The NICE biscuit makers: Huntley & Palmer (Part II)

This article continues from Part I. Part II chronicles the decline of Huntley & Palmer.

George Palmer (1818 – 1897), the driving force behind the firm, died in 1897 and the following year Huntley & Palmer was registered as a private limited company. The company had 4,000 employees in 1899.

Huntley & Palmer was the 38th largest British industrial company in 1905, with a capital of £2.4 million (c. £255 million in 2014). It had 6,500 employees.

Huntley & Palmer introduced the coconut-flavoured NICE biscuit in 1904. Iced gems were introduced in 1910. The company pioneered the manufacture of cakes for grocers shops.

Huntley & Palmer, as late as 1910, largely eschewed advertising.

By 1911 the company had a regular staff of 7,000, not counting the additional workers taken on during peak times. That year, Huntley & Palmer was accused of dismissing without notice workers who were affiliated with trade unions, although company officials denied the accusation.

By 1914 almost half of production was exported, 50 percent of which was destined for the Far East and Africa. The export trade was slow to rebuild after the First World War; in 1924 only 25 percent of output was exported. Meanwhile, domestic sales declined as H&P failed to introduce new products or update existing ones. Marketing was poor, with inadequate advertising, fewer salesman than other firms and no depots outside Reading.

It has been argued that Huntley & Palmer had too many product lines to produce efficiently, and that the Palmer family paid themselves overly generous dividends and salaries, funds which might otherwise have been reinvested into the business.

By 1920 Huntley & Palmer operated 24 acres of factories across 36 acres of floorspace. 90 percent of the thousands of tons of flour used annually was grown and milled in the area around Reading. The Osborne (similar to a digestive) was their most popular biscuit, followed by the Marie (rich tea) and the Ginger Nut.

High income tax and death duties persuaded H&P to merge with Peek Frean of London, under a holding company called Associated Biscuit Manufacturers, in 1921. Individual production and marketing strategies were maintained by the two companies.

By neglecting the commodity category of the biscuit market, ABM’s domestic market share had declined to 15 percent.

William Howard Palmer died in 1923 with an estate valued at £536,794.

In 1923 a factory was opened near Paris. At the time it was decried in Britain as the transfer of jobs overseas.

In 1924, 80 percent of the 6,000 strong workforce at the Reading factory went on strike. The dispute, regarding worker efficiency, was settled within three days. Huntley & Palmer agreed to recognise the worker’s union.

By 1927 Peek Frean turnover and profits had exceeded those of Huntley & Palmer. Peek Frean installed automated biscuit plants in the early 1930s, but H&P did not do so until 1938.

In 1935 ABM employed 7,245 people.

Two large rivals emerged: by 1938 the value biscuit manufacturer George Weston Ltd had established production volumes that equalled ABM. In 1948 the Scottish firms McVitie & Price and MacFarlane Lang merged to form United Biscuits, with 3,350 employees.

In 1949 factories were opened in Canada, the United States and Australia. In 1954 the Peek Frean factory employed 3,700 and the Huntley & Palmer factory employed 3,000. A new factory was opened in Huyton, Liverpool in 1955.

The Cornish Wafer was H&P’s highest selling biscuit by 1954. Associated Biscuits concentrated on cream, savoury and assorted biscuits. Around 15 to 20 percent of production was exported in 1959.

Jacob’s, the third largest biscuit manufacturer in Britain, was acquired by ABM in 1960. ABM was reorganised as Associated Biscuits in 1969. In 1972 AB employed 9,856 people. From 1972 the company dedicated the vast majority of its advertising spend on the Jacob’s brand. One third of sales came from overseas, with factories in Australia, Canada and India.

Associated Biscuits had an 18 percent share of the British biscuit market by 1976. It was behind United Biscuits with 40 percent. The Reading factory was closed that year, and production was relocated to Liverpool.

In 1982 Associated Biscuits employed over 14,000 people in Britain, and 3,100 overseas.

Nabisco, the American manufacturer of Shredded Wheat and Ritz crackers, acquired Associated Biscuits in 1982. Nabisco was interested in the Huntley & Palmer brand, as well as its worldwide distribution network, particularly in Singapore, Canada, France and Germany.

The Huyton factory was closed in 1984 with the loss of 770 jobs, and production was relocated to Aintree, Liverpool.

Huntley & Palmer was positioned as the Associated Biscuits premium sweet biscuit brand. However by 1988 it counted for just five percent of company production by weight.

Nabisco did not successfully manage their British biscuit operations. Their market share in biscuits declined to 11.7 percent by 1988, and they were forced to reverse their decision to discontinue production of Bath Oliver biscuits following popular protest.

The Peek Frean factory at Bermondsey was closed in 1989 with the loss of 1,022 jobs. The site was closed due to high overheads and traffic congestion. Production was transferred to Aintree and Leicestershire.

Associated Biscuits was acquired by BSN of France in 1989.

The Huntley & Palmer brand was phased out in favour of the Jacob’s name in 1990. It made sense to concentrate resources behind a single brand, and the Jacob’s name was better known, and believed to have a more contemporary image than the Huntley & Palmer brand. Huntley & Palmer products subjected to a re-branding included Romany and Crumbles.

The head office was relocated from Reading to Liverpool in 1996.

BSN (now called Danone) sold its UK and Irish biscuit operations to United Biscuits for £200 million in 2004.

Former Huntley & Palmer products such as Lemon Puffs and Cornish Wafers are still sold under the Jacob’s brand, and Thin Arrowroots under the McVitie’s name.

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