Andrew Carnegie's Business Methods

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The purpose of this paper is to compare Andrew Carnegie’s business methods with those of John D. Rockefeller. Andrew Carnegie and John D. Rockefeller were both men of their times who rose from non-affluent backgrounds to become some of the richest men on Earth. The methods that they used were in some ways very similar and in some ways very different. Rockefeller was in the oil industry and Carnegie was in the steel industry. Rockefeller created the Standard Oil Company that handled 90% of America’s oil industry by 1890. Carnegie created Carnegie Steel corporation. They were very similar in the way that they rose to power, but there were some differences. Rockefeller and Carnegie both took control of all the other businesses that were related to their product (steel and oil), in a process called vertical integration. Rockefeller and Carnegie also both took control of the other businesses that were providing their product (steel and oil), in a process called horizontal integration, which would lead to them both virtually becoming monopolies.

One method that both Rockefeller and Carnegie used was vertical integration. Vertical integration is when one business in an industry makes deals or …show more content…
Horizontal integration is when one business buys out all the other businesses on the market. Horizontal integration can lead to a monopoly. Rockefeller’s problem with using horizontal integration was that Ohio state law wouldn’t allow a company to buy any stock of another company. Rockefeller got around this by creating a trust. In a trust, all the different organization assign their stock to a board of trustees. The board of trustees then combines them into a new organization. Rockefeller’s oil company, U.S. Standard Oil, bought out many other companies, including Clarke, Payne & Company. At one point, Rockefeller’s company controlled 90% of the nation’s oil supply, making it almost a

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