Charles Pratt
American businessman and philanthropist
Years: 1830 - 1891
Charles Pratt (October 2, 1830 – May 4, 1891) is an American businessman and philanthropist.
Related Events
Filter results
Showing 6 events out of 6 total
An advertising slogan is "The holy lamps of Tibet are primed with Astral Oil."
Born in Watertown, Massachusetts, Pratt was one of eleven children.
His father, Asa Pratt, was a carpenter.
Of modest means, he had spent three winters as a student at Wesleyan Academy, and is said to have lived on a dollar a week at times.
In nearby Boston, Massachusetts, Pratt had joined a company specializing in paints and whale oil products.
In 1850 or 1851, he had come to New York City, where he worked for a similar company handling paint and oil.
In 1861, the then twenty-one-year-old Henry had pooled his savings of approximately US$600 with a friend, Charles P. Ellis.
They had set out to western Pennsylvania and its newly discovered oil fields.
Borrowing another US$600, the young partners had begun a small refinery at McClintocksville near Oil City, naming their new enterprise Wamsutta Oil Refinery.
The old Native American name "Wamsutta" had apparently been selected in honor of their hometown area of New England, where Wamsutta Company in nearby New Bedford had opened in 1846, and is a major employer.
The Wamsutta Company had been the first of many textile mills that had gradually come to supplant whaling as the principal employer in New Bedford.
In their first year of operation, Rogers and Ellis and their refinery had made US$30,000, an amount greater than the earnings of three whaling ship trips during an average voyage of more than a year's duration.
When Rogers returned home to Fairhaven for a short vacation the next year, he had been greeted as a success.
While vacationing in Fairhaven in 1862, Rogers had married his childhood sweetheart, Abbie Palmer Gifford, who was also of Mayflower lineage, and who had returned with him to the oil fields where they lived in a one-room shack along Oil Creek where her young husband and Ellis worked the Wamsutta Oil Refinery.
While living in Pennsylvania, their first daughter, Anne Engle, had been born in 1865.
They will have five surviving children together, four girls and a boy.
Although Ellis and Rogers have no wells and are dependent upon purchasing crude oil to refine and sell to Pratt, the two young men had agreed to sell the entire output of their small Wamsutta refinery to Pratt's company at a fixed price.
This had worked well at first until, a few months later, crude oil prices suddenly increased due to manipulation by speculators.
The young entrepreneurs had struggled to try to live up to their contract with Pratt, but soon their surplus had been wiped out, and they became heavily in debt to Pratt.
Charles Ellis had given up, but in 1866, Henry Rogers had gone to Pratt in New York and told him he would take personal responsibility for the entire debt.
This had so impressed Pratt that he had immediately hired him for his own organization, making Rogers foreman of his Brooklyn refinery, with a promise of a partnership if sales run over $50,000 a year.
The Rogers' family had moved to Brooklyn, and Rogers had moved steadily from foreman to manager, and then superintendent of Pratt's Astral Oil Refinery.
Henry Huttleston Rogers, the son of Rowland Rogers, a former ship captain, bookkeeper, and grocer, and Mary Eldredge Huttleston Rogers, was born in Mattapoisett, Massachusetts, on January 29, 1840.
Both parents were of English descent and were descended from the Pilgrims who arrived in the seventeenth century aboard the Mayflower.
His mother's family had earlier used the spelling "Huddleston" rather than "Huttleston."
Henry Huttleston Rogers has accomplished and exceeded the substantial sales increase goal that Charles Pratt had set when recruiting him.
As promised, Pratt gives Rogers an interest in the business, forming Charles Pratt and Company in 1867.
He is granted U.S. Patent # 120,539 on October 31, 1871.
In the past few years, Rogers has become, in the words of Elbert Hubbard, Pratt's "hands and feet and eyes and ears" (Little Journeys to the Homes, 1909)
As their family grows, Henry and Abbie continue to live in New York City, but vacation frequently at Fairhaven.
Standard Oil absorbs twenty-two of its twenty-six Cleveland competitors in less than four months in 1872, in what will later be known as "The Cleveland Conquest" or "The Cleveland Massacre".
John D. Rockefeller had in January 1870 formed Standard Oil of Ohio, which had rapidly become the most profitable refiner in Ohio and has grown to become one of the largest shippers of oil and kerosene in the country.
The railroads are fighting fiercely for traffic and, in an attempt to create a cartel to control freight rates, had formed the South Improvement Company, a Pennsylvania corporation, in the fall of 1871, in collusion with Standard and other oil men outside the main oil centers.
The cartel receives preferential treatment as a high-volume shipper, which includes not just steep rebates of up to fifty percent for their product, but also rebates for the shipment of competing products.
Founded by Thomas A. Scott, president of the Union Pacific Railroad in 1871-1872, the South Improvement Company had issued two thousand shares of stock, of which nine hundred are controlled by Rockefeller and his partners.
Rockefeller had then started negotiations to collude with the three major railroads running through Cleveland: the Pennsylvania Railroad, the Erie, and the New York Central.
The result of these secret negotiations were as follows: (1) The official rate per barrel from Cleveland to New York will be $2.56, but South Improvement will receive a $1.06 rebate; (2) The railroads will also pay South Improvement $1.06 per barrel of oil shipped that is not produced by South; (3) The railroads will also give reports of the shipping destinations, costs, and dates of all of South's competitors; (4) The commerce will be divided evenly among the railroads, with a double share going to Pennsylvania Railroad; and (5) South will provide tank cars and loading facilities.
The secret concessions would have helped lessen the "vicious" competition among the railroad lines by giving a steady, standardized flow of commerce, but word leaks out of the South Improvement Scheme, and the proposed one hundred percent increase in rail shipping rates inflames the independent producers and many smaller refineries.
Following a summit and vocal protest by the independent oil producers and refiners led by Pratt and Rogers of the Charles Pratt and Company refining interests of Brooklyn, New York, which comes close to physical warfare, including boycotts and vandalism, in western Pennsylvania in March 1872 (and comes to be known as the "Oil War"), the railroads soon agree to back down.
Pennsylvania revokes the cartel’s charter and equal rates are restored for the time being.
Although Rockefeller will become the target of many who decry Standard Oil's ruthlessness in subsequent years, the South Improvement rebate scheme had been Flagler's idea.
Undeterred, though vilified for the first time by the press, Rockefeller continues with his self-reinforcing cycle of buying competing refiners, improving the efficiency of his operations, pressing for discounts on oil shipments, undercutting his competition, making secret deals, raising investment pools, and buying rivals out.
Even Charles Pratt and Henry H. Rogers, Rockefellers’ former antagonists, eventually see the futility of continuing to compete against Standard Oil: in 1874, they make a secret agreement with their old nemesis to be acquired.
Pratt and Rogers become Rockefeller's partners.
Rogers, in particular, becomes one of Rockefeller's key men in the formation of the Standard Oil Trust.
Pratt's son, Charles Millard Pratt, will eventually become Secretary of Standard Oil.
For many of his competitors, Rockefeller has merely to show them his books so they can see what they are up against, then make them a decent offer.
If they refuse his offer, he tells them he will run them into bankruptcy, then cheaply buy up their assets at auction.
He sees himself as the industry’s savior, "an angel of mercy", absorbing the weak and making the industry as a whole stronger, more efficient, and more competitive.
