Coping with Competition

The Making of:

This article had the same origins as two of the others -- "have paper, will travel"; or maybe "want to travel, write paper." My 2008 trip to the Hagley had been very rewarding, but it was pretty clear that there was no point taking my little bucket back to their very generous well for another stove-related dip. So I would need to finance a follow-up in some different way. But not very different. I offered a paper to the Penn Economic History Seminar, organized by a couple of old acquaintances, Walter Licht and Dan Raff, and of the couple of possible subjects I proposed, this is the one that they accepted. So I wrote it -- "What Price Competition? Cooperative Associationalism in the US Stove Industry, c. 1870-1925." I was quite happy with the result, but the commentator, my old friend Phil Scranton, wasn't (he had probably had too much exposure to my non-theoretical, anecdotal-empirical style, at the previous two years' Hagley meetings, which he had organized). Nor were many of the audience members, particularly the economists (as these notes on the discussion make clear). So I wasn't very happy with the experience either, but it had served its purpose -- I had written something new, and could enjoy another research visit for which I had not needed to buy the air ticket, etc. It was a good trip, too, with work at the New York Public Library, Library Company of Philadelphia, Historical Society of Pennsylvania, Hagley, and Winterthur. After the trip, I was able to extend the paper through the 1920s on the strength of work at the Hagley and NYPL, thereby answering one of the main criticisms I had received (what happened after the Federal Trade Commission's intervention?). And it earned some more air miles, when I took the revised version to the Fuqua School of Management, Duke University, and the Business History Seminar at the LSE, the following year. They didn't think very much of my arguments in Durham, North Carolina, either (more unimpressed economists -- I should have written down more of their questions, comments, suggestions, and criticisms too, but it's difficult when you are trying to field them at the same time, and also getting over yet another foul-up with a data projector), but LSE's historians were more positive.

So I finally thought I had a decent article, apart from one great problem: its length. Walter Friedman, editor of the Business History Review, liked it 'in principle,' though he would have preferred to see it half the length and less of a (mere) case-study. I thought of these very reasonable desiderata as almost insuperable obstacles in the way of its completion and acceptance, as it was long because it had lots of stuff in it, and it really was just a case study, so laid it to one side and got on with other things. But eventually I decided to press on, for the usual REF-related reasons. I submitted a version that was admittedly much too long, but had benefited from the extra research done in 2009 and 2010 and input from a number of friendly academic correspondents. It still had the same main title, but its subtitle had changed to the rather snappier "Cooperation and Collusion in the US Stove Industry, c. 1870-1930." I figured out that, at the very worst, I would get some good editorial guidance in return, and a couple of qualified readers' reports. In fact, the outcome was better than that -- a conditional Yes. The big problem remained one of length, and to deal with it I got the help of a number of colleagues who knew nothing about the topic but were good editors. With their advice, I managed to sweat it down to a size that the Business History Review would accept, at the same time strengthening its argument by pruning away some of the surrounding shrubbery. The main differences between the published and the submitted versions are therefore that biographical and other extraneous detail has been reduced or removed, illustrations, charts, and tables have been lost because they did not really pay their freight, the conclusion has been beefed-up considerably, and the main title has been changed so that the result is even more alliterative. The result is, I think, quite a lot better, but still recognizable as the paper I always wanted to write about the history of the National Association of Stove Manufacturers.

What would I do to build on this article if, for example, I ever wanted to write the book on the stove industry that I thought I would, back in 2005-2007, after my first research trips to Albany, Troy, and Detroit, and when most of my primary source material (the Marcus Filley, Detroit and Reading Stove Works papers, the trade press, and the NASM papers) pointed me towards a solidly institutionalist history of the industry, its trade association, and its union, from Reconstruction to the First World War?

I would look further into the Federal Trade Commission papers at the US National Archives, which are voluminous but poorly organized. The published report is very thorough, and most of the research materials seem to have been incorporated into it, but not all; and the great advantage of the FTC report is its timing, so that (e.g.) the detailed company accounts on which it builds cover the critical period of the war and immediate postwar years, for which no NASM reports survive, and by which time there was little trade press interest either.
I would probably look to see what (if anything) was in the War Industries Board papers, to further illuminate the war period.
I would certainly look at the National Recovery Administration papers, to see how much of a connection there was between the Association whose reports ended in 1929, and the new or reborn Institute that wrote and administered the NRA Code. The Code experience might also be interesting. (I have checked, and there appears to be no connection between the Institute and the National Association of Food Equipment Manufacturers, founded 1948, which still survives, and at least one of whose members has enjoyed a continuous existence since the mid C19th and was a NASM stalwart.)

But I doubt that I will do any of these things, because the research I undertook in 2007 for the paper that became "Conquering Winter" and almost everything I have done since has pushed me back into the late C18th and antebellum period, so that my three long articles (this one, the earlier Business History Review piece, and my Winterthur Portfolio work) may well be all that I bother to write on the industry's period of maturity and stagnation.

Extras:

Bibliography -- including links to cited materials and, where the material is not available online, information about its physical location.
1866-1922 Lists of Stove Manufacturers -- stove makers attending the 1866 Albany Convention; in receipt of Giles Filley's 1871 Circular, and their response; NASM members (and non-members), 1873 and 1884; in business, 1892 and 1922. The sheet also includes output data from Dunlap (ed.)'s Wiley's American Iron Trade (1874). This is the nearest thing to a "census" of the industry over a fifty-year period that exists. It supports three maps -- for 1874, 1892, and 1922 -- summarizing changes (as well as much continuity) in the industry's structure and location.
Index to the Proceedings of the National Association of Stove Manufacturers, 1872-1929 -- potentially useful to others, or merely interesting, for browsing and seeing topics discussed. Most valuable in association with the following spreadsheet, which enables the (relatively) easy identification of speakers, their office-holding, convention attendance, company affiliation, cities of residence, etc. Volumes through 1915 are at the New York State Library (with a very few omissions); those from 1920 at the New York Public Library. The summer meeting of 1872 (not at the NYSL) is online at the Internet Archive!!
NASM Convention Attendance, 1872-1929 -- compiled from all surviving volumes of the Proceedings. Particularly in the early years, firms were almost always represented by proprietors, partners, or other "business principals," but later on other executives sometimes came too.
NASM Convention Attendance and "Membership" Turnover, 1873-1929 -- see comments on sheet and charts; this is derived from the previous dataset, and measures the ebb and flow of stove manufacturers' interest in the NASM, at least as indicated by their decisions to attend conventions (or not).
State Shares of Total Stove Output, 1875 and 1895 -- shows the gradual relocation of the industry from New York and Ohio towards the Midwest, in particular, across two decades.
NASM Secretaries' Reports on the State of the Industry, 1887-1913 -- Annual estimates of total stove output, 1887-1913. These data have been extended from the Heating & Cooking Appliances output figures for 1889-1930 from U.S. Historical Statistics (bicentennial edition), series P336, and the consumer durables price index, P373. As the first chart shows, these two output series are very close through the mid-1890s and then diverge, though they follow a similar course. This is probably because of the growing importance of new types of appliance and manufacturer, i.e. the stagnation and relative decline of the cast-iron stove industry's market share. The second chart is useful because (a) it contextualizes the war and postwar boom in the volume (and, even more, the current $ price) of business, helping explain the political sensitivity of price inflation in these vital domestic consumer durables, and thus the FTC investigation; and (b) it shows the swift recovery after the sharp contraction, 1920-1921. But this 1920s consumer durables boom did not include the cast-iron stove industry -- instead, it reflected investment in new fuels (electricity, oil, natural gas) and their associated appliances and systems (notably central heating), which further squeezed its market share.
Reading Stove Works Sales Data, 1893-1896 -- from the company's Minute Books at the Hagley. What they seem to show is the effectiveness of a local stove manufacturers' association (that for Eastern Pennsylvania was recognized as the strongest) and the consequences of the reduction in competition it produced: Reading's three big-city branch houses (Chicago, Philadelphia, and Boston, in that order) absorbed a little more than a third of total sales, with the remainder distributed among five travelling salesmen and local sales from the factory. The most profitable market was within Eastern Pennsylvania Association territory (Sheeler's) -- a quarter of the total -- where the ratio of sales to expenses was twice as good as in the much more competitive region (the Anthracite District and Hudson Valley) served by Dreher. A logical inference is that concentration on the company's "home market" made most sense.
NASM Secretaries' Reports on Industry Output, 1896-1914 -- much more detailed than (and not entirely consistent with) the 1887-1913 headline numbers reported above. These reports became increasingly ambitious, but always involved significant amounts of estimation, interpolation, and downright guesswork. Still, they were the best that could be achieved at the time, and the best information stove makers themselves possessed. What they show is the stagnation in the value of the output of cast-iron stoves, with all growth concentrated in novel goods (steel and sheet-iron, or malleable cast iron, stoves and furnaces; and gas appliances). Traditional products' market share declined from 86 percent of the total for these sectors in 1896, to 46 percent by 1914. One further interesting feature of these data is that they indicate that what stove makers lost (or abandoned) was the bottom end of the market for cast-iron stoves: the average unit price more than doubled, from $10 in 1896-1898 to $20-plus in 1909-1914, whereas steel and malleable range prices only grew about 50 percent, in line with the increase (57 percent) in the Consumer Durable price index between these years, vs. a 20 percent advance in the Consumer Price Index. (See Chart). Products whose sales volumes grew most -- gas ranges and heaters, sheet-iron heating stoves -- became relatively much cheaper, as their nominal prices barely changed.
[t.b.a.]