Chicago's Little Jewel

Jewel Tea Company, as it was known from its inception in 1899 until 1966, had a national reputation as a home delivery service long before it became established as the dominant Chicago grocery chain. The company was founded in 1899 with a rented horse and wagon by Iowa native Frank Skiff, who two years later would be joined in partnership by his brother-in-law, Frank Ross. Starting with a single Chicago route, sales of coffee (always the bedrock of the business) and other food items – mainly tea, spices and soap products were $11,000 in 1901, the first year of the partnership.

Jewel grew rapidly, to the point that they opened their own manufacturing plant in Chicago in 1909, in order to accommodate the growing demand for their private label foods and cleaning products. By 1910, sales had grown to a million dollars annually, and 100 routes were in operation. By 1915, sales had surpassed the $8 million mark and 850 routes were established, remarkable by any standard.

One of the keys to Jewel’s growth was the company’s practice of giving away premiums to their customers in order to help ensure their loyalty. Some of the premiums, for example, were giveaway lithographs featuring engraved, idyllic scenes in the Currier and Ives mold. These lithographs did much to stimulate the sales of Jewel’s soap flakes, a harder sell than one would think in those days when many families made their own soap from animal fats and such (yeesh, shades of Granny Clampett!). The most common premium approach, however, usually consisted of a coupon included in a package of coffee or tea which customers could save and redeem for a piece of Haviland China. For years Haviland would enjoy a very successful partnership with Jewel. (Later the company would partner with East Liverpool, Ohio-based Hall China, manufacturers of the famous Jewel “Autumn Leaf” pattern, a wildly popular series with collectors today. As John Wright points out in his Marketing History of the Jewel Tea Company, “(Jewel’s) coffee sales spiraled even at company prices of twenty-five cents a pound at a time when grocery stores only charged seventeen cents”.

Frank Ross was responsible for one of history’s most successful marketing devices, one which would pay dividends for Jewel Tea and a good number of other companies through the years – the advanced premium. Now a Jewel salesman would offer a homemaker an entire set of Haviland China up front – her family would have use of the wonderful new dishes right away. All she had to do was buy a certain number of Jewel products over an agreed period of time. Customers appreciated the trust, and Jewel’s sales exploded. More than any other factor, the advanced premium placed Jewel atop the industry.

A major milestone was reached in March, 1916 when Jewel Tea Company was listed on the New York Stock Exchange. Fueled by their success, Skiff and Ross set out on an ambitious expansion drive to double the amount of service routes, adding distant regions of the country to the company’s operating area, whereas previous growth had always been contiguous to their existing territory, radiating from Chicago. Events would prove the drive to be a bit too ambitious in light of the onset of World War I, with its attendant shortage of raw material and other problems. In 1919, by which time both Skiff and Ross had stepped aside, the company incurred its first loss, ($1.6 million) and new president John S. Hancock took the reins.

The new team took steps to turn Jewel around, one of which was trimming low volume or unprofitable routes, ending up with some 1,000 routes by 1921 from a previous high of over 1,600. The cutbacks helped restore Jewel’s financial health, and over the next 10 years Jewel would regrow the route business, albeit at a much more conservative rate of 50-60 new routes a year.

In June, 1929 Jewel began construction of a magnificent headquarters complex in Barrington, Illinois, 32 miles northwest of Chicago, in what then could only be loosely called a suburb. “Jewel Park”, as it was called, would be the new home of the company’s headquarters and would also host their coffee roasting operation, turning out the company’s signature product in vast quantities.

In 1932, a new law was passed in the tiny community of Green River, Wyoming, which would have at least a partial hand in shaping the destiny of Jewel Tea. The law, which came to be known as the “Green River Ordinance”, forbade uninvited solicitors, striking at the very heart of Jewel’s livelihood, driving home the necessity to Jewel management of diversifying the business. Also, the company, now fully recovered from its earlier travails, found itself at this point with a large surplus of cash and a critical need to put the money to good use. The perfect vehicle was about to come their way.

On March 14, 1932, The Wall Street Journal announced that the Jewel Tea Company had purchased 77 Chicago-area grocery stores from Loblaw Groceterias, Inc., a Canadian firm (which is still a familiar name to Canadian shoppers, by the way) which was seeking to trim back its operations during the darkest economic hour of the 1930’s. At the same time, Jewel bought out four stores from the Middle West Grocery Co., about which I’m pretty sure next to nothing is known today. So out of the box, Jewel entered the market with 81 stores.

Pictured above are three 1930’s Jewel Food Stores with an average of probably 5 to 7,000 square feet, very much in keeping with other chain grocers of that era. Oftentimes the stores occupied the first floor of a much older building. As Jewel upgraded from the Loblaw properties, more and more of the stores had the porcelain glazed brick facades. The location of the first two stores is unknown; the third features a pocket-sized Jewel (next to a pocket-sized Woolworth’s) in Des Plaines, a Northwest Chicago suburb. Below, in a nod to Jewel’s original home-service business, are some 1940's photos featuring Jewel’s lineup of home delivery products.