitable for use in any tobacco product. This achievement represented a savings of 25 percent in the cost of leaf and was followed by the development of the filter-tipped Winstons and Salems.

The R. J. Reynolds Tobacco Company includes absorbing accounts of the company's steady technological progress, its labor problems and advances, and its influential role in North Carolina and in the industry through 1962.

Excerpt

Even before its absorbtion into R. J. Reynolds Industries, the R. J. Reynolds Tobacco Company, now nearing its 109th year, ranked in sales among the first sixty industrial corporations of the United States. Moreover, in the accumulation of net profits it was eighteenth in 1961, seventeenth in 1962, and eighteenth in 1963. Among the first sixty corporations listed by Fortune magazine, the company is one of only three with headquarters in the South. In addition, it is the largest corporation in this group with both administrative and executive headquarters in the southern United States.

In 1875 Richard Joshua Reynolds invested $7,500 in a new enterprise for the manufacture of flat-plug chewing tobacco. By 1963 the company that evolved from this small beginning produced all of the major types of tobacco products except cigars and snuff, listed its assets at $1,037,639,534, employed 14,932 men and women, sold products totaling $1,672,444,707, and paid $68,000,000 in dividends to 103,282 stockholders. In achieving this position the company was continually under the management of southerners--many of them natives of North Carolina.

Among the various employees and officers of the company who helped make this history possible, I am greatly indebted to the late John C. Whitaker. He became an employee of the company in 1913 and ended his career as chairman of the board in 1959. In 1950, he began to plan for a history of the company, and appointed Erwin W. Cook, Dell Mc- Keithan, and W. S. Koenig to interview many of the oldest employees from Will Reynolds to the lowliest workman in Factory Number 8. Although Whitaker was unable to turn his full attention to the history until 1958, the material gathered by Cook, McKeithan, and Koenig proved to be invaluable.

My first information about such a history came in the fall of 1958 in a letter from William J. Conrad, Jr., then vice-president and secretary of the company, asking my advice on procedure. Understanding what lay behind this request, I began to consider the matter in the light of my long-time interest in the tobacco industry and my appreciation of the company's historic stand in support of the efforts of tobacco farmers to sell their leaf cooperatively. I flew to Winston-Salem and, with Charles B. Wade, Jr., made arrangements that, as the text of this volume will indicate, imposed no restrictions on me. At that time, however, I learned virtually nothing . . .

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