Gustavus Swift

Gustavus Swift was born June 24, 1839 in Sagamore, Massachusetts. Swift was part of a large family, being one of twelve children. He was introduced to the meat-packing industry at a very early age; his father and several brothers were modestly successful butchers. At the age of sixteen, Swift wanted work as a butcher independently, so he decided he would move into the city to start work. Swift's father did not want him to leave home, so he offered him twenty-five dollars to stay and start his butchering business from the small town where he grew up. Swift took the offer, and used his start up capital to buy his first cow for twenty dollars. He slaughtered and sold cut meats out of the back of his father's wagon, making a modest profit. This would be the beginning of Swift's prominent career. He recognized just how easy it was to simply buy livestock, butcher it, and sell the cuts for a profit. The process was very simple. Swift repeated this process for several years, before attaining a four-hundred dollar loan from his uncle. He used this loan to open a local market in his hometown, where he got experience in retail. Although he was making a decent living in Sagamore, Swift had an appetite for success.

In 1869, Swift moved to Clinton, Massachusetts, and became business partners with James Hathaway, forming the partnership Hathaway & Swift. Hathaway and Swift were very different individuals. Hathaway was about fifteen years older than Swift, and had considerably more experience in the meat industry. Hathaway was also much more conservative and less willing to accept risk in business ventures. Swift was the exact opposite. Any opportunity where risk or innovation could lead to profits, Swift would jump in head first. These contrasting personalities would soon lead to the end of their business relationship.

Swift was always looking to improve inefficiencies in his industry. He paid specific attention to the supply chain that provided livestock. Originally, cattle was purchased out West in areas such as Chicago, and shipped live to the East where population was concentrated. Swift saw this process as wasteful and inefficient for several reasons. First and foremost, he objected to the weight of live cattle. At the time, freight charges on railways were determined by weight. Generally, a boxcar of live cattle ran about one-thousand dollars. Swift's problem with this was that he was only using 40% of the cattle (the other 60% was at the time useless and discarded) while he was paying for the entire animal. In addition to unnecessary freight costs, was the amount of cattle that was lost in transit. For every boxcar stuffed with live cattle, there would be a certain amount of those cattle that were useless upon arrival. Some cattle would lose weight, decreasing the amount of usable meat, and some cattle would become sick, or even die. Another cost that Swift incurred was the feeding cost of keeping cattle alive and healthy. With all of these inefficiencies, Swift saw the opportunity to reduce costs significantly.

Swift wanted to shift their operation West, slaughter the cattle there, and freight the "dressed" or cut meat East, therefor reducing transportation costs. Hathaway strongly disagreed with this proposition, pointing that it was "too radical a change"(source). This idea of selling meat in the East, when it was butchered a thousand miles away was unheard of. This disagreement led to the separation of Hathaway & Swift, and in 1874, Swift bought Hathaway's share of the company for $30,000.

In the beginning of 1875, Swift moved his operation to Chicago, Illinois, where he purchased a slaughterhouse and opened Swift & Co. Swift greatest contribution to the industry started here. Swift & Co. became the first industry to utilize a moving line of production. Overhead conveyors carried carcasses upside-down along a series of workers who would clean and butcher the meat, eventually reaching a refrigerated storage room. This "disassembly line" was the first in any industry (soon to be made famous by Henry Ford, only backwards). One important thing to note about Swift's line of production was that it was labor intensive. Mechanization of the disassembly process was limited, due to the raw materials used: cattle, hogs, and sheep. Livestock of this sort varied in size, shape and weight, making it nearly impossible to develop machinery that could adjust to individual animals. Not only did the "disassembly line" reduce costs, and increase production, it also allowed for the creation of by-products (mostly cattle). As mentioned earlier, only 40% of a cow was butchered into cut meat. The line of production allowed the remaining 60% of the cattle to be made into a variety of products: glue, soap, fertilizer, leather shoes, baseball covers and mitts, and even red