John Rockefeller Essay, Research Paper
On 18 March 1859 several months before his 20th birthday — Rockefeller goes into business for himself forming a partnership with a neighbor, Maurice Clark. Each man put up $2000 and formed Clark & Rockefeller commission merchants in grain, hay, meats, and miscellaneous goods. At the end of the first year of business, they had grossed $450,000 making a profit of $4400 in 1860 and a profit of $17,000 in 1861. The commission merchant business was very competitive and Clark & Rockefeller s success was due in large part to Rockefeller s natural business abilities.
During the Civil War their business expanded rapidly. Grain prices went up and so did their commissions. Most of their selling was done on commission so Clark & Rockefeller took no risks from price fluctuations. Rockefeller s style was very precise and calculated. He was not a gambler but a planner. He avoided speculation and refused to make advances or loans. (That is, advancing a customer money on produce before they received the produce and wrote up a bill of lading.)
Rockefeller was extremely hard working. He traveled extensively drumming up business throughout Ohio and then would go to the banks and borrow large sums of money to handle the shipments. This aggressive style built the business up every year.
However, by the early 1860s Rockefeller realized that the future of the commission merchant business in Cleveland was going to be limited. He had become convinced that the railroads were going to become the primary means of transportation for agricultural commodities. This would be to the disadvantage of Cleveland because its position as an important Lake port was its primary transportation advantage. He saw that the rising grain output of the Midwest and the Northwest of J. J. Hill would change the nature of the business for good. The huge elevators on Lake Michigan and the flour-millers of Minneapolis would be the dominant players in the business. Rockefeller came to believe that the future of Cleveland lay in the collection and shipment of raw industrial materials — not agricultural commodities. This would allow Cleveland to exploit its geographical advantages mid-way between the Eastern seaboard and Chicago and access to both rail and water transportation. He saw his chance in 1863 oil.