The Ice King | Slippery Business | 3

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0:56Imagine it's December 1816 in the State House in Columbia, South Carolina. You're sitting at a long table with five other members of the State Trade Committee, working your way through a stack of papers and permits that have been sent for your review. You stifle a yawn as you pick up yet another document from the pile. But just then, an attendant enters the room and informs you that there's a gentleman from New England asking for an audience with the committee. You nod to the attendant, who steps out and returns with a weary-looking man with dark circles under his eyes. He wipes his nose with a handkerchief as he takes a seat across from you.

1:32You reach across the table and shake his hand. Well, welcome. I was informed that you've only recently arrived in our fine city. I hope the journey went well. I can't say it did. A week by sea from Boston to Charleston, followed by three miserable days on rutted roads to Columbia, and I managed to catch a terrible cold along the way. You'll have to excuse me. I haven't slept a wink in two nights. Oh, I'm sorry to hear that, but I guess you're here now. What brings you before our committee today? My name's Frederick Tudor. He pauses, clearly expecting some reaction from you, But you've never heard of him.

2:08After a second, Tudor frowns. The ice trader? Out of Boston? You look down the table at your colleagues, but there's no hint of recognition from them either. I'm afraid, sir, we're not familiar. Well, let me enlighten you then. For the last ten years, I've exported the purest New England ice to the islands of the Caribbean. It's transformed people's lives in the tropics. Imagine being able to drink chilled water on a scorching day. Cubans have even developed a taste for ice cream. At that, your curiosity stirs. You know, I once had ice cream in London. Quite the novelty. Are we to understand that you're here today because you wish to import ice into South Carolina?

2:46That's exactly it. And as a first step, I intend to build an ice house in Charleston, a structure that will keep my product frozen for weeks. Well, very well, Mr. Tudor. Thank you for informing us. We look forward to following your progress and maybe eating an ice cream next summer. Tudor wipes his nose with his handkerchief again. Excellent, excellent. I'll begin construction as soon as I receive the license. I only sell ice in regions where I have the exclusive rights to import it. You hear one of the other committee members mutter something under his breath. Oh, I'm sorry, Mr. Tudor, but that's not within the power of this committee to grant you a monopoly.

3:23Tudor closes his eyes, pinching two fingers to the bridge of his nose. I'm going to build an ice house, ship frozen water 1 ,000 miles by sea, gamble thousands of dollars to introduce a new product to your state, yet you aren't willing to do one small thing to help? Well, Mr. Tudor, this is the United States. We don't restrict trade. We don't place artificial barriers to stop competition. That isn't the American way. Tudor rises and then stops back toward the door. Well, then I will go elsewhere, find a more amenable market, And then I'll make a fortune, because that's the American way. Tudor slams the door on his way out of the room.

4:02You look around at your fellow committee members, who appear just as bewildered by this interaction as you are. Then you can't help but laugh at the sheer gumption of him asking for a state-licensed monopoly for something as bizarre as ICE. You've met your fair share of eccentric businessmen over the years, but Frederick Tudor might just be the oddest one yet.

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5:52By the winter of 1816, ice trader Frederick Tudor had spent nearly a decade shipping ice from New England and selling it in Cuba. But after ten years of time and effort, Tudor was far from wealthy. He'd suffered numerous setbacks over the years, and time and again his profits had been erased. Just a year earlier, in 1815, a cargo of tropical fruit he'd hoped to successfully import to New York went rotten during the voyage, leaving him with barely enough money to tide him over until the following winter. But a fortuitous meeting with a family friend soon gave Tudor an idea. While Tudor had previously only exported to the Caribbean, now he began making plans to expand his trade network to the American South.

6:35In pursuit of his new goal, Tudor traveled to South Carolina in December 1816. But by the time he arrived, he was suffering from a head cold that left him short-tempered. And when the state's trade committee refused to grant him the monopoly he requested, Tudor threatened to take his trade elsewhere and stormed out of the meeting. But he soon backed down on his threat, convinced that South Carolina was the best place to launch the ice trade in America. And although he didn't realize it at the time, the committee's decision would turn out to be a blessing in disguise. By forcing Tudor to revise his whole approach to the ice trade, the people of South Carolina would finally put him on a path to prosperity.

7:14This is Episode 3 in our four-part series on the Ice King, Slippery Business.

7:23In December 1816, just days after being rejected by the South Carolina Trade Committee, Frederick Tudor decided to press ahead with his plan to expand his business into the American South anyway. So he proceeded to hire laborers to build him an ice house in South Carolina's largest port, Charleston. At the time, Charleston was a bustling city of more than 20 ,000 people. Merchant ships crowded the harbor, loading cotton from vast plantations around the state. Other traders specialized in a different cargo, enslaved Africans, many of whom were sold at auction before being loaded onto carts and transported to work the fields.

7:59Others remained in the city, forced into domestic service or to labor in workshops and factories. Tudor accepted slavery as part of the economy of the southern states, and although he showed no interest in making money from the slave trade himself, he was happy to pursue his other commercial ambitions in the region. Still, the refusal of the state trade committee to grant him a monopoly posed a serious risk to his planned expansion. In the past, Tudor had insisted on getting the exclusive rights to import ice before he began trading in any particular territory. He worried that competitors would see what he was doing and muscle in on the trade.

8:34It was a fear that had already come true twice before while trading in Cuba. But both times, Tudor had managed to defeat his rivals by undercutting their prices, but the experiences had left him wary. Now, Tudor had to accept that he would not receive an exclusive license in South Carolina. In response to this setback, he decided to shift his business model and drop his prices from the start in the hopes of preventing potential rivals from even starting to challenge him. So while he'd previously charged 16 cents a pound for his ice in Havana, in Charleston he fixed the price at half that amount, just 8 cents a pound.

9:09But there was a catch. Lowering his prices would mean that Tudor had to sell more ice in order to make a profit. And to achieve higher sales, he knew he would need to spark enough demand that ice became a commonly purchased product, not just an expensive luxury good available only to the wealthy. So Tudor focused on marketing his ice as a product for everyone. In ads he placed in Charleston's newspapers, he printed a recipe for homemade ice cream. He told barmen how to mix ice-based cocktails and promoted ice to physicians as a method of cooling fevers. Residents of South Carolina had never stored ice before either, so Tudor taught them how to make it last.

9:46He sold blankets for$1 apiece, explaining to customers that they should wrap their ice to insulate it on the journey from the ice house to their homes. And for a slightly higher price, customers could buy their own wooden, iron-lined icebox that could keep three pounds of ice frozen for several days. And for a subscription of$10 a month, Tudor would even deliver fresh ice directly to the customer's door every few days. It didn't take long for Tudor's aggressive marketing campaign and new pricing strategy to work. While the wealthy residents of Charleston were certainly eager to try New England ice, even the city's enslaved workers and domestic servants, most of whom had just a few cents, lined up to buy ice at Tudor's reasonable rates, so that during the spring of 1817, he sold more ice in Charleston than he did in the well-established market of Havana.

10:35Tudor was thrilled that his strategy had paid off. Even though prices were lower in Charleston, the higher volume of sales meant he made more money. In fact, Tudor discovered that sales were so strong that demand outstripped supply. Usually, he sold the ice that he had harvested from lakes and ponds in New England until he ran out of stock. He then waited until next winter's freeze when the process of harvesting began again. But in 1817, Tudor sold so much ice in Charleston that he depleted his ice stores far earlier than usual. This premature end to the trading season spurred him to try and solve the issue of limited supply.

11:11And Tudor soon identified the problem. There simply wasn't enough storage space in his Boston ice houses to hold the quantity of ice he needed to keep both Havana and Charleston supplied. So Tudor arranged for more ice houses to be built close to Boston Harbor. These new warehouses enabled Tudor to hold stock in reserve and redirect it where it was needed, meaning he would no longer be forced to end a trading season early because he'd run out of ice. This increased storage space also gave Tudor the opportunity to expand his business even further. With enough ice in reserve to supply another market, Tudor's eyes wandered across the map looking for another suitable city in the American South.

11:49It didn't take him long to land on another bustling commercial hub, Savannah, Georgia. Like Charleston, Savannah was a coastal city with a thriving port and a growing population. But Tudor lacked the capital to launch a large-scale operation in Savannah. He did, however, have enough spare cash to build a small, temporary ice house close to Savannah Harbor. And with that ice house in place, in the spring of 1818, Tudor arranged for a shipment of a few dozen tons of ice from Boston. Then, following his now tried-and-true approach, he placed ads to inform the people of Savannah that there was a new product in town and tried to spark demand while keeping prices as low as possible.

12:28Before long, he found he was even more successful in Savannah than he could have dreamed of. His shipment of ice ran out within days, and Tudor felt confident enough to begin building a permanent ice house that would be operational for the following year. By the beginning of 1819, Tudor could look back on his best 12 months yet. He had a steady income from Havana. Charleston was a roaring success, and Savannah looked set to replicate it. He had sufficient ice houses in Boston to hold his supply, and they were ready to be filled with another winter's worth of New England ice. Everything seemed to be going well, but Tudor soon realized there was something fundamental to the ice trade that he couldn't control—the weather.

13:07For years, Tudor had been a consummate note-taker. He filled pages of what he called his ice house diaries with observations, temperature records, ice depths, and financial transactions. But in early 1819, as he jotted his daily notes, he realized he was facing an unprecedented situation. New England was in the midst of an ice drought. In the winter, to form export-grade ice, New England's temperatures needed to drop below 30 degrees Fahrenheit for at least a week. The ice layer of a lake or pond needed to reach a depth of 18 inches to even begin collecting it. Typically, Tudor's harvesters got to work in January and continued through March.

13:45But by late February 1819, Tudor had to face the fact that barely a single day had dropped below freezing. A brief, belated cold snap finally allowed him to fill some of his newly built ice houses near Boston Harbor, but he knew this meager harvest wouldn't be enough to keep all three of his markets supplied for the entire summer. So after a year of unprecedented success, Tudor was now at a loss as to how he could procure the amount of ice he would need to satisfy his customers. He finally had the demand he dreamed of, but now his supply fell short. Then a thought occurred to him. He would turn to the sea.

14:21Tudor learned that the mild winter combined with winter storms meant that more icebergs than usual were breaking off in the ice sheets of the Arctic. As the giant mountains of ice slowly drifted south, transatlantic shipping spent the summer dodging them. Most captains took a more southerly course to avoid the icy obstacles, but Tudor resolved to send ships straight for them.

14:46Imagine it's September 1819 in the North Atlantic Ocean. pull your coat tighter as wind whistles across the deck of your trading ship, the Retrieve. Normally, in merchant shipping, time is money, but right now, the Retrieve is motionless in the ice fields of the North Atlantic, and the stillness makes you uneasy. A few weeks ago, Boston ice trader Frederick Tudor hired you and your ship for an unusual mission, to sail into the North Atlantic, find an iceberg, and harvest ice straight from the sea. It's a task unlike any you've ever had before, and it's made your chief mate anxious. Captain, do you think we should pull the men off the iceberg?

15:23The hold's looking pretty full to me. Are we at capacity? Not quite, but like I said, we've got a good load. Well, if there's space in the hold, we keep working. Mr. Tudor hasn't paid us to return with a half-empty ship. Aye, sir, but the iceberg, it's looking unsteady. You look at the frozen Colossus towering over the deck. A dozen sailors have climbed it using ropes and ladders, and they're hacking at it with pickaxes and saws. Blocks of ice swing through the air as they're lowered to the deck. The men looked nervous, but the iceberg seemed stable enough, so you shake your head. No, look, I don't like this job either, but we're not leaving until it's done.

15:59Continue until the hold's full. Very well, sir. Still, it seems crazy that this ice is going to end up in Cuba, right? In Charleston and Savannah, too, I hear. What a funny world we live in. Just then, a ladder balanced against the iceberg suddenly falls to the side. Another creaks and starts to slide. Your eyes snap back to the top of the iceberg, and you suddenly realize that the chief mate is right. It's tilting in the water. Oh no, alright, get the men off there now. The chief mate shouts frantically to the men to get down, and in moments sailors shimmy down the ropes and descend ladders onto the deck.

16:33You signal to the sailor at the wheel. Quickly, push away! The ship inches away from the iceberg, but it's not moving quickly enough. The iceberg tilts further and then begins to roll. The ship jolts as the ice scrapes along the hull, and the mate leans over the rail. Captain, we've been struck! I'm in the pumps. Raise the sails. We're getting out of here, full hold or not. I'm not going under for the sake of a few tons of frozen water. When you're safely clear, you personally examine the damage. The iceberg has torn a large gash in the retrieve, but luckily, the hull is above the waterline. With emergency repairs, you'll be able to limp back south with the ice your crew has already cut.

17:15Still, as you watch the shimmering iceberg recede into the distance, one thought settles in your mind. This will be the last fool's errand you ever run for Frederick Tudor.

17:27For the crews brave enough to take it on, hacking ice off unstable icebergs in the frigid open ocean was perilous work. But after they returned to Boston Harbor with full holds, Frederick Tudor paid them handsomely for their efforts. It was a premium he was willing to pay, because the unprecedented shortage of ice in New England that winter meant that these emergency supplies from the North Atlantic were his only hope for keeping his trade alive. For Tudor, though, survival was never enough. Adding new ports to his routes had paid off, and now he was hungry for more. But his next ventures would test him like never before, because in the ice trade, even the best-laid plans were at the mercy of forces far beyond anyone's control.

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19:23By the summer of 1819, Frederick Tudor's fortunes were again on the rise. Havana was providing a stable income stream. Charleston was as lucrative a market as it had been the previous year, and the first full trading season in Savannah was just as rewarding. Tudor had built a new ice house there that could hold 200 tons of ice, an amount he boasted was large enough to keep all Georgia cool for some time. And he was right. The new ice house didn't just hold enough to serve the inhabitants of Savannah, but the whole state. Because Savannah sat at the mouth of a sprawling web of rivers, it was the hub of a regional trade network.

19:59Local merchants were able to buy Tudor's ice in bulk, load it onto riverboats, and transport it all over the state, spreading chilled goods well beyond Savannah's city limits. And despite being wary of competition, Tudor didn't mind the local merchants building on his success. He didn't have the manpower or means to reach every city, town, and village himself, and he reasoned that the rising demand only strengthened his position. As long as no one tried to compete directly and impose on his territory by importing ice from Boston, he was content, and thanks to his low prices, no rival dared to try.

20:34By the end of that summer, Tudor's stocks of ice had been exhausted, and thanks to his robust sales in Georgia, he was finally back in the black. He was even able to repay his long-standing debts, so for the first time in more than a decade, he could return to Boston without looking over his shoulder. Still, Tudor wasn't prepared to take any more money out of his company than was necessary. He intended to use his profits to keep expanding, and he soon got another opportunity. A fellow Boston merchant named Stephen Cabot approached Tudor with a bold proposal. He wanted to partner to re-establish the ice trade on the Caribbean island where it was born, Martinique.

21:12Tudor's first attempt to export ice from Boston to Martinique 12 years earlier had been an expensive failure. He had no ice house on the tropical island at the time, and his first shipment had melted quickly, as the inhabitants of Martinique had shown little interest in purchasing a product that melted within hours of buying it. But Tudor felt he had learned a great deal since then and decided the time was right to try again. So he arranged to put up some of the money he'd made over the previous year, while Cabot found someone else willing to match the investment. Tudor then used the combined capital to order the construction of an ice house on Martinique and hired a ship to carry a cargo of ice.

21:50Meanwhile, Cabot traveled to the island to act as the ice house manager. But almost immediately, cracks appeared in the partnership. In Charleston and Savannah, Tudor had succeeded by marketing ice to ordinary people as an everyday necessity, not a luxury. He kept prices as low as possible and sold in volume. But once in Martinique, Cabot didn't stick to Tudor's proven methods. Instead, he charged a high price for the ice in hope of making more money on each sale. But just as Tudor had found on the island more than a decade earlier, inhabitants of Martinique were not interested in paying top dollar for a product only to see it melt within a day or two.

22:27So upon hearing of his partner's prices, Tudor wrote to Cabot, urging him to change course. He explained the techniques he used to spark demand elsewhere, how he'd printed recipes for ice cream, and sold blankets and ice boxes so customers could keep their ice cool after purchasing it. He explained how he offered ice to bars and restaurants at little more than cost to get patrons hooked on chilled drinks. But Cabot ignored all of Tudor's advice. Instead, he buried his disappointing sales figures in optimistic letters and reports. he declared that he'd turn the situation around. According to him, lines formed every day outside his Martinique ice house.

23:04Cabot even claimed that demand was so high that they should build another ice house on the neighboring island of St. Thomas. That way, Tudor's ships could drop off at two different stops in one voyage, sharing transport costs while tapping into a wider Caribbean market. And at Cabot's urging, Tudor agreed to fund the construction of the St. Thomas ice house. Then he waited for the money that Cabot had promised would follow, but it never came. In reality, sales in St. Thomas were just as poor as in Martinique, and the stock had slowly melted before it could be sold. Worse still, Tudor had precious little ice to spare after the previous winter's weak harvest, meaning Cabot was wasting product that Tudor couldn't afford to lose.