For a long time, I thought Charles Schreiner’s wealth came mainly from his Kerrville store and bank. Later, I added his real estate investments, not just in towns like Kerrville and neighboring communities, but also the numerous ranches he owned. By 1900, he owned around 600,000 acres stretching from Kerrville to Menard.
Schreiner also nanced and organized great cattle drives north to the markets in Kansas and elsewhere, which often were quite pro table.
Add to these the corporate boards on which he served, mostly for companies in which he’d made investments, including the San Antonio and Aransas Pass Railroad and the original National Bank of Commerce.
Any one of these would have made Charles Schreiner a comparatively wealthy man, and would have made him very similar to other Texas businessmen of that era.
It seems most Texas towns had a primary mover — the one person who owned the bank, the water system, the electric system, the telephone system in their little town.
Lately, though, I’ve thought the true source of his wealth was something else, something I would have never guessed, and that source differentiates Schreiner from the other Texas successes.
Schreiner created at least two local commodities markets that served international buyers: a market for wool, and, to a lesser extent, a market for mohair.
Sheep and goats, in those days, were anathema to most cattle ranchers, but Schreiner championed these livestock in several important ways.
First, through his bank, he in uenced ranchers to diversify into sheep and goats. Basically, many of the loans to ranchers for livestock stipulated that some of the capital was to be spent on sheep and goats. I’m sure this was not always well received, but there was cleverness in Schreiner’s policy.
Sheep provided an opportunity for pro t at least twice a year, when the wool was clipped, plus the additional opportunity for sale as meat; goats offered similar advantages to cattle.
These ber products also helped Schreiner build a market for what was possibly his most clever enterprise: wool and mohair warehousing.
He ran a huge wool and mohair commission business. While he cannot be credited with creating this concept, one could certainly argue he perfected it. In fact, there was a time when Kerrville — little
Kerrville, on the edge of the Chihuahuan Desert, far from any large cities — was credited with more mohair commission sales than any other market in the world.
Schreiner had, in other words, not only created a market for these fibers, but he had cornered that market.
In the late 1800s, Schreiner’s name is found in the San Antonio newspapers in association with his wool commission business. By the late 1880s, Schreiner was selling more than 1 million pounds of wool, receiving bids from buyers all over the world. Newspapers of the time say 1 million pounds of wool equaled 35 train car loads.
At the turn of the last century, Schreiner was selling about 1/6 of all wool produced in the entire state of Texas, according to newspaper accounts from the time period.
That amazes me.
Schreiner himself did not raise the sheep and goats that produced all of this wool and mohair, nor was all of it produced on ranches he owned. Here’s where his business genius can be appreciated: He created a stable market for these commodities.
That meant the sheepmen and goat raisers, who labored to raise the sheep and goats, keeping them fed while moving them from range to range, protecting them from harm, doctoring their illnesses and wounds, and providing for the wool or mohair to be clipped, all while taking on enormous risks — these stockmen had a reliable market for their products. They did not have to bear the additional risk of finding a market for their wool and mohair.
Schreiner provided them a market, which gave them a fair market price, and a place to bring their clips. He also collected a commission on every pound of wool and mohair he sold.
I’ve known some very successful businesspeople, and I’ve read about many others since my days at the university.
Schreiner’s story is different.
The thing about Charles Schreiner’s business achievements that really amaze me is not his lack of formal business education, and not his ability to build a series of businesses that interlocked so closely together, each supporting the others in an almost vertical integration — no, the astonishing thing about Schreiner’s outstanding success is that it was done in a remote, isolated community, without the benefit of reliable transportation or communication.
Using an initial source of capital, first through a partnership with his brother-in-law, Caspar Real, and then later through a partnership with August Faltin, Schreiner created new capital with hard work, innately realizing the benefits of treating others well and providing them value, and a shrewd sense of the possibilities of the Texas frontier.
Until next week, all the best.
Joe Herring Jr. is a Kerrville native.