Soup Stock

The U. S. was never a nation of soup-makers like the French, and whatever little native soup tradition did exist, largely disappeared after the late Dr. John Thompson Dorrance put soup into a can. For years & years Campbell Soup Co. made virtually all the canned soup sold in the U. S. During Depression, inspired perhaps by repeated press references to the $150,000,000 Dorrance soup estate, other soup-makers belatedly caught on to the profit possibilities of soup.

Though Campbell still sells an over whelming proportion of soup, H. J. ("57 Varieties") Heinz Co. can now claim the perfectly respectable title of No. 2 U. S. soup-maker. George A. Hormel & Co. is No. 3. Heinz and Hormel soups differ from Campbell's in two important respects: 1) they are not condensed, are served without dilution; 2) they cost more. Most Campbell varieties retail for from 10-c- to 11-c- per can or three for 25-c-. Heinz and Hormel soups, which come in larger cans, seldom get below two for 25-c-.

Only company to imitate Campbell's condensed soups in a big way was Phillips Packing Co., a smallish, flamboyantly aggressive concern with headquarters in Cambridge, in the heart of Maryland's fertile Eastern Shore vegetable belt. Phillips not only crashed the U. S. soup mar ket with a condensed soup; it sold it at a new low of 5-c- per can.

Last week Colonel Albanus Phillips, the company's big, bluff founder-president, let the public in on what has always been a family-&-friends affair. Small issues of common and preferred stocks were offered by the Manhattan firm of Lehman Brothers. Out of the total proceeds of $1,895,000, about $1,200,000 will be used to pay off notes and bank loans, presumably incurred to finance the 5-c- soups. Balance will go into expansion, working capital, possibly introduction of a new brand of canned dog food.

Before Phillips celebrated what it was pleased to call its "Third-of-a-Century" anniversary last year, the company was primarily a vegetable packer with soup as a sideline. Publicity was largely confined to the personal activities of Colonel Phillips, who is a sedulous hunter, a determined Republican and a firm believer in the virtues of Horatio Alger. On one occasion when a Texas friend lost his favorite dog, Colonel Phillips dispatched a "blue-blooded" Irish setter to replace the loss, shipping the animal in a special plane piloted by "America's Flying Stenographer." Even better publicized was his wager of a diamondback terrapin dinner that Walter P. Chrysler could not raise ten tons of tomatoes on one of Mr. Chrysler's neighboring acres (TIME, Nov. 26, 1934). Mr. Chrysler lost. Lately the Colonel's large face and broad shoulders have been appearing in Phillips soup advertising in the same way that Mr. Chrysler's face is seen peering into automobiles in Chrysler advertisements.

Revealed for the first time last week. Phillips' income statements clearly registered the rise of 5-c- soups in the past two years. Sales climbed from $5,800,000 in 1933 to more than $9,000,000 in 1935. But Colonel Phillips was not able to convert much of that gain into profits. They rose only about $123,000 above the $605,000 reported in 1933. Gross margin of profit increased, but overhead and selling expenses nearly doubled, presumably because of 5-c- soups.

Most distinguishing feature of the Phillips business is the fact that it buys tin plate, makes its own cans. About 85% of the Phillips cans are used in its 14 packing plants, the rest sold outside. Campbell's cans are made by Continental Can, which has a plant next door to the big soup works in Camden, N. J., rolls the cans on to the Campbell conveyer belts automatically.

Phillips' assets foot up to more than $5,000,000, including two curious subsidiaries, Bloodsworth Island Game Pre serve, Inc. and Phillips Athletic Association, Inc. Chief asset of the Athletic Association is a company ball team called the Phillips Delicious Soup Makers. A promotional monthly distributed to deal ers, jobbers and retailers is named P. D. Q. (Phillips Delicious Quality).

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