The company, F. Ad. Richter & Cie ., makes a very interesting study in
itself. Richter was born in 1846 in Herford, Nordrhein-Westfalen, the
son of a master baker. He quit high school to go to work for a druggist.
While still in his teens, he put the following advertisement in the
paper: "An infallible way to become rich will be given to everyone who send
a dollar. Richter". Within a short time he had several hundred dollars.
He responded with a post card with the message: "Do the same.
Richter". (This ad is documented, not some urban legend.)
In 1868 he was employed as a sales clerk in Duisburg; by early 1869 he had opened his own store. Richter believed in advertising, so his rise is easy to follow. Within a month he was selling 'medicines', using his druggist experience. In 1869 he applied for the right to sell textbooks and was granted the whole book marketing concession. Imagine the surprise of the 'authorities' when he opened his own printing establishment and hired street vendors to sell the textbooks. He also used his printing establishment to print up labels for his products and advertising and publicity brochures and even books of flattering endorsements.
Needless to say, his competitors did not like either his success or ambition. They advertised against his medical preparations and even managed to get the new German Empire to pass a law in 1872 limiting the sale of medicines to pharmacies. Although this law was poorly enforced, someone as successful as Richter was not overlooked and was soon forced out of business. Richter sold out and left Duisburg in 1873. He tried a few other places, like Nijmegen (Netherlands), Leipzig and Nuremberg. Soon he stopped selling out when he was forced out of a city. His Lebkuchen factory in Nuremberg became the quality manufacturer of cookies and cakes in Germany; his printing establishment in Leipzig quickly became a leading textbook and teaching aid supplier. Richter believed in selling quality goods. In 1875 Richter purchased a Doctor of Chemistry degree (back dated to January 30, 1873) from the nonexistent University of Philadelphia
But Richter needed a "home" for his most profitable business, patent medicines. To escape the pressures of well connected pharmacists and doctors, he obtained permission from the local Prince of Schwarzburg-Rudolstadt to build a factory. Not to be outflanked, Nuremberg druggists arranged for Richter to receive an official notice just before opening his plant in Rudolstadt that, although the manufacture of drugs was legal, such products could not be sold to the public (except through pharmacies). Richter evaded the law for several years by selling his products to a non-existent pharmacy in Roda, Saxony. In fact, his medicines were sold mail order, which had become a preferred way of buying medicines during the Franco-Prussian War (1870). By the time the Nuremberg pharmacists managed to prove that the Roda was a fraud Richter was the largest employer in Rudolstadt, employing over 200 workers in a city of 8,747. No one in Schwarzburg-Rudolstadt saw any reason to challenge Richter's business practices. Richter had found (created) a "home". In fact, he built his house (torn down and rebuilt even bigger in 1886-8) right next to the factory. During the communist era it was claimed that he built his house next to the factory so he could lord his wealth over his workers. But the reality was that the factory supplied hot and cold running water, steam heat, electricity and sewage -- none of which were available in the city of Rudolstadt at that time. Even today, the Heidecksburg, the castle of the prince, does not have electricity.
The technique of manufacture of Anchor building stones was acquired from the Lilienthal brothers in 1880. The music box and gramophone business was started, based on the acquisition of the Libellion rights by the teaching material branch in 1894 or 95. (Today Richter's music boxes and gramophones and Anker records are much sought after collector's items.) This division, as were many others, was sold shortly after Richter died in December,1910, and is today one of the founding elements of Deutsche Grammophon. Richter moved both the block business and the music business to Rudolstadt, which moves were more an indication of his own personal interest than of any business decision. Clearly Richter was very comfortable running a giant multi-division, multi-city, multi-country enterprise. In addition to the products mentioned, Richter was famous for the best chocolate (also cocoa and hard candy) in Germany and made soap, laundry and bath products, and sold a line of "health foods". In addition to the factory, he built and operated a health spa, Rudolsbad, from 1884 until taken over as a hospital during W.W.I, on the factory grounds. The hotel adjoined a park, Rudolspark, over 150 acres (60 hectares). The factory had its own railroad station and private rail siding. To understand a health spa in the middle of a factory complex, one must remember that a major part of the attraction was the high level of services. Steam heat, all electric lighting, hot and cold running water, each room with a full private bath and telephone -- all combined to make Rudolsbad a 20th century hotel in the 19th century. Richter bragged that he paid the highest wages in all of Schwarzburg-Rudolstadt. His workers also received such benefits as a subsidised canteen, free health care, coffee breaks and paid vacations. The Rudolstadt factory employed 649 people in 1910 (Rudolstadt had grown to 12,937) when he died, but only 458 in 1913. In addition all non-Rudolstadt assets (except Vienna) were liquidated or confiscated (USA and USSR) over the next ten years.
The Richter company owned branch offices in the following cities: Berlin (dates unknown -- a recording studio for his Anker records), Bilthoven, NL (after W.W.I), Brussels (1893 - 1905), Konstein, Bavaria (glass factory -- the oldest bottle factory in Germany [1570] -- bought in 1884 and sold ca. 1912), Leipzig (also teaching materials and printing establishment; 1877 - 1912), London (became Lott's; 1886 - 1898), New York (stone and medicine factories established in 1916; 1887 - 1919; confiscated by the US government and sold to A.C. Gilbert), Nuremberg (Lebkuchen and cookie factory, 1884 - 1913; now part of Schöller Ice Cream); Olten, Switzerland (1887 - 1916, when it was bought by one of Richter's sons, Walter. In that capacity it continued well into the 1950s.), Paris (dates unknown, but only a short time), Prague (1892 - 1912), Reims (1893), Rotterdam (1887 - 1915, with some sort of continuing relationship until 1964), St. Petersburg & Sablino (a major financial investment of unknown type, 1900 - 1914), Vienna (building stone [and medicine?] factory, 1886 - 1931).
Clearly Richter was a modern businessman, in every sense of the word. When he died in 1910 he was one of the ten richest men in Germany. But within ten years his heirs were broke.
As I am always telling people -- more than you ever wanted to know about Richter.
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