International Hat Company

International Hat Company
Formerly called
 International Harvester Hat Company
Private
Industry Hat Apparel
Fate Liquidated
Successor Venture Products, Inc.
Founded August 17, 1917 (1917-08-17) in St. Louis, Missouri, United States[3]
Founder George Tilles, Sr.
Defunct June 14, 1989 (1989-06-14)[4]
Headquarters 707 Locust Street, St. Louis, United States
Coordinates 38°37′45.7″N 90°11′28.3″W / 38.629361°N 90.191194°W / 38.629361; -90.191194Coordinates: 38°37′45.7″N 90°11′28.3″W / 38.629361°N 90.191194°W / 38.629361; -90.191194
Number of locations
 7 factories (1982)
Area served
 Worldwide
Key people
Products Military Pith Helmets, Sun Hats, Dress Hats, Baseball Caps
Number of employees
 1,500[5] (1982)
Parent Interco, Inc. (1975–1989)
Subsidiaries
Slogan Service Before Profit[3]

International Hat Company, formerly named the International Harvester Hat Company, was a St. Louis, Missouri based manufacturer of commercial hats and military helmets. The company is best remembered for its mass production of tropical shaped, military fiber helmets for soldiers of the United States Army, Marines, and Navy during and after World War II. However, the American owned company was also a major producer of harvester straw hats, fiber sun hats, enameled dress hats, and baseball caps throughout most of the 20th century.

Established in 1917 as a private corporation, the company began with a single product line of harvester hats.[3] By the 1930s, the company had expanded into fiber pressed sun hats.[3] During World War II, International Hat developed and produced several models of military pith helmets, including a model with rudimentary ventilation.[8] After the war, the company became interested in plastic molding injection, moving increasingly away from pressed fiber. In the 1950s, General Fibre Company, a subsidiary of International Hat, changed its name to General Molding Company to reflect these production changes in basic materials. By the 1960s, International Hat was mostly producing baseball caps, straw hats, plastic helmets, and plastic sun hats.

The company had a proclivity for building its factories in small rural cities, often becoming the largest employer and economic backbone of those communities.[9][10] On several occasions, International Hat donated land or facility equipment for the creation of municipal parks located adjacent to one of its factories, namely for the purpose of benefiting employees, their families, and the local community.[11]

After sixty-one years of business, the company was sold in 1978 to Interco, Inc., where it continued operating as a subsidiary.[12] In 1989, International Hat was subsequently sold to Paramount Cap Company, in a liquidation fire sale.[4] In an attempt to avoid a hostile takeover bid by Cardinal Acquisition Corporation, senior management hired Goldman, Sachs & Company to sell Interco's entire apparel division between 1988 and 1990.[13][14] This divestiture strategy was part of a larger $2.8 billion recapitalization plan, put in place in 1988, that led the parent company directly into insolvency.[5] Some financial scholars have considered this recapitalization plan to be among the worst business strategies in the US of the 1980s.[15][16] In 1991, Interco's earlier attempt to avoid a hostile takeover resulted in the bankruptcy of the company.[16] Several tens of thousands of jobs were lost across the country, as a consequence.

Although International Hat was liquidated in 1989, several of its original factories are still in operation by other hat companies in Southeastern Missouri.[4][17] Additionally, one of International Hat's warehouses in Soulard, Missouri has been added to the National Register of Historic Places.[1][18] International Hat operated the historical building from 1954 to 1976.[2] It is presently used as a senior and disabled living facility.[1]

History

First location and early company history

International Hat Company original headquarters in St. Louis, Missouri.[19] The company's original factory produced all World War II era military helmets manufactured by the company.

The company was founded on August 17, 1917 as International Harvester Hat Company.[3] A prominent St. Louis family, led by George Tilles, Sr., co-founded the company, with several other major shareholders, during the turbulence of World War I. However, Tilles left operational management of the company to his partners and his son, George Tilles, Jr.[20] In 1930, the younger Tilles was promoted to president of International Hat, where he served until his retirement.[20]

The original business model of the company was commercial hat production. On the micro-economic level, International Hat was established at the peak decade of the commercial hat apparel market. In 1910, 35 million hats were produced in the United States, an all time record for domestic production.[21] On the macroeconomic level, the company was founded at a time of ascendance for the United States. In 1916, the United States economic output, for the first time in history, was greater than that of the British Empire, establishing the United States as the world's largest economic superpower.[22] From World War I to the beginnings of the Great Depression, it was under these economic environmental conditions that the company originally produced a product line of harvester hats. Such hats of the period were a staple of farmers and field hands across the US.[20] With the rise of the automobile, fashions began to change. In 1931, the company expanded into men's straw dress hats to adopt to evolving fashion trends.[3] In 1938, the company name was changed to International Hat Company to better reflect the growing diversity of its product lines.[3] In 1940, the product lines were further expanded when International Hat began production of military pith helmets for the US military.[8] The war effort led to a realignment of production geared towards military apparel.[8]

Through the depression of the 1930s, President George Tilles, Jr. managed the expansion of the company's facilities from a modest 5,000 square foot factory to a modernized 150,000 square foot factory.[23] Under Tilles, International Hat saw increasing growth during World War II. By 1942, the company's operations had grown to include its main factory facility, several warehouses, two buying offices in Mexico, and a sales office in New York City.[3] The company was also importing goods from a dozen countries.[3]

New markets and expansion

Frank Pellegrino, CEO and Chairman (1943-1975), built five factories, created two municipal parks, and expanded the post-WWII product lines of the company into plastic helmets and baseball caps.

Following World War II, the International Hat Company entered an expansionist period with new markets, facilities, product lines, and basic materials. Frank Pellegrino served as Vice President under George Tilles, Jr., becoming President of International Hat from 1943 until his death in 1975.[20] Tilles placed Pellegrino in charge of opening a second factory.[11] In 1946, a new facility was constructed and operational in Oran, Missouri, becoming the largest employer in the city.[24]

Pellegrino managed International Hat into a company of over 1,500 employees with six domestic factories. During the 1950s and 1960s, International Hat expanded from its factory in St. Louis to include five other factories located in Southeast Missouri. A number of these locations became one factory towns. Additionally, a sixth plant was opened in Texas.[12] Reflecting this period of expansion into foreign markets, the company headquarters was also moved from St. Louis to New York City.[12] During this era, the company continued producing military helmets and straw hats. However, the company expanded its products lines into plastic hats and helmets, as an early entrant into this new consumer market. As press fiber waned, plastic allowed for more automated production and lighter materials, without the ventilation issues of pressed fiber trapping heat. Throughout the 1960s, the company began shifting into the baseball cap market.[9] In 1967, International Hat began its first consumer focused advertising campaign, to expand its reach in the retial sector, with advertising agency Stemmler, Bartram, Fisher & Payne.[25] In the 1970s, the company expanded into the winter apparel market, selling ear muffs manufactured by VIP Industries.[26]

Under Pellegrino, this would later prove as the height of the expansion of the company in terms of size, productivity, and financial success.

Sale, decline, and liquidation

Jean S. Goodson became President of International Hat in 1975, following the death of President and Chairman Pellegrino. Goodson began cutting down on the company's imports from the New York office and limiting the production of dress hats to focus on other product lines. Unsatisfied with his performance, the board of directors requested Frank G. Pellegrino, Sr., minority shareholder and son of the former President and Chairman, represent International Hat in pursuing the sale of the company. At that time, Pellegrino was President of General Molding Company, a subsidiary of International Hat, in the production of plastic molds for the parent company's hats and helmets. In 1977, Pellegrino initiated the sale of the company to Interco, Incorporated, a conglomerate of furniture, apparel, and shoe companies. On March 31, 1978, a special meeting of the stockholders was held to consider the terms by which Interco offered International Hat.[27] The stockholders accepted the deal and International Hat was officially sold to Interco by the end of the day.[12] The original shareholders were bought out and Jean Goodson continued on as President of International Hat as a subsidiary company of Interco from 1978 to 1989.[12]

As a subsidiary, International Hat continued operation until June 14, 1989.[28][29] The domestic hat apparel market had undergone a steady increase in global competition since the 1970s during a time of record sales of hats in the US.[30] The company was pressured by changing market conditions, particularly the US loss of market share from cheaper imports coming in from Brazil, Spain, Taiwan, and China.[15] In 1984, China alone exported 2.98 million dozens of hats to the United States.[4] By 1989, 6.5 million dozens of hats were being imported from China, representing 31 percent of the total market share of the hat apparel industry.[4] Demand for hats actually increased during this period, whereas the US market share of hats decreased from 27.1 percent to 22.2 percent from 1984 to 1989.[4]

However, the mortal blow to the company derived from a hostile takeover bid attempt of Interco. In a series of management decisions to avoid takeover, Interco's management sold off numerous holdings in shoes and apparel. Interco also over-leveraged its finances by raising cash in order to buyback stock.[31] The combination of managerial decisions quickly resulted in Inteco's bankruptcy.[32] In some business administration colleges, the collection of these managerial decisions has been used as a case study in strategic management, as an example of poor, ineffective, and short-sighted business planning.[33][34] With bankruptcy of the parent company a year away, International Hat was liquidated in a fire sale to Paramount Cap Company.[4]

Successors

The factories in Dexter, Marble Hill, and Oran were re-opened in May of 1989, after being sold in the liquidation to Paramount Cap Company.[4][17] The Dexter plant was shuttered in 2000 before being sold to Venture Products, Inc. and re-opened in 2001.[35] The factory in Oran was sold to Carr Textile Corporation, which was subsequently sold to Venture Products, Inc.[36] At present, the Oran hat plant is operational in the production of straw hats.

Products

Main article: Pith Helmet
International Hat Company pressed fiber pith helmet with ventilation holes; based on the 1940 design specifications.[37]
International Hat Company pressed fiber pith helmet interior.

International Hat produced a variety of products over eighty-three years of operations. However, it is most well known for its production of several different models of fiber pressed military pith helmets provided to the US armed services during World War II. From World War II to the Gulf War, the pressed fiber pith helmet is noted for the historic length of its combat usage in the United States, outlasting the M1 steel helmet by approximately ten years. This makes the pressed fiber pith helmet the longest used helmet in service by the United States military.[38] Throughout World War II, International Hat was one of two major government contracted manufacturers of the pressed fiber pith helmets for US military personnel. Hawley Products, Inc. was the other major government contractor. Between Hawley Products Company and International Hat Company, over 100,000 pith helmets were produced for military use in the European and Pacific theaters. In particular, the United States Marine Corps used the International Hat pith helmet as both combat gear, as well as a standard part of the Marine Corps training uniform.[39] Although the International Hat pith helmet was designed and introduced before the M1 steel helmet, the International Hat pith helmet continued to be used in the military for many decades, including the Korean War and Vietnam War. By the Gulf War, only certain personnel in the US Navy had the pressed fiber pith helmet as serviceable gear.

Military logistics records preserve the stock number, product type, military service date, and quantity produced for military use. Each service branch of the military kept separate quartermaster records until 1947. In particular, the US Army is known to have commissioned 38,423 International Hat helmets for World War II and its aftermath.[8]

Product Stock Number Type of Product Order Received Date Quantity Sold By Date
Army W-699 Fiber Military Helmet February 10, 1942 15,878[8]
Army PO Fiber Military Helmet May 1942 10,989[8]
Army W-30 Fiber Military Helmet 1946 11,875[8]

Legal issues

Manufacturing code hearing (1934) Washington, D.C. with International Hat Company representatives seated at the bottom of left table. International Hat was an early participant in the establishment of industry standards, product certification, and claimant issues arising from patent infringement cases within the US hat apparel industry.

International Hat has had several labor issues settled in the US legal system. The company also participated in ways to avoid legal issues. In 1934, Frank P. Pellegrino represented the company in Washington D.C. at the US Hat Manufacturing Code hearing, to update manufacturing and labor practices within the industry, as the industry attempted to mitigate the need for government regulation during the New Deal era. International Hat's labor issues were generally with the National Labor Relations Board and the issue of unionization. Over the decades, the employees of the company never unionized, although unsuccessful attempts at unionization were made in joining the United Hatters, Cap, and Millinery Workers International, an AFL-CIO affiliate of 20,000 hat workers.[21][40] However, unionization never proved popular with the employees or the culture of the company.[40] In 1976, the Oran factory voted to unionize with the Retail Clerks Union but the motion failed.[41] In 1985, the National Labor Relations Board ruled against International Hat Company for allegedly violating Section 8(a)(1) and (3) of the National Labor Relations Act (Act). 29 U.S.C. Sec. 158(a)(1) and (3).[40] The company was claimed to have infringed upon the right of Tex Barnes, a cutter at the International Hat factory in Piedmont, Missouri to organize a union.[40] Barnes led the efforts for certification in April of 1980 and was also a member the union's negotiating committee.[40] However, as in previous instances, the union lost the election when put to an employee vote.[40] The union was formally decertified on March 4, 1982.[40] Barnes filed an unfair labor practice charge against the company nine months later.[40] Although the National Labor Relations Board ruled in Barnes' favor, the United States Court of Appeals Eighth Circuit vacated and remanded the earlier decision.[40]

Philanthropy

International Hat engaged in various philanthropic activities. Most notably, was the establishment of two municipal parks under President and Chairman Pellegrino. Following the death of his business associate and the former president, Pellegrino donated land and money for the construction of a municipal park in Oran, the George Tilles Jr. Memorial Park.[24] In 1968, Pellegrino commissioned a new park in Marble Hill, MO.[42] Maria Pellegrino Park was dedicated in memory of Pellegrino's mother and opened to the public on June 2, 1972.[43] During the dedication ceremonies, the Mayor declared the event to be remembered as "Pellegrino Appreciation Day."[44] International Hat directly donated money to building the large pavilion at Pellegrino Park.[43]

Another philanthropic activity of the company was the donation of hats to certain American volunteer organizations. In 1981, International Hat donated 4,764 hats to the national convention of the Girls Scouts of America.[45] In 1989, the company produced 200 specially made women's spring hats for the General Federation of Women's Clubs (GWFC) convention delegates in Marble Hill.[46]

Legacy

In the subsequent decades of World War 2, International Hat military pith fiber helmets, produced at the original factory in St. Louis, have become collector's items for military helmet and World War 2 collectors of American military uniform apparel. This is particularly true of the International Hat Marine helmets, which bear the USMC insignia on the front of the helmet.

Facilities

International Hat had multiple domestic and international facilities. At the height of its expansion, International Hat operated seven domestic factories, several warehouses, several international buying offices, and a sales office in New York. Six factories were located in Missouri and the seventh operated in Texas. The majority of warehouses were located onsite. From the 1930s to 1960s, the largest International Hat factory also served as the headquarters of the company, which was located in St. Louis, Missouri. The other factories in Missouri were located in Chaffee, Dexter, Marble Hill, Piedmont, and Oran.[9][47][48] The Oran factory was constructed in 1946.[49] The factory was expanded in 1948 and 1968.[50] It eventually closed in 1984.[51] The Chaffee plant was closed in 1981 after opening in the summer of 1980 with 100 employees.[52][53][54] The Chaffee factory was operated by Florsheim Shoe Company, another subsidiary of Interco.[55] The Marble Hill factory was expanded in 1972.[56] The facility employed approximately 300 workers.[57] The Dexter facility was opened in 1959 and operated for 30 years under International Hat.[4]

Presidents and CEOs

See also

References

  1. 1 2 3 4 5 6 Fox 1995, p. 54.
  2. 1 2 National Register of Historic Places, Nomination Form. Missouri State Government. December 1975. Retrieved on 10 March 2016.
  3. 1 2 3 4 5 6 7 8 9 International Hat Company 1942, p. 3.
  4. 1 2 3 4 5 6 7 8 9 "New Ownership Gives Life Back to Factories" The Southeastern Missourian. April 19, 1989, p. 1. Retrieved on 11 March 2016.
  5. 1 2 Schmidt 1990, p. 70.
  6. ↑ "Building Boom Gains Momentum". Southeastern Missourian. May 19, 1972. Retrieved March 20, 2016.
  7. ↑ "Marble Hill to Ballot on Gift of Cash, Park". Southeastern Missourian. May 17, 1969. Retrieved March 20, 2016.
  8. 1 2 3 4 5 6 7 Lemons 2011, p. 212.
  9. 1 2 3 Robertson, Stephen (June 5, 1971). "Oran, Village of Distinctive Personality, Self-Sufficient". Southeastern Missourian. Retrieved January 13, 2014.
  10. ↑ "Plant Closing is a Blow for Bollinger County". Southeastern Missourian. March 26, 1989. Retrieved March 21, 2016.
  11. 1 2 "$10,000 Gift, Voter Approval Bring City Park". Southeastern Missourian. April 2, 1962. Retrieved January 8, 2014.
  12. 1 2 3 4 5 Associated Press. "International Hat Company Sold to Interco", St. Louis Post-Dispatch, April 1, 1978, p. 1E.
  13. ↑ "Cardinal Extends Takeover Offer for Interco". Baltimore Sun. Associated Press. September 12, 1988.
  14. ↑ Michael Quint. "Market Place; A Takeover Bid Revives Interco" New York, NY: New York Times, August 22, 1988. Retrieved on 13 March 2016.
  15. 1 2 Schmidt 1990, p. 71.
  16. 1 2 Widder, Pat (October 27, 1991). "Dealmaking Gone Awry". Chicago Tribune. Retrieved March 13, 2016.
  17. 1 2 "Dexter Group Buys Area for Industrial Use". Southeastern Missourian. July 15, 2001. Retrieved March 19, 2016.
  18. ↑ National Register of Historical Places (2016) Brown Shoe Company's Homes-Take Factory United States Federal Park Services. Retrieved March 15, 2016
  19. ↑ Geo. N. Lowrey Company 1919, p. 103.
  20. 1 2 3 4 International Hat Company 1942, p. 6.
  21. 1 2 Block, Michael (February 2, 1983). "Hat Industry Puts High Hopes on Your Head". Milwaukee Journal. Hartford Courant. Retrieved March 21, 2016.
  22. ↑ Frum, David (December 24, 2014). "The Real Story of How America Became an Economic Superpower". The Atlantic. Retrieved May 5, 2016.
  23. ↑ International Hat Company 1942, p. 4.
  24. 1 2 "Oran Gets Factory". Southeastern Missourian. November 9, 1946. Retrieved January 14, 2014.
  25. ↑ "St. Louis Advertising and PR Agencies". St. Louis Media History. St. Louis Media History Foundation. Retrieved March 21, 2016.
  26. ↑ "Spradling to Speak at Open House". Southeastern Missourian. August 22, 1973. Retrieved March 20, 2016.
  27. ↑ Jean S Goodson. "Notice of Special Meeting of Stockholders", International Hat Company Proxy Statement, St. Louis, MO, March 2, 1978, p. 1-3.
  28. ↑ St. Louis Post-Dispatch. "Last International Hat Plant To Close", March 29, 1989, p. 12B.
  29. ↑ "Interco to Close Hat Plant, Idling About 200 in Southeast Missouri". St. Louis Post-Dispatch. Associated Press. March 23, 1989.
  30. ↑ Norris, Floyd (September 19, 1979). "Record Sales of Hats". Herald-Journal. Associated Press. Retrieved March 20, 2016.
  31. ↑ Steyer, Robert; Manor, Robert (January 26, 1991). "Interco Enters Bankruptcy Company Struggling With Heavy Debt Load". St. Louis Post-Dispatch.
  32. ↑ Kalajian 1992, p. 745.
  33. ↑ Schmidt 1990, pp. 69-71.
  34. ↑ Kalajian 1992, pp. 745-841.
  35. ↑ "Marble Hill Plant to Close in June; 200 Jobs are Lost". Southeastern Missourian. March 22, 1989. Retrieved March 21, 2016.
  36. ↑ Jackson, Jeffrey (October 27, 1997). "Venture Products to Expand, Consolidate". Southeastern Missourian. Retrieved March 20, 2016.
  37. ↑ Suciu, Peter. "The American Pressed Fiber Helmets Blueprints". Military Sun Helmets. Military Helmet Experts. Retrieved March 21, 2016.
  38. ↑ Tulkoff 2003, p. 268.
  39. ↑ Tulkoff 2003, p. 107.
  40. 1 2 3 4 5 6 7 8 9 McMillian, Judge; Henley, Judge; Fagg, Judge. "INTERNATIONAL HAT COMPANY, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.". Legal Resource. United States Court of Appeals, Eighth Circuit. Retrieved March 21, 2016.
  41. ↑ "Firm to Vote on Union". Southeastern Missourian. August 16, 1976. Retrieved March 21, 2016.
  42. ↑ "Twin Cities Get Offer of Land, Cash for Park". Southeastern Missourian. April 2, 1969. Retrieved January 8, 2014.
  43. 1 2 The Missourian. "Dedicate New Bollinger Park". The Southeast Missourian, Cape Girardeau, June 5, 1972. Retrieved on 8 January 2014.
  44. ↑ The Missourian. "Dedicate New Park at Ceremonies Sunday", The Southeast Missourian, Cape Girardeau, June 2, 1972. Retrieved on 25 November 2013.
  45. ↑ "Hats for Scouts". Southeastern Missourian. September 10, 1981. Retrieved March 20, 2016.
  46. ↑ "Spring GWFC Draws 126 Delegates". Southeastern Missourian. May 9, 1989. Retrieved March 21, 2016.
  47. ↑ Owen, Ray (March 29, 1989). "Factory Job Loss Passes 900". Southeastern Missourian. Retrieved November 25, 2013.
  48. ↑ "City Honors Industry". Bulletin Journal. August 7, 1980. Retrieved March 20, 2016.
  49. ↑ "Oran to Plan Factory Drive". Southeastern Missourian. October 3, 1947. Retrieved March 20, 2016.
  50. ↑ "Business & Commerce Cape Girardeau". Southeastern Missourian. November 16, 1968. Retrieved March 20, 2016.
  51. ↑ "Factory Closings". Southeastern Missourian. March 29, 1989. Retrieved March 21, 2016.
  52. ↑ "Out of the Past: April 17, 1980". Southeastern Missourian. April 17, 2005. Retrieved March 21, 2016.
  53. ↑ "Chaffee Named as Plant Site". Southeastern Missourian. June 22, 1983. Retrieved March 20, 2016.
  54. ↑ "New Plant". Southeastern Missourian. May 9, 1980. Retrieved March 21, 2016.
  55. ↑ "Chaffee". Southeastern Missourian. June 11, 1984. Retrieved March 21, 2016.
  56. ↑ "Began Building Addition on Marble Hill Hat Company Soon". Southeastern Missourian. February 25, 1972. Retrieved March 20, 2016.
  57. ↑ "Gas leaks cause minor discomfort". Southeastern Missourian. January 7, 1980. Retrieved March 20, 2016.

Bibliography and further reading

  • Carver, Nancy Ellen (2002). Talk with Tilles: Selling Life in Fort Smith, Arkansas. Bloomington, IN: Xlibris Publishing. ISBN 1401071996. 
  • Fox, Tim (1995). Where We Live: A Guide to St. Louis Communities. St. Louis, MO: Missouri Historical Society Pr. ISBN 188398212X. 
  • Goodson, Jean S. (March 2, 1978). "Notice of Special Meeting of Stockholders: Proxy Statement". International Hat Company. 
  • International Harvest Hat Company: A Brief History, 1917-1942 (25th Anniversary ed.). St. Louis, MO: International Hat Company. 1942. 
  • Kalajian, Perry (1992). "The Controversial World of Corporate Mergers and Acquisitions: A Critical Assessment". Missouri Law 57 (3): 745–832. 
  • Lemons, Charles R. (2011). Uniforms of the US Army Ground Forces (1939-1945), Addendum. Raleigh, NC: Lulu Press. ISBN 1105268926. 
  • Schmidt, Richard John (1990). The Divestiture Option: A Guide for Financial and Corporate Planning Executives. Westport, CT: Greenwood Publishing Group. ISBN 0899303978. 
  • "The Hat Department". The Clothier and Furnisher 95 (1): 103. 1919. Retrieved March 19, 2016. 
  • Suciu, Peter; Bates, Stuart (2010). Military Sun Helmets of the World (2nd ed.). Uckfield, UK: Naval and Military Press. ISBN 9781894581523. 
  • Tulkoff, Alec (2003). Grunt Gear: USMC Combat Infantry Equipment of World War II. San Jose, CA: R. James Bender Publishing. ISBN 0912138920. 

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