Author: Beat H. Haering
LessenbyPDFtea

It was the autumn of 1840 when Lady Lessenby sat with her friend, Alice Sumner, in the salon of their London townhouse. The butler had just served afternoon tea to the ladies. After taking her first sip, Lady Lessenby turned to her butler, “James, when do we expect the new harvest to arrive from China?” “The first ship is expected to arrive any day. Our supplier has strict instructions to deliver ten pounds of it, as soon as the new teas arrive, my lady.” After another sip, Lady Lessenby exhaled slowly, saying, “I am so tired of this tea and I am afraid I can’t wait much longer.

At the same time, Jeremy Hard was nervous, very nervous, as was always the case in this season. “Is there any news from the port?” – a question he had addressed to his office manager almost every hour. Jeremy Hard was a tea merchant and supplied some of the most prestigious addresses in London. He knew that his demanding customers were desperately waiting for the new tea harvest from China. For this, they were willing to pay almost any price. The success bonus for the first ship to reach the quay, was an additional 5 shillings per pound of tea. In the last two years he had been lucky and had chosen the fastest sailor for his cargo.

Three years ago, however, he wasn’t so fortunate and his shipload only reached the port of London after two others. Not only did teas of the second or third delivery achieve significantly lower prices, but worse still, he also lost two dozen of his top-notch customers, who changed their tea order to his competition for the next year. In the meantime, it had become a social status symbol in London and elsewhere in the United Kingdom to be able to offer guests the very first tea from the new harvest.

To calm his nerves, Hard ordered his coachman to drive him to the docks where all kinds of ships moored: schooners, square-riggers, brigs and even one of the first steamships were in port. As a son of London he knew the different types of ship well, which was an substantial advantage in his business. This meant he was able to estimate which of the ships had a good chance of coming back first from Foochow, the most important port in China for the tea trade, although the ability of the captain and his crew were also a factor.

Suddenly he stopped. In front of him lay a ship of a design he had never seen before. Unlike the others it was streamlined with a particularly sleek bow and wide stern. Without much thought, he boarded and asked for the captain. Here he learned that this ship, named “Scottish Maid” had been built only a year ago in Aberdeen. It was the first British ship that insiders referred to as a “Clipper” and whose special structure was designed for particularly fast crossings. It was used along the British coast and was intended to increase competition with the newly established railways. Speed had become an important selling point.

Jeremy Hard thoughtfully left the “Scottish Maid”. Such a ship in a much larger, highsea design could offer the decisive advantage in the competition for the delivery of the new tea harvest that he was looking for. The more he thought about it, the more his plan evolved: he wanted to use these advantages exclusively for his tea trade. But as a result for it, he had to become the ship’s owner himself.

Jeremy had become a wealthy man over the years, always looking for lucrative investment opportunities, and the more he thought about it, the more he became certain to have found a highly lucrative business case with a high-sea clipper. He already knew his way around the tea trade, which gave him the confidence he needed to become successful.

In fact, the British mercantile marine adopted the Clipper concept (which originally came from the United States) and revolutionized trade with China. The first Clippers were built of wood with a relative short lifespan due to the extraordinary stress on the material. With the invention of composite construction, steel became a central element in shipbuilding and this structure led not only to longer lifespans but also to larger ships with more freight capacity.

The Clipper’s heyday was between 1840 and 1870 but as fast as the Clippers appeared on the oceans, they soon disappeared again. New upcoming structures; the economic competition with even faster ships and the opening of the Suez Canal in 1869 (see Future Today Letter No. 3), were solutions that didn’t depend as heavily on the wind and eroded the Clipper’s competitive edge.

But the legend remains. Well remembered was the great tea race of 1866, in which the Clipper Taeping won after a 99-day race from China reaching the port of London only 20 minutes before the Ariel, literally head-to-head.

In the case of the Tea-Clippers, history shows how flexible structures must be to achieve a decisive advantage for a relatively long time and how quickly challenges can be successfully met by alternations of structures.

And because change is the only constant in life, Carey´s Logo for the structure business – a sailing ship – is the best symbol for mastering that change.

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At CAREY, we are specialists in setting up and managing advantageous structures for our customers and we would be pleased to establish a private “Clipper” Structure in form of a company, trust, foundation or off-shore Fund whenever you are ready. We are here for you today, tomorrow or whenever you call us.

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CAREY ZURICH
Carey – since 2003 your trusted partner for private and corporate structures, Private Equity Funds and Financial Reporting. Our clients can count on Swiss quality and standards, efficiency and trust. Committed only to our clients, we always choose the best available options without incurring any risk of potential conflicts of interest. We are a member of the Self Regulatory Organization (SRO) and therefore certified by the Swiss Financial Supervisory Authority (FINMA) in accordance with the Swiss Anti-Money Laundering Act.