Church & Dwight Co., Inc. - Company Profile, Information, Business Description, History, Background Information on Church & Dwight Co., Inc.

469 North Harrison Street
Princeton, New Jersey 08543-5297

History of Church & Dwight Co., Inc.

Church & Dwight Co., Inc. is the world's leading producer of sodium bicarbonate (baking soda), a chemical that performs a broad range of functions, including cleaning, deodorizing, leavening, and buffering. It manufactures and sells products based on sodium bicarbonate, mainly under the Arm & Hammer trademark. These products, aside from baking soda itself, include toothpaste, deodorant, and laundry detergent. Church & Dwight also makes Brillo scouring pads and other consumer products, as well as specialty products for industrial customers.

Century-Old American Tradition: Beginnings in 1846

The company was founded in New York City in 1846 as John Dwight & Co. by Dr. Austin Church and his brother-in-law John E. Dwight, who had begun processing and packaging baking soda in powdered form in his kitchen. It was marketed for use in home baking. In 1867 two sons of Church formed Church & Co. to compete with John Dwight & Co. The Arm & Hammer trademark derives from that year, in which Church & Co. acquired a spice and mustard business named Vulcan Spice Mills that used an arm and hammer&mdash′esumably about to descend on an anvil&mdash its trademark because Vulcan, the Roman god of fire, was associated with the forging of metals.

Church & Co. began, in 1888, issuing trading cards bearing the Arm & Hammer trademark to publicize its baking soda and saleratus (potassium bicarbonate) products. In 1896 it merged with John Dwight & Co., which also was issuing trading cards for its "Cow" brand of baking soda, to form Church Dwight Co. The merged firm continued to market baking soda under both the Arm & Hammer and Cow trademarks for some time. Arm & Hammer Super Washing Soda was introduced in the 19th century as a heavy-duty laundry and household cleaning product. About 1915 Church Dwight began suggesting that baking soda could serve as medicine, offering a booklet titled "Home Remedies for Simple Ailments." Soon it was also advertising baking soda as a tooth cleaner and a cleaner and freshener for laundry and for kitchen surfaces. The firm was incorporated as Church & Dwight Co. in 1925.

Church & Dwight was run by family members in highly conservative fashion for the next four decades--so much so that the company earned more in some years from its investment portfolio than from operations. When its methods of producing baking soda became obsolete, it turned to outside suppliers for the product. When the output of these suppliers proved insufficient, Church & Dwight, in 1968, completed what soon became the world's largest facility for the production of sodium bicarbonate, in Green River, Wyoming.

In 1968 Church & Dwight was producing nearly half of the sodium bicarbonate and borax in the United States, in collaboration with Allied Chemical Co., a major producer of the sodium carbonate (soda ash) used--along with carbon dioxide&mdash the raw material for baking soda. Its production plants, in Syracuse, New York (for consumer products) and Green River (for industrial products), were receiving soda ash from Allied's own adjacent plants and turning out about 100,000 tons of sodium bicarbonate a year. Nearly half was going to bulk industrial users, such as baking, pharmaceutical, and fire extinguisher companies. The rest was processed into granules, placed in yellow boxes bearing the Arm & Hammer trademark, and sold to the public. Church & Dwight was accounting for at least 90 percent of U.S. consumer sales of baking soda. Washing soda (also manufactured by the company) and borax (purchased from suppliers) was accounting for about 40 percent of the company's total sales volume.

Exploiting the Arm & Hammer Name Through the 1980s

About this time company management belatedly realized that housewives who, traditionally, had used Arm & Hammer baking soda as an all-purpose problem solver&mdashø bake bread, clean stains, eliminate odors, relieve indigestion, and alleviate the pain of minor burns and abrasions--had turned to an array of specialized products for all of these uses. Accordingly, under Dwight C. Minton, a fifth-generation descendant of Austin Church who succeeded his father as Church & Dwight's president in 1969, and Robert A. Davies III, vice-president of Arm & Hammer marketing, the company itself began to specialize.

Church & Dwight exploited the venerable Arm & Hammer name to market baking soda tablets for indigestion and mint-flavored ones as a mouth freshener. It also began marketing a phosphate-free laundry detergent based on soda ash and introduced an underarm deodorant (which failed) and oven cleaner, all under the Arm & Hammer name. Net sales rose from $22.4 million in 1969 to $77 million in 1975, and net income increased more than fourfold to $3.8 million during that time period.

In addition, a brilliantly successful advertising campaign begun in 1972 persuaded housewives to open the basic yellow box and place it in the refrigerator for use as a deodorant/freshener. Sales of the box rose 72 percent within three years. To stimulate sales even more, a follow-up campaign advised consumers to remove the contents after a while and pour them down the kitchen drain to deodorize it, too. Yet another ad campaign impelled consumers to store the box in the freezer for the same purpose. "There are at least 10 guys running around New York claiming some credit for the refrigerator campaign idea," adman Gerald Schoenfeld told Jack J. Honomichl of Advertising Age in 1982. The company also added a bigger box of Arm & Hammer baking soda for heavy-duty applications, such as use in swimming pools and septic tanks, and created new packaging for use as cat litter deodorizer.

Davies became president of Church & Dwight in 1981, although Minton remained chief executive officer. That year the basic yellow box of baking soda accounted for about one-third of the company's sales volume of $127.1 million. Its main end use now was to deodorize refrigerator air. (In 1970 the main use had been the cleaning of refrigerator surfaces.) The second most important use was general household cleaning. Other uses in 1981 included water treatment; cleaning refrigerator surfaces; skin rash treatment; deodorizer for rugs, kitchen drains, septic tanks, or cat box litter; and swimming pool treatment. The product's use in home baking now appeared to be negligible. Arm & Hammer had unaided recognition among 97 percent of U.S. female heads of households. Almost all grocery stores stocked the yellow box, and surveys found that, at any point in time, about 95 percent of all U.S. households had one or more packages in use in the home.

Church & Dwight opened another manufacturing plant in Old Fort, Ohio, in 1980. Four years later it purchased the Syracuse plant of Allied Corp. (formerly Allied Chemical Co.) for $14 million. The company's Canadian subsidiary also owned a plant in Ontario. Church & Dwight moved its headquarters from New York City to Piscataway, New Jersey, in the late 1970s, and to Princeton, New Jersey, in 1985.

Church & Dwight reformulated and reintroduced its dry laundry detergent at a lower price in 1981 and introduced a carpet and room deodorizer in 1981 and an oven cleaner containing no sodium in 1982. Liquid detergent was introduced to the metropolitan New York City area in 1984. In the same year the company began testing its own toothpaste and tooth powder, both with baking soda. In addition, Church & Dwight started marketing a deodorizing spray and a carpet freshener containing baking soda and a bleach and a fabric softener for sheets without baking soda. All of its consumer products, including washing soda, continued to bear the Arm & Hammer name. Although shares of company stock were being traded over the counter, most were held by descendants of the founders or employees.

Church & Dwight's Chemicals Division was producing two-thirds of all sodium bicarbonate sold to U.S. industrial customers in 1986. The division had found a recent customer in the animal feed industry, which applied it as an antacid supplement for dairy cattle. Church & Dwight purchased a 40 percent share of a British firm, Brotherton Chemicals, in 1985, for the industrial sector of its business and increased its stake to 80 percent in 1987. Of the firm's $231.4 million in sales that year, however, 78 percent came from consumer products marketed by the Arm & Hammer Division.

In 1986 Church & Dwight acquired and absorbed DeWitt International Corp., a producer of over-the-counter pharmaceuticals and health and beauty aids. Also that year, the company began a relationship with Armand Hammer, the flamboyant chairman of Occidental Petroleum Corp. Tired of having to reply in the negative when asked if he was the "baking-soda king" because of the resemblance between his name and the Arm & Hammer trademark, Hammer purchased about five percent of Church & Dwight's shares for about $15 million, receiving a seat on the company board, so he could reply in the affirmative. As part of the transaction, Occidental and Church & Dwight formed a joint venture to continue the manufacture and marketing of potassium carbonate products at an Occidental-acquired plant in Muscle Shoals, Alabama, whose customers included Church & Dwight. In 1991, after Hammer's death, his successor sold Occidental's stake in Church & Dwight for $19 million, but the joint venture remained in effect.

Church & Dwight in the 1990s

Church & Dwight's net sales of $428.5 million in 1990 was an increase of more than fourfold in a decade, and its net income of $22.5 million was about three times the 1980 figure. The company now had 12 facilities, including three in England and one each in Australia, Malaysia, and Singapore. Its laundry detergent now accounted for one-third of all revenues and ranked third in the United States after Tide and Surf. The company also held 60 percent of the world market for sodium bicarbonate. Arm & Hammer Dental Care toothpaste, introduced nationally in 1988, held 11 percent of the U.S. toothpaste market in 1993. Specialty products included ArmaKleen, a baking soda-based cleanser of computer circuit boards. In 1994 Church & Dwight established a division within its specialty products group to develop industrial cleaning solutions based on baking soda, and two years later it began selling cleaning products to the metal cleaning industry.

In 1994 Church & Dwight introduced a line of stick and roll-on deodorants in major U.S. markets under the name Arm & Hammer Deodorant Anti-Perspirant with Baking Soda. It also purchased the remaining share of Brotherton Chemicals. But sales dipped by $17 million that year, and the company's profits fell 77 percent. Minton attributed the poor results to introducing too many new products. One of these was a liquid detergent more concentrated than other leading brands that fared poorly in the marketplace and had to be reformulated because consumers thought they were being offered less for their money. Another was Peroxicare, a toothpaste with peroxide as well as baking soda that may have been competing, to the detriment of both, with Arm & Hammer Dental Care in the fiercely competitive dentifrice market.

Church & Dwight was still struggling to regain its momentum when Davies, who had left the company in 1984, was renamed president in 1995. He also was named chief executive officer, succeeding Minton, in November of that year. Although sales dropped again in 1995, the company took in record revenues of $527.8 million the next year and more than doubled its net income. That year the company also introduced sensitive-formula, extra-whitening, and smooth spearmint toothpaste variants and stick underarm deodorants. Results were even better in 1997. That year Church & Dwight acquired a group of five household cleaning brands from The Dial Corp. Among these was Brillo scouring pads. It also introduced nationally an aerosol deodorant antiperspirant.

In 1998 Church & Dwight acquired the Toss 'n Soft brand of fabric softener dryer sheets from Dial and combined it with Arm & Hammer Fabric Softener Sheets under the Arm & Hammer Fresh & Soft brand name. The company also was offering more differentiated baking soda products, such as Arm & Hammer Super Scoop, an anticlumping cat litter introduced nationally in 1997, and Arm & Hammer Dental Care Gum, a baking soda-based oral care product introduced in 1998 in three flavors. Church & Dwight had record revenues of $684.4 million and record net income of $30.3 million in 1998.

In 1999 Church & Dwight launched a multimillion-dollar advertising campaign intended to "reeducate America on the benefits of deodorizing the fridge, and offer added convenience," according to a company executive quoted by Christine Bittar in Brandweek. Spots to air in the spring and fall were to encourage seasonal replacement of a new baking soda box dominated by the color blue rather than the familiar yellow package. The company also introduced an Arm & Hammer Advance White line of dentifrices in early 1999. Also in 1999, Church & Dwight formed a joint venture with Safety-Kleen Corp. called ArmaKleen Co. to distribute Church & Dwight's proprietary line of aqueous cleaners.

In 1998 Church & Dwight was still manufacturing sodium bicarbonate at Green River and Old Fort and still retained its partnership agreement with General Chemical Corp. (formerly Allied). The company's liquid laundry detergent, previously contract manufactured, was moved to the Syracuse plant in 1995. The manufacture of powdered detergent, also being produced in Syracuse from light soda ash, was to move to Green River in 1999. Cat litter was being manufactured in both Green River and Syracuse. A Lakewood, New Jersey plant acquired in 1998 was manufacturing the underarm deodorant line and was to begin producing dentifrice products in 1999. The Brillo product line and the dryer sheets were being produced at the London, Ohio plant acquired from Dial Corp. Other company products were being manufactured by contractors.

Church & Dwight, in early 1999, also owned, through subsidiaries, a distribution center in Ontario, Canada, and a manufacturing facility in Wakefield, England. The Canadian subsidiary was leasing offices in Toronto. A Venezuelan subsidiary was closed in 1998. Church & Dwight still had a half-interest in the Armand Products potassium carbonate manufacturing plant in Muscle Shoals. Its executive offices and research and development facilities, owned by the company, were in Princeton, and it was leasing space in two buildings adjacent to this facility.

Consumer products accounted for 82 percent of Church & Dwight's revenues in 1998. Among these were Arm & Hammer Dental Care toothpaste, tooth powder, gel, tartar-control formula and gel, Peroxicare, and tartar-control Peroxicare. Two underarm deodorants were available in various scented and unscented stick, aerosol, and roll-on forms. Its line of specialty products consisted of sodium bicarbonate for commercial baked goods and as an antacid in pharmaceuticals, a carbon dioxide release agent in fire extinguishers, an alkaline agent in swimming pool chemicals, and an agent in kidney dialysis. Sodium sesquicarbonate and a special grade of sodium bicarbonate were being sold to the animal feed market as a food additive for use by dairymen as a buffer, or antiacid, for dairy cattle.

Church & Dwight's largest shareholders at the beginning of 1999 were Gabelli Foods, Inc., which held 8.4 percent, and FMR Corp., which held seven percent. Company debt of $48.8 million at the end of 1998 compared with only $7.5 million at the end of 1996.

Principal Subsidiaries: Armand Products Co. (50%); Brotherton Specialty Products Ltd. (Great Britain); C&D Chemical Products, Inc.; Church & Dwight Ltd./Ltee; DeWitt International Corp.

Principal Divisions: Arm & Hammer Division; Arm & Hammer International; Specialty Products Division.

Additional Details

Further Reference

"Arm & Hammer: Taking the Cure," Sales Management, February 15, 1970, pp. 59--60.Bittar, Christine, "In-the-Box Thinking," Brandweek, January 25, 1999, p. 3.Gordon, Mitchell, "Profitable Pairing," Barron's, September 6, 1982, pp. 37--38.Honomichl, Jack J., "The Ongoing Saga of 'Mother Baking Soda'," Advertising Age, September 20, 1982, pp. M2--3, M-22.Jacobs, Sanford L., "And Now We Discover a Miracle Product That's Not So New," Wall Street Journal, March 21, 1973, p. 1.Marinelli, Tom, "A 'Soda' Supplier for 140 Years Is Diversifying," Chemical Week, May 7, 1986, pp. 78--79.Montana, Constanza, "Armand Hammer and Arm & Hammer Finally Arm in Arm," Wall Street Journal, September 23, 1986, pp. 3, 18."The New Face of Arm & Hammer," Business Week, April 12, 1976, p. 60.Nulty, Peter, "No Product Is Too Dull To Shine," Fortune, July 27, 1992, p. 96."A Smell-Less Story," Forbes, August 15, 1974, p. 29."Sodium Bicarb Expansions Put C&D on the Offensive," Chemical Market Reporter, July 22, 1996, pp. 3, 18.Somasundaram, Meera, "Missteps Mar Church & Dwight's Plans," Wall Street Journal, April 28, 1995 (on ProQuest database).Treadwell, T.K., "The Legacy of ... Church & Dwight Trade Cards," Antiques & Collecting, January 1991, pp. 26--28.Weisz, Pam, "Church & Dwight in Need of Next Big Idea," Brandweek, November 13, 1995, p. 8.

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