In October, we celebrated the launch of our WEcommerce Packaging Solutions™ and the 83rd anniversary of our corporation. At that time, we began writing a multi-part blog series about the changes in commerce throughout history.
In the first part, we discussed the Commerce and Packaging of the Ancients. In Part 2, we reviewed “Ecommerce” and Packaging During the Middle Ages and the Age of Exploration.
In this section, Part 3, we discuss how The Industrial Revolution laid the foundation for today’s ecommerce.
The First Industrial Revolution: The Age of Mechanical Reproduction
(~1733 to late 1860s)
The ability to use mechanical devices to produce goods efficiently defined the First Industrial Revolution. Thus, it is also called the Age of Mechanical Reproduction.
Manufacturing Innovations During the First Industrial Revolution
The First Industrial Revolution began in Britain with mechanical machinery that could weave cloth and spin yarn to make textiles quickly and efficiently. Additionally, Britain innovated methods to produce vast amounts of iron and steel.
However, the First Industrial Revolution was slow to expand outside of Britain. That’s because English laws forbade the export of machinery or workers. These laws resulted in a British monopoly.
Eventually, however, two Englishmen opened machine shops in Belgium. This move began the spread of efficient manufacturing across nations. 300 CE).
Transportation in the Age of Mechanical Reproduction: Powered by Steam
Transportation Across the Sea
Britain shipped wool, linen, and cotton cloth overseas in sailing ships at the beginning of The First Industrial Revolution. However, in 1807 Americans built the first steamboat. (It originally went about five miles per hour.)
However, by the end of the First Industrial Revolution, iron steamships transported goods across the sea.
Transportation Across Land
In the same era, horse-drawn carts on wooden rails transported people and goods across Great Britain. In 1804, however, Britain built its first steam locomotive. Simultaneously, its iron production became more efficient. Soon, iron locomotives, aptly named “Iron Horses,” crisscrossed the nation on iron rails to quickly deliver manufactured goods.
Transportation Across America
In America, stagecoaches moved mail, goods, and people westward from about 1830. These coaches crawled at five miles per hour. Therefore, it took about 52 days to cross between St. Louis and San Francisco by stagecoach.
By contrast, the Pony Express was the 19th-century version of Amazon Prime. It could deliver mail from the East to West Coast in just 10 days.
A New View of Business and Commerce Takes Hold During The Age of Mechanical Reproduction
A Scottish social philosopher published The Wealth of Nations (1776) during this period. His book promoted:
- Free enterprise
- Private ownership of manufacturing
- Lack of government interference
As a result, banks and industrial financiers adopted this philosophy. They began to back a factory system based on owners and managers–not government. This ideology still influences our thoughts about commerce and government today.
It also led to the creation of U.S. corporations in the 1790s. Soon, New York (1792) and London (1801) launched stock exchanges.
But the first significant U.S. industrial corporation, the Boston Manufacturing Co., didn’t exist until 1813. Furthermore, it wasn’t until 1820, just 40 years shy of the dawn of the Second Industrial Revolution, that the First Industrial Revolution took hold in the United States.
Currency During the Age of Mechanical Reproduction: Options Emerge
During this Age, multiple types of payment systems emerged.
Gold and Silver
Britain adopted the gold standard around 1820.
By contrast, the United States had a bimetallic standard, beginning in 1776.
In other words, the dollar was defined by gold or silver at specific weights and fineness. Gold and silver values were set at a ratio of 15 to 1.
However, world markets valued these metals at a 15½ to 1 ratio. Therefore, most of the gold left the country. As a result, silver was the de facto U.S. standard until 1834.
In 1834, the gold content was reduced in the dollar, making the ratio 16:1. The gold price was set at $20.67 per ounce. Soon, silver left the country, and gold became the de facto standard. What’s more, gold discoveries devalued gold even more. Consequently, even small silver coins disappeared from circulation.
The silver content of coins was reduced below the official value in 1853 to increase their circulation.
When the Civil War broke out, the federal government began to issue the first redeemable paper money. However, Americans could not redeem this money for gold or silver.
Additionally, states and banks printed their own money in large denominations before 1863. Therefore, only the wealthy could “afford” to handle the large banknotes. Furthermore, people, banks, and businesses weren’t legally required to accept this money! Moreover, an insufficient number of coins were available to do business
To solve these issues, the U.S. government created a national banking system in 1863.
Checks Emerge in the United States
The first printed checks appeared in the United States in 1762. Gradually, banks began issuing and accepting checks. By 1850, the use of checks was widespread in the United States. Moreover, merchants began writing sizeable checks to creditors rather than paying in cash.
Checks also made traveling by steamship or train less dangerous than bringing large sums of currency.
The Growth of Stores
Small, privately owned shops dominated most of the First Industrial Revolution.
Mom-and-pop shops, typically drug stores and general stores, began to emerge in the 1700s and 1800s. However, shopping was a daytime activity. With only candles and gas lamps, stores and factories closed at dusk.
By the end of this period, department stores such as Macy’s (1858) and Bloomingdales (1861) sprouted in New York. In Chicago, Marshall Fields & Company opened as a dry goods store in 1852. And two years later, Midwest department store chain Carson Pirie Scott & Co. opened its doors.
Packaging During the First Industrial Revolution
Across the Atlantic, Britain was laying the groundwork for the box-making industry. First, London stationers invented a papermaking machine. Next, a London worker began experimenting with turning wood pulp into paper in 1800.
By 1817, England produced the first commercial paperboard boxes. These first boxes were rigid. With the introduction of the Fourdrinier Machine in 1830, manufacturers could make single-ply boxboard sheets in different thicknesses.
Single-sided Corrugated for Hats
However, pleated paperboard (single-sided corrugated) wasn’t patented until 1856. Moreover, it wasn’t a packaging component. Instead, milliners lined tall hats with pleated paperboard.
The Emergence of Boxes
However, packaging and merchandising rarely, if ever, existed during most of this era. A shift occurred in 1839—exactly 100 years before Wertheimer Box opened its doors for business. A Boston jeweler began manufacturing rigid boxes for himself and other local jewelers.
As a result, box-making plants began to spring up, and many box-manufacturing innovations ensued during the Second Industrial Revolution.
The Second Industrial Revolution: The Technological Revolution
(~1870 to 1914)
The Second Industrial Revolution marked a time of accelerated manufacturing growth, standardization, and innovations. Therefore, it is also called the Technological Revolution.
Features of the Second Industrial Revolution
This period is characterized by the widespread availability of electricity, lightbulbs, phones, radios, airplanes, and urban sprawl. What’s more, steel replaced iron.
With electric lights and generators, factories could readily manufacture products 24 hours a day.
Globally, manufacturing spread beyond England during the Second Industrial Revolution. Mainland Europe, the United States, and Japan also became industry leaders. Economic growth and free trade began to rule the day.
Large business conglomerates overtook many mom-and-pop stores. For example, Pullman’s Palace Car Company built an industrial-owned town just 13 miles south of Chicago. Simultaneously, employee abuses and child labor led to the rise of Labor Unions.
Affordable paper increased the circulation of newspapers, books, and ideas by the turn of the century.
The Upsurge of Stores in Chicago and Shopping by Mail During the Second Industrial Revolution
No longer was agriculture the prevailing industry in the United States. Instead, factories and stores dominated large cities and employed their residents.
Department Stores Intensify Their Growth
In Chicago, Marshall Field’s met with increased competition:
- Discount Store S.S. Kresge’s (1875)
- Sears, Roebuck and Co. (1886)
- Montgomery Wards (1872)
- Wieboldt Stores (1883)
- Men’s clothing retailer Henry C. Lytton & Sons (1887)
In addition, Polish immigrant brothers and grocers opened Goldblatt’s Department Store.
These retailers also built wide distribution networks, expanding to other cities across the Midwest and the United States. They competed with sales, merchandising, marketing, and holiday storefront windows on State Street, beginning in 1897—a tradition that New York’s Macy’s began in 1874.
Shopping became entertainment. Store clerks offered demos, lectures, and special events. At the same time, radio and newspapers promoted products with advertising.
Mail Order Explodes
Wards became a mail-order catalog business in 1883 with its Wish Book. Other Chicago-based retailers soon followed:
- Charles A. Stevens (1886)
- Sears and Roebuck (1888)
- Chicago Mail Order Co. (1889)
- Joseph Spiegel (1905)
These catalogs were the forerunners of Amazon and other modern ecommerce retailers
Retail Trade Association Is Formed
In 1911, the National Retail Federation (NRF) was founded as the National Retail Dry Goods Association (NRDGA).
Transportation in the Technological Age
Transportation Across America
The Pony Express, stagecoaches, and the Wells Fargo Wagon became obsolete toward the end of the Second Industrial Revolution.
Instead, rail lines and motor vehicles enabled people and goods to cross the United States. Autos (invented in 1886), trucks (1896), and bicycles (1817) with “pedal cranks” (1853) came on the scene, allowing more efficient transport of goods.
Moreover, Henry Ford revolutionized manufacturing by successfully implementing an assembly line at an auto factory in Highland Park, MI. The year was 1913.
Currency During the Second Industrial Revolution
A retail credit company called Equifax opened in Atlanta in 1899. It began a list of creditworthy customers.
At about the same time, the United States formally passed the Gold Standard Act (1900). It was technically already in place. Soon, the use of paper currency became widespread in America. Other major countries also adopted the gold standard.
As the Second Industrial Revolution ended, Congress established the Federal Reserve System in 1913. It created Federal Reserve notes. These notes are the monetary unit or paper currency circulating in the U.S. economy today. In other words, they are dollar bills of various denominations.
Packaging During the Technological Age
Multiple Types of Packaging
Many new types of packaging came onto the scene during the Second Industrial Revolution. Innovations included:
- Paper bags (1844) and paper bag-making machines (1852)
- Flat-bottomed paper bags (1867)
- Machines to make flat-bottomed paper bags (~1871-1872)
- Heat-sealed paper bags (1879)
- Pleated paper bag-making machine (1883)
- Rotary bottle-making machines (1889)
- Machines that made in-line printed paper bags (1905)
- Paraffin wax-coated paperboard milk containers (1906)
- Chipboard boxes (1906)
- Cellophane (1908)
- Commercial-grade foil (1910)
- Paper shopping bags with corded carrying handles (1912)
- The accidental discovery of Dark Green Saran Wrap (1933) (initially sprayed on airplanes as a protectant)
The Packaging Industry Skyrockets
The packaging industry received an enormous boost after an 1898 merger.
That’s when Chicago-based National Biscuit Company (now Nabisco) introduced its Uneeda soda cracker. It chose new packaging instead of the traditional cracker barrel or crate. These old-fashioned methods made crackers soggy and stale.
Instead, Uneeda placed octagonal-shaped crackers in an inner waxed paper lining with a branded outer wrapper around a cardboard folder carton.
As a result, numerous industries took a giant leap forward:
- Box Making
- More types of packaging
- Advertising and marketing
The Birth of a Manufacturing Leader
On May 14, 1914, Ernest Wertheimer was born to Nathan and Yetta Wertheimer in Zilina. Zilina is a city situated in what is now northwestern Slovakia, near the Czech Republic and Poland. Ernest left his homeland after World War I.
(In 1968, current Wertheimer Box President Doug Wertheimer would visit Zilina.)
The Industrial Revolution created an explosion of industries: manufacturing, packaging, retail, advertising and more. In the next series, we explore commerce and packaging During World War 1 and World War II and the start of The Digital Revolution.
Brief History of the Gold Standard in the United States. Congressional Research Service.
A Brief History of Globalization. The World Economic Forum.
A History of Packaging. Ohio State University Extension
The History of Paperboard. Paperboard Packaging Council.
A History of Steamboats. The United States Army.
Mail Order. Encyclopedia Chicago.
What is the history of corporations in America? Investopedia.
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