In Victorian times, the Tuke family of northern England were Quaker philanthropists who contributed greatly to the treatment and housing of the insane. A misfit in their portfolio was a small cocoa factory in York that was being operated by a manager named Henry Rowntree, another Quaker. In 1862, he bought out the Tukes and turned it into a confectionery company. Seven years later, the company was in financial difficulties, and Joseph, Henry’s brother, joined him as a full partner. H.I. Rowntree & Co. was then formally established. Henry died in 1883 and the entire company passed to Joseph.
One of Rowntree’s early products was a small chocolate bead with a hard sugar coating. The coating avoided the chocolate melting in clothing or in handling. The “chocolate beans,” as they were called, were among rations given to soldiers in the Spanish Civil War (1936-39). In 1937, Rowntree was forced to change the name of this product by new trading standards because it was felt the use of the word “beans” was misleading. The new title, “Milk Chocolate in a Crisp Sugar Shell,” somehow never really caught on, and later they rebranded the product “Smarties” (British Smarties are very different than American Smarties and there is no connection between the companies). In company with big U.K. names Cadbury and Fry, which also had Quaker connections, Rowntree became one of the top three confectionery manufacturers in the U.K. in the 19th and 20th centuries. Among other famous Rowntree brands were Kit-Kat and Aero (launched in 1935) and After Eight (thin mint chocolates in 1962).
In 1932, a young man named Forrest Mars was working for his father and business partner, Frank C. Mars, who owned a confectionery company in the U.S. There was a major argument over expansion of the company, which Forrest felt was overdue. Forrest Mars took a buyout from his father, along with rights to sell certain Mars products overseas. After short spells with Nestlé and Tobler in Europe, learning the candy business there, he moved to England, and began to manufacture Mars Bars for troops.
During the Spanish Civil War, Mars encountered the troops eating the small chocolate beans by Rowntree. Typically, chocolate sales fell off during summer due to lack of air-conditioning, and Mars was much taken with a chocolate product that would be able to resist higher temperatures. When Mars eventually returned to the U.S., he asked a friend, Bruce Murrie, who was the son of Hershey chocolate’s president William Murrie, to join him in a new venture. Forrest shrewdly anticipated a chocolate and sugar shortage in the coming war with Germany and was seeking a partnership that would ensure a steady supply of resources to produce the new candy. Murrie received a 20 percent stake in the company, which was named to represent the partners, and the union enabled the company to use Hershey’s monopolized chocolate rights during wartime chocolate rationing. No doubt Forrest Mars also had an eye on a deal that Hershey had to provide chocolate to U.S. troops. This was all an enormous marketing coup, at once securing supplies that were liable to rationing and a monopolized market to garner widespread product awareness via distribution to U.S. troops. After the U.S. entered the war, the candies, named M&Ms, were exclusively sold to the U.S. military.
In 1941, Mars was granted a patent for his manufacturing process for sugar coated chocolate, and production for public sales began in Newark, NJ. Shortly after the war was over, the candies began to be sold to the public once more, and Forrest Mars bought out Murrie’s shares and reclaimed full ownership of the company and brand. Forrest later took over the Mars family business from his father in parallel with his own M&M brand, but he did not amalgamate M&M with the Mars group until much later. Perhaps an independent income was still attractive.
In 1950, Mars developed a version of offset printing to apply the letters “M&M” to each candy using a vegetable dye. It was a marketing move to ensure everyone that they were getting the genuine article. Initially in black, the monogram became white in 1954. Mars product Skittles uses the same process today to apply the letter S.
Rowntree had studiously avoided takeovers and mergers with other companies, but on April 13, 1988, their shares were subject to a “dawn raid” by Jacobs Suchard AG, the Swiss chocolate and coffee company, who rapidly increased their shareholding from 15.8 to 22 percent during the day and made a takeover offer. Rowntree resisted the offer and approached Nestlé, from whom they had had previous offers. In the end, Nestlé acquired Rowntree for $4.5 billion. Smarties became and remains a household name in Britain, and the little multi-colored, oblate spheroids can be found everywhere. They are sold practically everywhere in the world outside the U.S. and form a significant part of Nestlé’s confectionery business.
The Mars company also thrived after the dissolution of the bond with Hershey, diversifying into parboiled rice products in 1947 (Uncle Ben’s) and other areas. It took Hershey the best part of a decade to realize that Mars was not going away any time soon and to catch up with them in the confectionery marketplace. The ’80s and ’90s saw the two companies vying for top market share in confectionery. Though not quite so well-known outside the Americas, M&Ms have nevertheless proliferated profitably, especially where U.S. troops have been stationed. In 2021, the Mars group was valued at $35 billion and remains a private company owned by the Mars family.
© David Cuin 2022