Crane & Co., Inc.

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Crane & Co., Inc.

30 South St.
Dalton, Massachusetts 01226
U.S.A.
(413) 684-2600
Fax: (412) 684-0817
Web site: http://www.crane.com

Private Company
Founded: 1801
Employees: 1,400
Sales: $200 million (1997 est.)
SICs: 2678 Stationery Products; 2621 Paper Mills

Crane & Co., Inc. is a family-owned papermaker known for its high quality stationery and for making money—U.S. currency, that is. The company became the sole supplier of currency paper for the U.S. Treasury in 1879. It also produces business papers, including archival record paper and ledgers through its Weston Paper division; makes technical papers for architects, engineers, and artists; develops glass- and poly-fiber materials used in filters, insulation, and other applications; and, through its Excelsior Printing Co. division, provides engraving, design, and printing-related services.

Zenas Crane Founds a Company: 1801–45

In 1799, Zenas Crane chose the small, agricultural town of Dalton in western Massachusetts in which to build his paper mill, on the banks of the Housatonic River. Zenas was following in a family tradition.

His father, Stephen, a papermaker, had sold a special security-type paper to Paul Revere. Revere used that paper to print the first bank notes in the colonies, in December 1775, two years before Zenas was born.

Zenas learned the art and science of papermaking as a teenager, how to clean old rags, then beat them into pulp, from which the paper was made. Wanting his own mill, he looked west, and found 14 acres near wood and water and a population that could supply both the rags and employees. It took him two years to raise the money for the land and a mill. But in 1801, Zenas and his two partners, Henry Wiswell and John Willard, were in business.

Local housewives provided the new mill with the rags needed to make paper. The company’s first advertisement, reproduced in Wadsworth Pierce’s history, urged “that every woman, who has the good of her country, and the interest of her own family at heart, will patronize them, by saving her rags, and sending them to their Manufactory, or to the nearest Storekeeper—for which the Subscribers will give a generous price.” Most of the rags the housewives offered were of a tough, homemade linen that was difficult to reduce to pulp, but made a very high grade of paper. This happenstance, combined with Zenas Crane’s own perfectionism, established the firm’s tradition of uncompromising quality in its products. Early customers included publishers, storekeepers, banks (many of which printed their own money), and the government of Massachusetts.

In 1822, Zenas bought out his partners and became the sole owner. At the same time, machines were playing a more important role in the industry: a cylinder machine replaced hand molding, and then steam-heated drying cylinders were introduced. Zenas developed a machine to automatically remove the paper from the papermaking machines.

In 1842, Zenas turned management of the company over to two of his sons, Zenas Marshall Crane and James Brewer Crane. Two years later, Zenas Marshall developed a paper that significantly deterred the altering of banknotes. He was able to imbed silk threads vertically into the paper to indicate the note’s denomination: one silk thread for a $1 bill, two for a $2 bill, and so on. The new paper meant that $1 bills could no longer become $10 bills with the addition of a “0.” Banks quickly placed orders. In 1845, Zenas Crane died at the age of 68.

Second Generation of Cranes: 1845–64

One of the company’s biggest problems—transportation—was significantly reduced during the mid-1880s when the Boston and Albany Railroad came to Dalton. Now the Cranes could send their paper by rail instead of transporting it over land to the Hudson River and then downstream. The railroad also opened new markets, particularly in the West, and the Crane brothers built a second mill. Production was increased with the introduction of the Fourdrinier machine, which automated the paper-making process.

In 1851, the Cranes became the owners of a woolen mill which had gone bankrupt (Zenas had held the mortgage). They turned it over to brother Seymour, who converted it into a papermaking mill, which operated under the name Crane & Wilson and produced nothing but fine writing paper. However, Seymour’s operation went out of business before the end of the decade, as the country moved towards civil war.

Although the two Crane mills in Dalton continued to operate once the Civil War began, they lost all their Southern customers and much of the money owed to them. The Confederacy refused to pay creditors in the North. According to Pierce, however, several of the businesses paid their debt to Crane in full after the war.

New Uses for Paper

During the depression following President Lincoln’s assassination, many Northern paper mills went bankrupt. In what could be considered an early marketing coup, Crane took a chance on a fashion fad and developed a new paper for men’s collars. Men changed their collar every day, so the demand was great, and one of the company’s two mills was kept busy making them. The new paper for the collars had to be stiff, fairly thick, and able to withstand damage from dirt and perspiration.

Although the rage for paper collars did not last long, its legacy within the Crane family was important. James Brewer Crane was granted patents in 1867 and 1868 for paper belts to drive machinery. He invented the belts in the process of developing the paper for the collars. The durability of these belts gradually won over the skeptics, as did the characteristic that they would not stretch or slip as did leather or rubber belts. James Brewer’s sons continued to make the belts into the 1880s at their mill in West-field, which they operated as Crane Brothers.

Crane Brothers also manufactured baskets and cans, wash-tubs, toboggans, even coffins, out of a plastic-like paper product called Linenoid. But they did not stop there. They used their paper to make light, graceful boats. The company’s web site once included a description of a boat the brothers had at their mill in 1876: “It was about 15 feet long and three feet wide, yet so light that a couple of men could carry it with ease. The frame of the boat was made of wood and then covered with paper, about one-eighth to one-quarter-inch thick.”

One of their customers used Crane Brothers paper to make domes, including one containing 1,000 pounds of paper for the observatory at Rensselaer Polytechnic Institute. The dome built in 1881 for the U.S. Military Academy, with 36 sections and using about 2,500 pounds of paper, survived until 1959 when the building was torn down.

Quality Stationery and Shell Wrappings: 1865–75

In 1865, Zenas Crane, Jr., son of Zenas Marshall and grandson of the company founder, was put in charge of the old Crane & Wilson facility, which was renamed the Bay State Mill. There, he restarted the manufacturing of writing papers. Three years later, he had paid off the $54,000 mortgage on the building.

When the mill was destroyed by fire, a common occurrence in the industry and for the Crane family, Zenas, Jr., went to Europe to study how papermakers there produced the tinted and colored stationery that was becoming tremendously popular in the United States. The social papers he made when he returned was so fine, the mill could not keep up with orders from customers including Tiffany in New York; Baily, Banks & Biddle in Philadelphia; Shreve, Crump & Low in Boston; and Marshall Field in Chicago. In 1886, Crane stationery was used for the invitations to the dedication of the Statue of Liberty.

Zenas’s brother W. Murray Crane and cousin Frederick G. Crane joined him to form a partnership, Z. & W. M. Crane, to run the rebuilt Bay State mill. Murray was responsible for several Crane successes. In 1873, he helped develop a paper for the Winchester Arms Co. to be used as wrapping for the repeater shells of that company’s new rifle. The specifications, according to Pierce, called for “a highly-combustible, strong-but-thin” paper that left “little or no ash.”

Making Currency Papers: 1876–1900

Murray’s biggest contribution to the company occurred in 1879, when he won for Crane the contract to make currency paper for the U.S. Treasury. With a bid of 38.9 cents a pound of paper, he beat out J. M. Wilcox & Co. of Philadelphia, which had been supplying the paper, as well as other big paper companies. Murray developed a new paper, based on his father’s parallel silk thread security paper, to meet Treasury specifications, and the company bought another mill, renamed Government Mill, which made nothing but the currency paper. By the end of the century, Crane had tripled the life expectancy of one dollar bills and more than tripled the tonnage shipped to Washington, D.C.

Company Perspectives:

Quality has been a consistent and principal objective throughout the history of this manufacturer of fine papers. Relations with employees, customers and suppliers have stressed this element above all others. This visible legacy is worthy of continuing pursuit by future generations.

However, the United States was not the only country the Crane’s Dalton company made currency paper for. The American Bank Note Company was one of its biggest customers, supplying bank notes for 48 countries, as well as stock certificates, bonds, and checks. Pierce noted that “The Story of American Bank Note Company” (quoted from in The First 175 Years of Crane Papermaking) described how one of that company’s early partnerships introduced a new term to the industry. The partnership used Crane paper to print bonds, and sent the company an order for “more of that bond paper,” to use for its letterhead.

Crane’s researchers and developers were busy during the last half of the 19th century, introducing a thick paper to replace the parchment or sheepskin used for diplomas and certificates and a special thin paper for Bibles. But even as Crane was finding new uses and customers for its fine rag paper, the paper industry discovered how to make paper with wood pulp, a much less expensive process than that needed for cotton and linen fiber. Although many papermakers switched, the Crane operations did not, continuing to develop and manufacture fine rag papers. However, the company now bought its cotton and linen directly from European and U.S. mills; housewives no longer supplied the rags.

The Third 50 Years: 1901–51

The company celebrated its 100th anniversary in 1901, with four paper mills and nearly 1,000 employees. Murray Crane was governor of Massachusetts and would go on to serve as senator from 1904 to 1913.

The company was shipping its paper all over the country, and in 1903, Crane sent a salesman over the Rockies for the first time. He soon found a new customer with a new challenge: drafting paper that was strong and transparent. The tracing paper the company developed became one of its largest, although lesser-known, product lines and the foundation for its specialty papers.

By 1922, there were five Crane mills, and the several partnerships that operated them incorporated as Crane & Co., Inc. Frederick G. Crane, the son of James Brewster and grandson of the founder, was named the new company’s first president. When he died a year later, Murray’s son, Winthrop Murray Crane, Jr., took over the position, holding it for 28 years, through the Great Depression, World War II, and the postwar period.

Crane & Co. did well during these years, and shared its success within the community of Dalton, establishing a scholarship fund for local high school graduates. One of the early changes under Winthrop had to do with the currency paper. In 1928, to foil counterfeiters, the company began scattering the red and blue silk threads throughout the bills rather than imbedding two lines of thread in each bill.

To keep going during the Depression, the company developed and produced cigarette paper, and in the process came up with a better carbon paper, which remained a major product line until computers reduced the need for carbon copies. In 1932, the company established its stationery division and opened a retail operation in Dalton. Employees of the new division cut the stock produced at the Bay State mill, cut and produced the envelopes and boxes, and hand-painted the colored borders on note cards and writing paper. A row of inspectors checked each piece of paper, discarding any sheet with the slightest flaw. Two years later, Crane & Co. bought Z. & W. M. Crane, which controlled the Bay State and Old Berkshire Mills, adding the Stationery Division to its operations.

During the war, Crane operated 24 hours a day, producing paper for currency, War Bonds, and finally, invasion money. The shortage of linen resulted in a new formula, reducing the amount of linen from 75 percent to 50 percent, and increasing the cotton content from 25 percent to 50 percent. The war also cut off Crane’s access to European linen mills. To fill the need, the company used a linen byproduct from linseed oil mills in Minnesota.

Expansion and Modernization: 1951–89

In 1951, Bruce Crane assumed the presidency of Crane & Co. when Winthrop became chairman of the board, a new position. In the mid-1950s, the company began a major project to clean up the Housatonic River. Over the next 20 years, the company spent more than $1.5 million installing improvements including a pollution control system that sent most of the discharges from the mills to a central processing plant. “They were leaders in environmental pollution controls, very active very early on and very cooperative with the environmental program at the college,” the chair of the local community college’s Life Sciences Department told the Los Angeles Times in 1986.

Those expenditures were only a small portion of the some $35 million the company spent modernizing and expanding during Bruce Crane’s presidency. In 1956, Crane bought Dalton’s other paper manufacturer, the Byron Weston Company, the original supplier of paper for Social Security cards. In addition to ledgers, which it had been producing since 1863, Byron Weston products included diploma parchment, bond, and index papers, as well as archival record paper used by local governments. That same year, the formula for the currency stock changed again, increasing cotton to 75 percent in response to a new printing process that printed the money on dry paper.

In 1968, the company invested heavily in its research efforts to develop new products, building the $300,000 Crane-Weston Development Center. The following year, Crane & Co. expanded into printing and engraving with the purchase of the Excelsior Printing Company and Excelsior Process and Engraving, Inc., in Massachusetts, and, in 1970, of Standard Process & Engraving, Inc., in California.

The company introduced Craneglas in 1970, after ten years of research. This new paper product used glass and other manmade fibers instead of cotton, and could be used for insulation, filters, and food packaging. The company continued to develop what they called “nonwoven” products, and within 20 years Crane nonwoven papers were being used in applications ranging from pipewrap to airplane firewalls to circuit boards to cafeteria trays to vertical window blinds.

Benjamin J. Sullivan was elected president in 1975, the first person to hold that office who was not a member of the Crane family. However, his grandfather had worked for the company for some 50 years, as a paper machine tender at the Bay State Mill. That same year also saw the opening of the new $8.5 million Wahconah Mill to manufacture paper for U.S. currency. Wahconah was the first complete Crane paper mill built in the 20th century.

Ten years later, in 1985, Sullivan was named chairman and CEO, and Thomas White became president. The company’s sales topped $100 million for the first time, with sales to the Treasury accounting for a quarter of that amount.

During the 1980s, Crane expanded its sales of currency paper directly to other governments so that by 1990 it had about a dozen foreign customers. Over the years, those clients included Mexico, Bolivia, and Taiwan. “They’re typically the underdeveloped countries, because as one could logically assume, the more developed a country becomes, the more likely it would be to have its own manufacturing facilities as well as printing facilities,” a Crane official stated in a 1990 article in Boston Business Journal.

Continuing to Innovate: 1990–95

The early part of the decade saw several innovations. Crane received a new patent for a method to deter counterfeiting by imbedding clear polyester threads in the paper which failed to show up when the paper was photocopied. The company also returned to its tradition of using clothing rags to make paper. It introduced Crest R, a paper composed of 30 percent recycled cotton such as old table cloths and 70 percent recovered cotton fiber. Then, in 1993, it developed a 100 percent denim paper made for Levi Strauss Inc. from recycled scraps of Levi blue jeans. The Levi company used the paper for letterhead, corporate checks, and envelopes. In addition to producing a distinctive and sturdy paper, the recycling process kept a large portion of Levi Strauss’s over two million pounds of denim scraps out of landfills.

Continuing its creative reuse of materials, the following year Crane introduced its “Old Money” line of stationery, made from recycled U.S. dollar bills. Instead of trying to get the dark ink out of the bills, which would have caused a solid waste problem itself, Crane left the ink in, giving the paper the color of money. Each ream of Old Money contained nearly $15,000 worth of shredded bills.

1996 to the Present

In 1996, Congress increased its efforts to have the Treasury Department seek more competition for its currency contract. The first move was a reinterpretation of a 1988 law to mean that a bidder had to be 50 percent U.S.-owned, thus opening the door to foreign companies. The Department also posted a draft solicitation for the currency contract on the Internet, offering subsidies for start-up costs and equipment.

Crane and its Congressional representatives fought the effort over the next several years, and the subsidies were never approved. In 1998, the Government Accounting Office released a report concluding that Crane should face competition because the Treasury could not determine whether its prices were fair or not. “This has been a continuing and ongoing assault by international joint ventures to try and break through on this,” Senator Edward M. Kennedy (D-Mass.) told the Associated Press in October 1998. In January, the government took bids from several companies in addition to Crane for the $400 million contract to supply currency paper through 2002, but by October it appeared that Crane would win that contract.

Crane & Co., with seventh-generation members of the family actively involved in the management of the company, had a history of responding innovadvely to problems. As the century was coming to a close, the expanded competition for the lucrative currency contract, supported by government subsidies to help companies with start-up and equipment costs, certainly posed a threat to Crane, as did the possibility of a $1 coin. In the meantime, Crane’s research and development activities explored possible markets for nonwoven materials and alternative fiber papers using flax and hemp in its ongoing efforts to create tree-free papers.