Shell Oil
Great business empires sometimes come from the unlikeliest beginnings. Arguably the world’s poshest department store, Harrod’s, started life as a corner grocer’s in Stepney, while Tesco was started off the back of a barrow in the East End. Similarly, Alan Sugar took his first steps to becoming a millionaire by selling vegetables out of the back of a van on East End markets.
What many of those entrepreneurs have in common, apart from East End roots, is a Jewish background - a long tradition as traders and merchants arguably combining with the outsider’s need to carve out an economic niche for himself. Few people grew their business so dramatically as the Samuels, who in the course of a generation went from selling ’seaside nick nacks’ to running one of the world’s largest oil companies.
In 1833, Marcus Samuel began his business as a trader at the docks at Limehouse and Wapping. The Sephardic Jew, descended from immigrants who had come to London from Holland and Bavaria in the 1750s, wasn’t trading in the huge cargoes of tea, sugar and linens that were coming from the four corners of the world, instead he would buy curios, such as unusual seashells, from returning seamen. Here he had something unusual, and something that Londoners would buy.
In the census of 1851, the year that the Great Exhibition in Hyde Park celebrated British industry and enterprise, Samuel listed himself as a ’shell merchant’. Was there money in shells? There was if you had a bit of imagination. This was the heyday of the English seaside, as Victorians flooded down to Brighton, Margate and Southend in their hundreds of thousands, to take the healthy sea air. Marcus had his workers glueing shells to cheap wooden boxes and selling them to young ladies as keepsakes from their trip to the coast - you’ll still see them today.
Soon his demand outstripped the supply from homecoming sailors, and a plethora of new products had joined the shells, with Marcus ordering straight from the source. Now the “Shell” Transport and Trading Company (the quotes being part of the official name) was importing “everything from ostrich feathers and partridge canes to bags of pepper and slabs of tin”. His sons (rather confusingly called Marcus Samuel and Samuel Samuel) had joined the business and were travelling the globe, building trusted relationships with the great British trading companies that were now scattered around the globe. The firms, largely run by expat Scots, lay at the nodes of the great trade routes, in Hong Kong, Manila, Bangkok, Singapore and Japan. Trade became two-way, with the company exporting finished British goods to the colonies, including the first mechanical looms sent to Japan.
The spark that turned a successful trading company into a global giant came in 1890, when the younger Marcus was on the shores of the Caspian Sea, collecting seashell specimens for the London business. This was the home of the burgeoning Russian oil industry, and Marcus (saw potential for exporting paraffin, oil for lamps, to families established markets in the Far East.
It soon got much bigger than that of course: light and power were becoming ever more important in the world economy but so now was the internal combustion engine.
The Suez Canal had been open for 40 years or so, and now assumed vital importance as a conduit for oil to the Far East. The big problem was that the authorities were nervous of huge vessels awash with flammable material navigating the watercourse and were barring them. Samuel saw the future and commissioned a fleet of eight dedicated oil tankers to ship the black stuff to the new markets. The Canal authorities were convinced by the safety of the new vessels, and his ships would be the first to be allowed through.
The first was completed in 1892, and the owner named it Murex, after a shellfish. From his collection he chose a Murex shell, to be displayed on board, and presented it to the captain. Shell had stolen a march on its rivals and grew quickly; the 1908 merger with Royal Dutch Petroleum was followed by a buyout of Mexican Eagle in 1919, with the company operating as Shell-Mex in the UK.
Samuel had been Lord Mayor of London from 1902 to 1903. In 1921 he was created First Baron Bearsted in 1921, and in 1925, became First Viscount Bearsted. His son, Walter Horace Samuel, would succeed him both as Viscount and as Chairman of Shell.
The tentacles of the company went further. Brother Samuel, meanwhile, had created Samuel Samuel & Co in Yokohama. The opening of this trading company helped paved the way for the industrialisation of Japan, while the Samuels’ other firm, M Samuel and Co, would eventually become part of merchant bank Hill Samuel (now part of Lloyds TSB).
With global warming and swiftly depleting reserves we’re probably reaching the end of the age of oil, with Shell having gone from humble beginnings to be one of the world’s biggest companies. But one sentimental tradition remains. Every new tanker that Shell launches sees the presentation of a seashell to the captain - a nod back to the East End roots of the company.