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Boston's Ice King: A Forgotten Capitalist Hero

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10/04/2018

“The first transport of Ice, from the shores of the United States to the banks of the Ganges is an event of no mean importance; and the names of those who planned and have successfully carried through their adventure at their own cost, deserve to be handed down to posterity with the name of other benefactors of mankind.”1

This laudation was written in 1837, in the Calcutta Courier. The idea that people in Calcutta, India, were able to make ice cream, among other luxuries, in 1837 is quite phenomenal, and grateful Brits and Indians were so thrilled at having access to ice — something that was effectively non-existent in the heat of southeast Asia — that they actually sent Boston’s “Ice King,” Frederic Tudor a thank you gift for making available to them all the benefits of ice.

But there is more to the story of the “Ice King” than Tudor’s incredible entrepreneurial vision. The global ice industry arose largely as a result of American capitalism, which was thriving in early nineteenth-century Boston — a city that grew wealthy from industries such as this, despite its dearth of natural resources. Frederic Tudor was not the first person to sell ice, but he was the first to build a thriving global ice industry, which not only made him a wealthy man, but also created a way for food to be kept edible longer, meats fresher than alternative preservations methods, and luxuries available to people who had never seen them before — such as ice cream to the people of Calcutta.

In Walden, Henry David Thoreau would eventually observe some of Frederic Tudor’s employees harvesting ice from Walden Pond, and mesmerized by the ice industry, he wrote, “Thus it appears that the sweltering inhabitants of Charleston and New Orleans, of Madras and Bombay and Calcutta, drink at my well.”2 The harvesting of large, strategically cut blocks of ice from Thoreau’s famous pond was only one element of the ice industry that Frederic Tudor built. The more challenging aspect was to find a way to ship across the world a supply of merchandise that would melt along the way, and then to create a base of return customers who would likely be reluctant to buy ice that would melt before they got to make use of it. Ice was no easy product to make profitable.

To create the ice industry, Tudor had to take on any number of risks that prevented other entrepreneurs from entering the market. Not only was there no way to effectively ship ice long distances at the outset of the nineteenth century, but the market for ice fluctuated wildly depending on the season; there are few buyers of ice in the winter, at least until you can find a way to bring it to those areas where it melts the fastest. And merchant boats were reluctant to ship large blocks of ice, fearing that the ice would melt, sinking their ships (an unfounded fear, but one that stood in Tudor’s way nonetheless). To try to offset some of his barriers, he appealed to the government to grant him a monopoly over the industry, but he was denied this privilege and had to build the industry according to his own merit.

To do this, Tudor invented the “Cold Chain.” The Cold Chain was a system of transporting ice in insulated containers that would preserve enough of the ice to enable global transportation. The biggest challenge of this was transition points in which the ice had to be moved from one container to the next, removing it from the self-insulating storage in which an outer wall of melting ice served to preserve the interior blocks of ice. Even if Tudor could find a way to technologically solve this problem, he had to do so in a way that would keep the cost of supplying ice low enough to profit off of the low prices people were willing to pay for it, reminding us once again of the importance of economic calculation and the price system when allocating resources to innovative technologies. So through a great deal of expensive trial-and-error, Tudor came up with various innovations that, when linked together, allowed ice to be moved from its source to carts, from carts to trains, and from trains to ships, and he did this while drastically reducing the rate at which the ice melted inside his well-insulated containers.

Many people understandably questioned Tudor’s wisdom when he made his first global shipment in 1806. The Boston Gazette had to remind its readers that their story of an ice shipment across the Atlantic Ocean was not fabricated: “No joke. A vessel with a cargo of 80 tons of ice has cleared out of this port for Martinique. We hope this will not prove a slippery speculation.”3 In this first venture, Tudor lost his shirt. He had figured out a way to ship the ice long distance, but his customers had no way of keeping it from melting after purchase. He recommended that they transport it home in linen blankets, but when this failed to keep the ice from melting away, he wound up with a whopping loss of $2,500.

But Tudor did not conclude from this that the ice industry was an impossibility. Instead, he had a new problem to solve. Knowing that he could ship the ice, he needed a way for his customers to preserve it after purchase. This was vital in creating a long-term market, rather than a snake-oil business. As Jonathan Rees writes:

While less scrupulous businessmen might have let people buy ice only to see it melt away, Tudor wanted to create permanent customers. To keep customers coming back for more, Tudor gave them storage containers of his own invention, and these receptacles formed a crucial piece of Tudor’s rudimentary cold chain.4

Tudor improved upon his receptacles over time, but the important element is that this entrepreneur, despite selling to markets that were literally oceans away from him, was determined to find a way to keep his customers coming back for more, and that meant conducting honest business.

Tudor earned himself the reputation as Boston’s “Ice King,” but he never did achieve monopoly status. In fact, his ice trade was so lucrative that by the 1830s, hordes of competitors were emerging to compete with him. Even though they copied his inventions as closely as they could, many of them failed to make their global ice trade as profitable as his. Tudor had established a level of efficiency that couldn’t be beaten. But even if he was the dominant seller, he never cornered the market. By 1849, Tudor estimated that he served less than a quarter of the market for ice.

Tudor is almost an unheard of figure in the history of innovative entrepreneurs who amass great fortunes through their ingenuity. Like the Rockefellers and Carnegies that came after him, he started work when he was only thirteen years old, where he learned how to conduct business well enough to establish success before creating the industry for ice. Once he finally did create the ice trade, he lost thousands of dollars (his $2,500 loss in Martinique would translate to $40,000 today, and that was after funneling money into figuring out how to get the ice across the ocean in the first place). He did appeal to the government for special privileges, but he was denied, and as soon as he finally did figure out how to make the ice trade a lucrative industry, his market share was kept modest by the influx of new competitors trying to duplicate his success.

Ultimately, though, Frederic Tudor was rewarded with great wealth, but only after he provided the world with the means of preserving food for both edibility and flavor, while also making available luxuries such as ice cream available to people as far away as Bombay, earning him praise as one of the great “benefactors of mankind.”

  • 1. Quoted in Jonathan Rees, Refrigeration Nation: a History of Ice, Appliances, and Enterprise in America, Studies in Industry and Society (Baltimore: The Johns Hopkins University Press, 2013), p. 25.
  • 2. Henry David Thoreau, Walden (1854; Princeton: Princeton University Press, 2004), pp. 297-98.
  • 3. Quoted in Rees, Refrigeration Nation, p.15.
  • 4. Ibid., p. 21.

Chris Calton is a 2018 Mises Institute Research Fellow and an economic historian. He is writer and host of the Historical Controversies podcast.

See also his YouTube channel here.

Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.
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