How Is John D Rockefeller Successful

John D Rockefeller of New York is best known today as one of the most successful businessman in American history. Like most successful figures in history, Rockefeller was not born into his fortune. Originally a New York native, young Rockefeller relocated to Cleveland, Ohio in the 1860s, where he soon became involved with the oil fields in western Pennsylvania. After spending some time in the business, Rockefeller decided that it was too risky and his talents would be better suited in the refining business. Shortly after, Rockefeller found himself thriving with success and was ready to “strike out on his own”. In 1870, with the help of Samuel Andrews and H.M. Flagler, the men pooled their interests together to form the Standard Oil Company of Ohio. It was not long thereafter that their new business became the largest refiner in the country. However, as the oil industry
began growing, so did public interest. Consequently, the increased interest caused a period of deflation in prices on oil. Rockefeller was in great distress over the deflation, as he saw it,his business would soon be in ruins. Rockefeller was an ambitious man, so seeing his business going under was not an option. To prevent his business from failing, he decided the only thing to do was drive all of his competitors out of business. With Rockefeller's work history in the railroad industry, he was able to utilize them for a business advantage. Over the years Rockefeller had become a reputable customer to the railroad industry, which ultimately aided him in cutting down on shipping costs. Rockefeller knew the railroads needed his business as much as he needed theirs, making it easy for him to cut deals with the companies. In order for the companies to continue having his business, they would have to give him astronomical rebates in return, that were exclusive to only his business. Rockefeller's tactic greatly minimized one of the largest costs for his business. Growing tired of his competition all together, Rockefeller decided to put an end to the chaos once and for all.
Rockefeller was a man who always had a “leg up”, so he knew what his competitors were or were not generating as profit. Making this known to his fellow oil men in Cleveland, he graciously offered to buy their businesses out, saving them from a great loss. This worked so well that by 1879 Standard Oil was in control of approximately 90 percent of the entire oil industry. While it might seem that Rockefeller built his fortune on bargaining, negotiations and scheming, he did use other business tactics to help further his company. Like most great business persons, at the forefront of Rockefeller's mind was always, “How can I maximize my profit?”, it is apparent that all of the methods he used reflected that. One of several business tactics Rockefeller is known for is vertical integration. Whether it be huge or minute, Rockefeller wanted ownership of all things manufactured related to his oil business. Vertical integration allowed him to solely make profit without any money going
out. Rockefeller was most notably known for his trusts. In essence, he managed and maintained properties that belonged to others. Trusts were also somewhat of a legal “loophole”. By putting companies in a trust, Rockefeller could run them without legally owning them. This gave Standard Oil the power to operate without getting caught up in laws against unfair business practices. Nevertheless, in the 1880s-1890s individual states began attacking trusts as unfair monopolies, eventually dissolving trusts altogether. In retaliation, Rockefeller formed a holding company. The holding company was almost indistinguishable to a trust. The only difference was a holding company only granted Standard Oil control of other companies' stock. Rockefeller was progressive for his time, which is what made him such an ingenious business man. His actions could also be said to have exhibited Social Darwinism. He believed that if he was not the best, he would fail. In business, nature and all other realms, only the strong survive.