Men and Rubber: The Story of Business
Founder's account of building Firestone; business sense from the tyre trade
Summary
Firestone, writing with Samuel Crowther in 1926, describes how he built the Firestone Tire and Rubber Company, from selling rubber-tired buggies in Ohio to supplying Ford and to fighting the British rubber cartel over raw material prices. The book combines memoir with the author's general views on business.
The operating content covers the early tire business, the decision to focus on the pneumatic tire when solid tires dominated, the relationship with Henry Ford as a customer and friend, the vertical move into rubber plantations in Liberia when the Stevenson Plan restricted British-controlled supply, and the management of a cyclical commodity-input business. Firestone is direct about the 1920 to 1921 collapse, when the company nearly failed because it held inventory bought at high prices, and about the cost discipline he imposed afterward.
The general business philosophy occupies much of the book: that thought must precede action and that most businessmen substitute activity for thinking, that a business should grow from what it knows rather than by acquisition, that debt should be avoided because it removes the freedom to act in a downturn, and that money follows from doing the work well rather than being the object. The camping trips with Ford, Edison and Burroughs appear as a recurring device. The book is a period piece, written in an era when businessmen produced this kind of homily, and readers should note that Firestone's account of his own decisions is unverified and self-serving in the usual ways. Its continued circulation among founders rests on the plain statements about thinking, capital and cycles rather than on the tire industry detail.
Key takeaways 7
- Most businessmen substitute activity for thought, and the discipline of setting aside time to think about the business is what separates the ones who compound.
- A company should extend into what it already knows rather than acquire businesses it does not understand.
- Debt removes a company's freedom of action precisely when a downturn makes that freedom most valuable.
- Holding inventory purchased at high prices is the mechanism that destroys commodity-input manufacturers during a price collapse.
- Controlling raw material supply becomes necessary when a cartel or a government restricts it, and Firestone's Liberian plantations were a response to the British rubber restriction scheme.
- Selling price should be built up from actual cost rather than set by what competitors charge, since a firm that does not know its own cost cannot survive a price war.
- Profit follows from doing the work well and should not be the object of attention itself.
Who should read it
Founders who want a plain first-hand account of building a manufacturing business through commodity cycles, read as period memoir rather than as verified record.
Where it sits in the reference 2
Who recommended it 2 · 2 direct
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