Web Page No 2476
19th May 2018
First Picture: An early Smiths Crisps Packet
Second Picture: An Early Advert
Third Picture: 1960’s advert
Fourth Picture:
A tin of
Crisps!
Crisps
Now here is something to get all nostalgic
about, those strange packets of Penny Crisps. From memory these were filled
with broken crisps and crisp pieces but were half the price of the normal
packets of Smiths Crisps. Smiths were the only manufacturer in those days.
The normal packet of crisps, as can be
seen from the illustration, cost 2d a packet so the 1d packets were a great
saving and I am sure that my local tuck shop, Shaw’s on the corner of Highlands
Road and Solent Road must have sold hundreds of them, if not thousands. These
1d packets were easily identified as they came in the usual greaseproof packet
with printing on them but whereas the normal packets had coloured printing on
them, the 1d ones were only printed in black. Unfortunately, I have yet to find
a picture of those 1d packets.
Today, Walkers dominates the British crisp
market, this wasn’t always the case: Smith’s Crisps supplied almost every pub
and hotel in Britain in 1949.
Frank Smith (1875 – 1956) began his career as an apprentice grocer in
London. He was promoted to manager of a small crisp department at a Smithfield
wholesale grocers. He entered crisp manufacture for himself from 1919,
raising £10,000 with two friends.
The first factory was a disused garage in Cricklewood. The fledgling
business had a staff of twelve in 1920. The enterprise proved successful enough
that Smith only had to spend £6,000 of his initial capital: further expansion
was funded entirely from profits. Additional factories were opened in
Portsmouth, Birmingham, Paisley and Stockport in 1921. Smith’s Potato
Crisps went public in 1929, by which time there were seven factories.
All of the early output went to hotels and pubs, and this would
remain the largest market for Smith’s until the 1960s.
By 1934, 200 million packets of crisps were sold in Britain each year,
95% of which were manufactured by Smith’s.
To ensure supply, Smith’s acquired 8,000 acres of farmland in
Lincolnshire, which provided around10% of the company’s potato
requirements. Due to crop rotation, only between 1,000 to 1,200 acres were used
for potato production at any one time. It was the largest farm under
single management in Europe.
During the Second World War the majority of production went to the
military.
By 1949 Smith’s had eleven factories and twelve depots in Britain,
and two factories in Australia. Over 2,000 staff were employed. The vast
majority of pubs and hotels across Britain were supplied by Smith’s Crisps.
This was at a time when pubs did not serve food, and crisps were generally the
only bar snack available.
The company was producing over ten million packets of crisps every week
by 1956. Net profit after tax exceeded £1 million for the first time in 1960.
Smith’s acquired its major rival, Tudor Crisps, in 1960. Tudor was
in the process of constructing a large new factory at Peterlee, County Durham,
and Smith’s was keen to prevent a rival gaining control of the new site.
Smith’s was the only national brand at the time, but Tudor enjoyed
distribution in Scotland, the North of England and the Midlands. Founded
in Newcastle upon Tyne in the late 1940s, Tudor was the first company in
Britain to use automated crisp manufacture, and had brand leadership in the
North East of England. It had a labour force of 160. The Tudor acquisition
helped Smith’s achieve a market share of 65% in 1961, of which
Tudor accounted for three to five%.
Golden Wonder had been founded in 1946 by William Alexander, an
Edinburgh baker. The company was acquired by Imperial Tobacco in 1960.
Imperial built three large new factories and promoted the product
heavily on television. A cellophane bag was introduced to keep crisps fresher
for longer. The brand went nationwide in 1964. Golden Wonder’s market share
overtook Smith’s by the end of 1965, and by 1966 they had a market
share of 45% against Smith’s 34%.
Golden Wonder appealed to teenagers and children, but especially
housewives. This meant that Golden Wonder was growing the market, rather than
poaching Smith’s customers. As Smith’s did not monitor its competition,
it did not become aware of a problem until 1966, when its sales
fell slightly. Meanwhile, the grocery store market was growing whilst
Smith’s pub snacks market declined.
In 1967 the Peterlee plant was expanded to 150,000 square feet to
produce eight million packets of crisps a week. By this time it employed
500 people and was one of the most efficient crisp factories in
Europe. There were also factories in Belgium, Holland, Ireland and France,
as well as Australia. By this time the number of British factories had been
reduced to seven.
In 1967 the company name was changed to Smiths Food Group, to reflect
wider participation in the savoury snacks market, such as roasted peanuts.
Company focus was switched from production to marketing.
The company’s first flavoured crisp, Salt ‘n’ Vinegar, was launched
by Tudor in Spring 1967, and the Smith’s branded version was
released two months later. It was the first time the now iconic British
crisp flavour was introduced. However, the flavoured crisp had been pioneered by
Tayto of Northern Ireland in the late 1950s.
1967 also saw Smith’s replace translucent paper with cellophane film
bags which increased shelf life from a few days to over six weeks.
Smith’s had long claimed to manufacture a high quality product, but
Golden Wonder achieved higher standards with the continuous batch process.
Growing Golden Wonder cost Imperial Tobacco £10 million, mostly in factory
costs, and due to a high marketing spend the business ran at a loss until
1965. Smith’s had presumed that the barrier costs of entry were too high
for a competitor to match. They were wrong and it cost them. Largely due
to these concerns, Smith’s was taken over by General Mills of America in 1967
for £15-16 million.
Smith’s introduced Quavers in 1968, and Monster Munch in
1977. These were part of the new “extruded snacks” category, which were
made using potato flour. (Golden Wonder launched Wotsits in 1970).
Meanwhile between 1962 and 1969, Walkers quadrupled its sales. In
1971 Walker & Son of Leicester sold the company to Standard Brands of
America.
In 1972 Golden Wonder had a market share of 39%, Smiths 32% and Walkers
12%. Still heavily regional, by 1974 Walkers claimed 50% of the Midlands crisp
market. Walkers was a premium product with a heavy marketing spend that
sold mainly to the wholesale trade.
Smith’s became loss-making under General Mills, who sold the company to
Associated Biscuits for £16.4 million in 1978, explaining that a British
concern would likely be better tuned in to the needs of the company.
Walkers and Smith’s were managed separately: Walkers was a high margin,
high quality regional product, but it suffered from a narrow product
range, poor trade relations and no innovation. Smith’s focused on low prices,
but this merely resulted in low profits.
In 1988 Smith’s had sales of £145 million; Walkers had sales of £114
million. Walkers Crisps alone had a 32% market share. PepsiCo, who owned
Doritos and Lay’s crisps in America, acquired Walkers and Smith’s for $1.35
billion in cash in 1989.
Walkers held 44% of the salted snacks market by 1995. Launched in
Scotland in 1994, by 1996 Walkers had displaced Golden Wonder as the
local market leader. Walkers acquired the Wotsits brand from the struggling
Golden Wonder for £150 million in 2002, following disappointing sales
of its own similar Cheetos product. Golden Wonder entered into
administration in 2006, a victim of the popularity of Walkers.
The Walkers site in Leicester produces more than 11 million bags of
crisps a day as of 2011.
But who can forget the little bag of
salt?
Keep in
touch
Yours
Peter
gsseditor@gmail.com
You Write:
News and Views:
On this day 19th May 1960-1965.
On
19/05/1960 the number one single was Cathy's Clown - Everly Brothers and the number one
album was South Pacific Soundtrack. The top rated TV show
was Royal Variety Performance (ATV) and the box office smash was Psycho. A pound of today's money was worth £13.68 and
Burnley were on the way to becoming the Season's Division 1 champions.
On
19/05/1961 the number one single was On the Rebound - Floyd Cramer and the number one
album was GI Blues - Elvis Presley. The top rated TV show was Bootsie &
Snudge (Granada) and the box office smash was One Hundred and One Dalmations. A pound of today's
money was worth £13.25 and Tottenham Hotspur were on the way to becoming the
Season's Division 1 champions.
On
19/05/1963 the number one single was From Me To You - The Beatles and the number one
album was Please, Please Me - The Beatles. The top rated TV show was
Conservative Party Political Broadcast (all channels) and the box office smash
was The Great Escape. A pound of today's money was worth £12.64 and Everton
were on the way to becoming the Season's Division 1 champions.
On
19/05/1964 the number one single was Juliet - Four Pennies and the number one
album was Rolling Stones - The Rolling Stones. The top rated TV show was Coronation Street (Granada) and the box office
smash was Dr Strangelove. A pound of today's
money was worth £12.24 and Liverpool were on the way to becoming the Season's
Division 1 champions.
On
19/05/1965 the number one single was Where Are You Now (My Love) - Jackie Trent
and the number one album was Freewheelin' Bob Dylan. The top rated TV show was Coronation Street (Granada) and the box office
smash was The Sound of Music. A pound of today's money was worth £11.69 and
Manchester United were on the way to becoming the Season's Division 1
champions.
