George Ludlum Hartford - Biography

Biography

Hartford was born in Brooklyn, New York and was the second child and first son of George Huntington Hartford (1832 - 1917) and Marie Josephine Ludium (1837 - 1935). George Sr. was a bookkeeper for the recently formed Great American Tea Company, a retailer of tea and coffee in Manhattan that ultimately became the "Great Atlantic and Pacific Tea Company". Two years later, he was promoted to cashier and the family moved to Orange, New Jersey. At age 13, George Jr. started working for A&P on evenings and weekends while attending Saint Benedict's Preparatory School in Newark, New Jersey. 1878 became a momentous year for the Hartford family when A&P's founder, George Gilman retired and left the management of the 70 store chain to George Hartford Sr., who now received half of the profits from the company. Hartford Sr. was also elected Mayor of Orange, New Jersey and served in that position until 1890. George Jr. finished school and started working for the company full-time as a cashier in a nearby store in Newark, New Jersey.

In the early 1880s, A&P only sold tea, coffee and sugar at their stores, and the concept of a chain grocery store had not yet emerged. Young George convinced his father to add baking powder to the product line, starting the company down the path to increase the number of items offered until ultimately A&P's became the first chain to operate grocery stores. By labeling the product under the company's name, George also started the trend of chain stores marketing products under their own private labels. Over the next decade, the company added other private labeled products such as condensed milk, spices, and butter. By the end of the century, the firm's sales reached $5 million from 198 stores as well as its mail order and wagon route operations.

In 1901, George Gilman died and George Sr. negotiated a settlement with the estate that allowed him to control all of the voting stock and eventually repurchase the preferred shares from the Gilman heirs. The Hartfords moved aggressively to expand the enterprise, opening a new store every three weeks. In 1907 or 1908, George Hartford Sr. divided management responsibilities among his sons with George Jr. controlling finance and John directing sales and operations. The two ran the company as a team for over 40 years. In 1912, John proposed to create small economy stores to cut costs and increase volume by offering low prices. The concept was successful and by 1915 the chain operated over 1,600 stores. When George Sr. retired in 1916, George Jr. became Chairman in addition to Treasurer.

George Jr. lived with his parents until 1908 when he married a widow, Josephine Burnet Logan (1861 - 1944) and moved to Montclair, New Jersey. George and Josephine raised her daughter, Mabel and did not have additional children. He was a private individual who lived modestly despite his wealth. George never had a passport and did not travel except to vacation on the New Jersey shore. He rarely attended social events. His one passion was automobiles, which he took apart and reassembled to see how they worked. George also drove himself to his office.

After World War I, A&P rapidly expanded and by 1925 operated 13,961 stores with sales of $400 million and profit of $10 million. John convinced George to decentralize management into regions but George insisted that headquarters retain control of finances, real estate and purchasing policy, the areas he personally managed. The company introduced larger "combination stores" including space for meats, produce and dairy as well as traditional grocery items and launched a new drive to reduce costs. By 1930 the company's 16,000 stores reached sales of $1 billion.

Because George was opposed to borrowing and John insisted on maintaining low costs and prices, A&P was in excellent position to weather the Depression and reported even higher sales and profits. A&P's success strengthened the opposition of small independent grocers and their political allies. In 1935, Texas Congressman Wright Patman introduced legislation to place a significant federal tax on each chain store. If adopted, this legislation would have put A&P out of business. George and John Hartford took the unusual step of publishing a long letter pointing out that the effect of Patman's legislation would be a significant increase of food prices. The tide of public opinion turned against the bill.

Meanwhile the supermarket revolution was taking place in grocery retailing. A few operators experimented with large self-service suparmarkets that proved successful. A&P held back until 1936 when the brothers agreed to try the concept. By 1938, the chain operated 1,100 of the larger stores. The chain continued to rebuild itself so that by 1950 A&P operated 4,000 supermarkets and 500 smaller combination stores. Sales reached $3.2 billion with an after tax profit of $32 million.

George and his brother John were deeply hurt when they were convicted in Federal Court in 1945 for criminal violations of the anti-trust laws. President Roosevelt's anti-trust division charged that the combination of the company's manufacturing, distribution and retail operations, if unchecked, would drive all competition out of business. The company countered that its market share was only in the 15% range and that its low cost strategy had resulted in a significant improvement in that nation's nutrition and standard of living. The court agreed with the government and fined each of the brothers $10,000. In 1949, the U.S. Court of Appeals upheld the decision and the anti-trust division asked the court to break up the company Thousands of letters poured into the Justice Department supporting the company and the Hartford brothers gave extensive interviews with Time which put them on the magazine's November 13, 1950 cover. The case dragged on until the more business friendly Eisenhower Administration that dropped its demands to break up the company.

John Hartford died suddenly in 1951 and was replaced by the company's longtime Secretary, Ralph Burger. Now in his 80s, George remained as A&P's Chairman and Treasurer. Berger was a strong staffer who lacked John Hartford's strategic marketing skills. A&P continued to report record sales but made strategic mistakes that would ultimately cost the company its leadership position in 1974.

In 1957, George L. Hartford died at his home and was buried in Montclair next to his wife. Because he was the last survivor of his siblings, his father's trust was dissolved. Most of his estate was left to the Hartford Foundation.