This Day in Jewish History

1971: Sam Bronfman Dies, Mercifully Before His Empire Did

It took decades for Samuel Bronfman to build the biggest alcoholic drinks company in the world. It took rather less time for his heirs to ruin it.

MobiusDaXter, Wikimedia Commons

On July 10, 1971, the Canadian Jewish businessman Samuel Bronfman, who built the biggest producer and distributor of alcoholic beverages in the world – Seagram Co.,died, at the age of 82. The task of running the company into the ground was accomplished in much shorter time by his grandson Edgar Bronfman, Jr., together the help of Jean-Marie Messier, who had turned a picayune sewerage company, Vivendi, into a global media empire – and who did rather the opposite with Seagram.

Samuel Bronfman was born on February 27, 1889, in the town of Soroki, then part of the Russian empire, today in Moldova. His mother was the former Mindel Elman. His father was Yechiel Bronfman, a prosperous owner of a tobacco plantation.

The family was wealthy but czarist Russia was not a secure place for Jews in those years. Shortly after Samuel’s birth, Yechiel moved the family to Saskatchewan, Canada, where the Jewish Colonization Association was offering homesteading assistance to Jewish immigrants settling in a town called Wapella.

The Bronfmans, who traveled with two servants and a Hebrew teacher for the children, didn’t stay long in Wapella, which proved too cold for tobacco farming. Soon, they moved on to Brandon, Manitoba, one province to the east.

Yechiel, by now calling himself Ekiel, sold firewood, then frozen whitefish, and finally began trading in horses.

Hutcher, Wikimedia Commons

Family lore says it was 11-year-old Sam who, while accompanying his father on his rounds, observed how much alcohol was sold in the hotels where they met clients. Acting on that, Ekiel went ahead and bought one, the Anglo-American Hotel in Emerson, Manitoba, in 1903.

Bed, breakfast and booze?

By 1918, the family owned three hotels. But Sam and his older brother Harry stripped down the business to focus on the profitable alcohol trade.

In the United States, Prohibition was national, and both manufacture and sale of alcohol were outlawed. In Canada, it was implemented on a provincial basis, and didn’t forbid production, among other loopholes. So while Sam Bronfman may have been a bootlegger when he exported to the lower 48, in Canada, he was a law-abiding businessman – more or less. And while Prohibition was good for business, the repeal of Prohibition was great for it.

Within a decade, under Sam’s leadership, the Bronfmans went from distributing booze, to bottling and selling artificially “aged” whiskey, to importing some of Scotland’s most prestigious brands of spirits. In 1924, Sam established the Distiller’s Corporation, in Montreal. Four years later, he bought out the far more reputable Joseph Seagram & Sons, which produced such labels as Dewar’s and Seven Crown.

That royal feeling

As a Jew in a provincial country not quick to embrace newcomers, Sam Bronfman was sensitive to social status. This made him a natural at marketing, as he grasped intuitively as he did that how labels with regal-sounding names and coats of arms could be used to make consumers feel they had arrived. He also understood, for example, that lending the Seagram name to a campaign encouraging “responsible drinking” could actually be good for business.

When Prohibition ended, in 1933, Seagram had millions of liters of truly aged whiskey ready for open sale south of the border, and worldwide.

Sam innovative in that his business involved production, blending and bottling, and soon came to include spirits of all kinds, including wine. By the end of 1936, Seagram was selling $60 million of product. By 1965, its annual turnover surpassed $1 billion.

By then, the firm was so cash-rich, it began investing in oil, and then, in the 1980s, it bought a large stake in the chemical giant DuPont. That led eventually to the purchase, under the stewardship of Edgar Bronfman, Jr., in the ‘90s, of MCA and Polygram.

Then came the sale of everything to Jean-Marie Messier’s Vivendi, and to Pernod-Ricard and Diageo. In short time, the value of the assets had declined so dramatically that Vivendi  had to sell both the Seagram Building in New York and its acclaimed art collection.

Fortunately, Sam Bronfman did not have to witness the dismemberment of his company. By then, he had been gone for 40 years.

The Seagram's headquarters in New York (Photo by Jesse David Harris)