Milton S. Hershey: The Life Behind the Chocolate Business

In 1900, Milton S. Hershey sold the business that had finally made him successful. Lancaster Caramel Company had grown from a difficult restart into an international candy enterprise. He sold it for $1 million but kept his younger chocolate company.

That same year, Hershey’s milk chocolate bars reached customers. The bars came before the large factory and the Pennsylvania community that would eventually carry his name. After two failed confectionery ventures and one successful caramel business, Hershey was committing his future to chocolate.

Chocolate became the foundation for much more than a product line. Hershey went on to develop a manufacturing town, establish a residential school with his wife, Catherine, and transfer much of his fortune to support that school. His story also included serious financial trouble and a violent labor dispute, even as the school he supported developed a lasting financial foundation.

A Quick Look at the Life of Milton S. Hershey

From a Changing Childhood to the Confectioner’s Trade

Hershey was born on a family farm in Derry Township in 1857. His parents, Henry and Fanny Hershey, moved repeatedly while Henry pursued business ventures that did not succeed. Milton attended at least seven schools, but his formal education ended at roughly the fourth-grade level.

In 1871, Hershey briefly apprenticed with printer Samuel Ernst in Gap, Pennsylvania. After he was dismissed, his mother arranged a different opportunity with Joseph R. Royer, a confectioner and ice-cream maker in Lancaster.

Beginning in 1872, Hershey spent about four years learning candy-making in Royer’s shop. The apprenticeship gave him a trade, but learning to make candy and building a successful candy business were very different challenges.

Two Failed Candy Businesses—and a Return to Lancaster

In 1876, at eighteen, Hershey opened a confectionery business in Philadelphia. His mother and Aunt Martha, known as Mattie, helped him. The shop remained under financial pressure, and after roughly six years it failed in 1882.

Hershey next worked for a Denver confectioner who taught him to make caramels with fresh milk. That method mattered to his later career, but it did not lead straight to success. After considering opportunities in Chicago and New Orleans, he opened another candy business in New York City in 1883. By 1886, it too had failed amid financial difficulties.

Returning to Lancaster, he again worked with Fanny and Mattie. This time, fresh-milk caramels offered the product around which he could build a lasting enterprise. He sold a line called Crystal A caramels, while William Henry Lebkicher, who had worked with Hershey before, became an important associate. The operation became Lancaster Caramel Company.

The growing business faced a consequential test when a British importer placed a large order. Filling it required financing for ingredients. The Hershey Community Archives recounts that a cashier at Lancaster National Bank personally supported the needed loan. The company went on to reach international customers, and by 1894 Hershey had become a prominent businessman in Lancaster.

The World’s Fair Machinery That Opened a New Direction

At the 1893 World’s Columbian Exposition in Chicago, Hershey saw German chocolate-making machinery in operation. He purchased equipment and installed it in Lancaster. In February 1894, he formed the Hershey Chocolate Company as a subsidiary of his successful caramel business.

Its early products were not limited to the milk chocolate bar now associated with the Hershey name. The company offered cocoa, baking chocolate, coatings and a variety of sweet-chocolate novelties. Hershey and selected employees then experimented with methods of combining milk, sugar and cocoa, including work that involved condensing fresh milk at the family Homestead.

Milk chocolate already existed in Europe. Hershey’s achievement was not inventing it, but helping develop processes for making an affordable version with fresh milk on an industrial scale. Machinery and the work of company employees were central to that effort.

His colleague Frank Snavely later recalled Hershey saying, “Caramels are a fad; Chocolate is permanent.” In 1900, Hershey sold Lancaster Caramel Company to American Caramel Company, retained his chocolate operation and introduced milk chocolate bars.

The early bars sold in sizes priced from approximately two to ten cents, with a five-cent bar later becoming a standard. Expanding production of this mass-market chocolate would call for a new factory.

Moving Chocolate Production—and Building a Community

Hershey had purchased the farm where he was born, known as the Homestead, in 1897. As his chocolate operation developed, he chose Derry Township for a purpose-built factory. Local milk supplies, water, rail connections and available labor offered practical advantages, even though some associates regarded the site as remote.

Land purchases began in late 1902. Ground was broken for the factory on March 2, 1903, and the plant began operating in 1905. Hershey and his workforce developed or adapted specialized equipment to produce consistent milk chocolate in large quantities. The bars had been sold for five years before this factory opened. The new plant allowed the business to expand production.

Alongside the factory, Hershey planned a community with housing, transportation, schools, a bank, parks and other amenities. Engineer Henry N. “Harry” Herr helped with its design. Trolley connections served surrounding places as well as the new town, rather than requiring every worker to live beside the factory.

Hershey Trust Company began banking operations in 1905 and later served as trustee of the school trust. Recreation grounds that became Hershey Park opened in 1906, the year the community took the name Hershey. The chocolate company began producing Hershey’s Kisses in 1907. In 1908, Milton and Catherine moved into their house, High Point, overlooking the factory.

The amenities came with paternalistic management: business interests and town services were closely intertwined. Some employees were skeptical of Hershey’s proposals, including a planned cooperative store that workers rejected.

Catherine Hershey and the School They Founded Together

Milton Hershey met Catherine Elizabeth Sweeney in 1897 at A. D. Work’s confectionery in Jamestown, New York, while traveling on caramel business. They married on May 25, 1898, in the rectory of St. Patrick’s Cathedral in New York City. Catherine was a participant in the educational philanthropy that became a defining part of their shared life.

They had no children. On November 15, 1909, both signed the deed establishing Hershey Industrial School, a residential institution for orphaned boys. Its original admission rules were narrow: children had to be healthy boys aged four to eight whose fathers had died. The school’s program combined care, education, physical activity and practical skills.

The first four students, two pairs of brothers, arrived at the Homestead on September 3, 1910. Superintendent George Copenhaver and his wife Prudence oversaw their early residential life. Hershey later credited Catherine with originating the school idea, reportedly saying, “It was Kitty’s idea.” The founding deed bears both their signatures.

Catherine died on March 25, 1915, after a long illness. The school continued, and Milton took a further step to support it. On November 13, 1918, he transferred 5,000 shares of Hershey Chocolate Company stock—his chocolate-company holdings and the bulk of his fortune—into a trust for the school’s benefit.

The transaction became widely known only in 1923, when newspapers described an extraordinary gift worth $60 million. That figure reflected a contemporary valuation of the stock; it was not a transfer of $60 million in cash. The stock gift gave the school a substantial and continuing financial foundation.

The school’s historical record also preserves Hershey’s explanation of his commitment to educational opportunity: “I was successful in business because I had opportunities.”

Cuban Sugar, a Financial Shock and Reorganization

Chocolate manufacturing relied on sugar, and Hershey expanded into sugar production in Cuba during the First World War period. After visiting the island in January 1916, he acquired and developed plantations and mills. A mill at Central Hershey was completed in 1918, and an electric railway linking Havana and Matanzas was completed in 1922. The Cuban operations also included a planned community and school.

Expansion exposed the business to new risks. A collapse in the sugar market in 1920 brought heavy losses from sugar-futures investments to Hershey Chocolate Company. The enterprise was mortgaged and came under the oversight of lender National City Bank. The financial crisis affected the company; it was not a documented personal bankruptcy for Hershey.

By June 1922 the company had cleared its obligation to the bank. A further restructuring followed in 1927. Hershey Chocolate Corporation held the chocolate business; Hershey Corporation held Cuban sugar interests; and Hershey Estates managed many community and non-chocolate properties. Hershey Trust Company, as school trustee, linked the businesses through ownership.

Construction Work in the Great Depression

When the Depression threatened jobs and local economic activity, Hershey commissioned a broad program of construction. The Great Building Campaign provided work while adding facilities to the community and its institutions. Projects included The Hotel Hershey, the community building and theatre, sports facilities, school expansion and a company office building.

The Hotel Hershey opened on May 26, 1933. Across the wider campaign, more than 600 workers found employment, according to the community archives. The program blended an employment objective with the development of facilities for the town and its businesses.

In 1933, Hershey also widened the school’s admission rules. Boys aged four to fourteen could qualify if either parent had died, rather than only boys aged four to eight whose fathers had died.

The 1937 Strike and the Limits of the Model Town

During the 1930s, changes in working hours and reduced individual pay contributed to labor tensions at Hershey Chocolate Corporation. In April 1937, approximately 500 employees occupied the chocolate plant in a sit-down strike.

On April 7, non-striking workers and local farmers forcibly removed the strikers. People were beaten. The dispute divided the community, and a later employee vote rejected the union in that election.

The violence was carried out by those groups; the documented account does not establish that Milton Hershey personally ordered the assault. At the same time, the events make it impossible to describe the town as a place of uninterrupted labor harmony. Worker amenities and worker grievances existed side by side.

That September, employees organized a public celebration of Hershey’s eightieth birthday, attended by more than 8,000 people. The community archives describe the celebration as an attempt to heal divisions left by the strike.

Later Projects, Wartime Production and His Final Years

Hershey’s community investments extended beyond the factory and building campaign. He established the M. S. Hershey Foundation in 1935 for local educational and cultural purposes. The Hershey Rose Garden, which developed into Hershey Gardens, opened in 1937.

In 1937, the U.S. Army contacted Hershey Chocolate Corporation president William Murrie and chief chemist Samuel Hinkle about an emergency chocolate ration. Hinkle and other employees developed the Ration D bar. Milton encouraged the work, but it was a company and workforce achievement, not a formula he personally devised. The company received the Army–Navy “E” award in 1942 for its wartime production.

By 1941, chocolate-company sales had reached $55 million, compared with $622,000 in 1901. Those figures measure company revenue rather than Hershey’s personal fortune, but they convey how far the manufacturing enterprise had expanded during his lifetime.

Milton Hershey died at Hershey Hospital on October 13, 1945, aged 88. He was buried in Hershey Cemetery near Catherine and his parents. Although he had given the bulk of his chocolate holdings to the school’s trust in 1918, his estate at death was still valued at nearly $900,000. A separate trust under his will benefited Derry Township public schools.

The Legacy of a Business, a Town and a School

Hershey’s lasting influence cannot be confined to the chocolate bar. The town’s institutions, the business structures that supported them and the residential school established with Catherine continued beyond his death. Later trustees and school leaders—not Milton himself—made further changes, including admitting students of color in 1968 and girls in 1977. The modern Milton Hershey School serves boys and girls from low-income families.

His record brings together developments that do not fit a simple celebration: repeated early failures, an ambitious manufacturing pivot, a large educational gift, a dangerous sugar-market setback, significant community spending and a violent labor dispute. Hershey helped make affordable milk chocolate a large-scale American business, while his legacy also raises questions about the promises and limitations of a town so closely tied to one enterprise.

Timeline

These milestones trace Hershey’s principal changes in work, business and philanthropy, along with major developments in the community he created.

1857

Milton Snavely Hershey is born September 13 in Derry Township, Pennsylvania.

1871–1872

After a brief, unsuccessful printer apprenticeship, he begins learning confectionery work from Joseph R. Royer in Lancaster.

1876–1886

His Philadelphia and New York confectionery ventures fail; between them he learns fresh-milk caramel making in Denver. He returns to Lancaster in 1886.

1893–1894

He purchases chocolate machinery after seeing it at Chicago’s World’s Columbian Exposition and establishes Hershey Chocolate Company as a Lancaster Caramel subsidiary.

1898

He marries Catherine “Kitty” Sweeney on May 25 in New York City.

1900

Hershey sells Lancaster Caramel Company for $1 million, retains his chocolate business and introduces Hershey’s milk chocolate bar.

1903–1905

Construction begins on the new Derry Township factory, which opens in 1905. Hershey Trust Company also begins banking in 1905.

1906–1908

The community takes the name Hershey, recreational grounds open, Hershey’s Kisses begin production, and Milton and Catherine move into High Point.

1909–1910

Milton and Catherine sign the school deed on November 15, 1909. The first four boys arrive September 3, 1910.

1915–1918

Catherine dies in 1915. Milton begins investing in Cuban sugar interests in 1916 and transfers 5,000 shares of chocolate-company stock to the school trust in 1918.

1920–1922

Heavy losses in sugar futures lead to lender oversight in 1920. The company clears its bank obligations in 1922.

1923

Newspapers publicize Hershey’s 1918 stock gift to the school, referring to an estimated $60 million value.

1927

Hershey reorganizes the interconnected chocolate, Cuban sugar and town-related businesses.

1929–1939

The Great Building Campaign provides construction work and new community facilities, including The Hotel Hershey, which opens in 1933.

1937

A sit-down strike at the chocolate plant ends in a violent ejection of strikers. Hershey’s Rose Garden opens, and a large community gathering marks his eightieth birthday.

1942

Hershey Chocolate Corporation receives an Army–Navy “E” award for wartime production.

1945

Milton Hershey dies October 13. His estate provides for an additional trust benefiting Derry Township public schools.

FAQs

Was Milton Hershey already successful before he made chocolate?

Yes. Hershey built Lancaster Caramel Company into a successful business with international customers. He sold it for $1 million in 1900 while retaining his chocolate company, which he had started as a subsidiary in 1894.

Did Milton Hershey invent milk chocolate?

No. Milk chocolate existed in Europe before Hershey’s work. His important contribution was developing methods for mass-producing an affordable fresh-milk version in the United States. Hershey’s milk chocolate bar appeared in 1900.

Did Milton and Catherine Hershey have children?

No. The couple had no children. In 1909 they jointly founded Hershey Industrial School, initially a residential school for orphaned boys, and Milton endowed its trust with a large gift of stock in 1918.

Did Milton Hershey donate $60 million in cash to the school?

No. In November 1918, Hershey placed 5,000 shares of Hershey Chocolate Company stock into a trust for the school’s benefit. Newspapers reported an estimated value of $60 million when the gift became public in 1923; it was a stock transfer rather than a cash donation.

Was Milton Hershey booked to sail on the Titanic?

Hershey had made a $300 deposit with the White Star Line, documented by a 1911 check. He did not sail on the Titanic. He returned to New York earlier in April 1912 aboard the Amerika.

Was the town of Hershey free of labor conflict?

No. Although Hershey invested in housing, transportation, recreation and public amenities, a 1937 sit-down strike at the chocolate factory ended when non-striking workers and local farmers forcibly expelled strikers, with documented beatings. The people who carried out the ejection are documented; a personal order from Milton Hershey is not established.

Further Reading

• Hershey Community Archives: digitized Hershey Press issues (1909–1926) — contemporary community newspapers for readers interested in the town’s early decades.

Sources

• Hershey Community Archives: Milton Snavely Hershey biography, Catherine Sweeney Hershey, The early chocolate company, Origins of Hershey’s milk chocolate.
• Hershey Community Archives: Hershey Trust Company, History of Hershey Estates and associated businesses, History of Milton Hershey School, Central Hershey, Cuba.
• Hershey Community Archives: The Great Building Campaign, Eckenroth journals and the 1937 strike, Milton Hershey’s birthday celebration.
• Hershey Community Archives: Hershey and the Titanic, Ration D bars, Hershey Gardens, The Derry Township public-schools trust.
• The Hershey Legacy: Milton’s early life, Chocolate entrepreneur.
• The Hershey Story Museum: Milton Hershey history.
• The Hershey Company: Company history.
• Smithsonian Libraries: Sweet Success of Hershey.
• Harvard Business School: Great American Business Leaders: Milton S. Hershey.
• Milton Hershey School: Founder’s Day: the stock gift, Hershey’s history in The New York Times, School history.
• Hershey, PA: The Hotel Hershey history.
• M. S. Hershey Foundation: About the foundation.