Charles Arbuckle died in 1891, and John Arbuckle admitted as partners his nephew, William Arbuckle Jamison, and two employees, William V.R. Smith and James N. Jarvie, the business continuing under the former name of Arbuckle Bros. The most important step taken by the firm while thus constituted was its entrance into the sugar refining business in 1896. That entrance had to be forced against the bitterest opposition of a so-called sugar trust, and brought on a "war" signalized by the most ruthless cutting of prices of both coffee and sugar. This war was costly to both sides; but when it had ended, Arbuckle Bros. remained unshaken in the preeminence of their package-coffee business and had acquired also great publicity and a fine trade in refined sugar.
John Arbuckle
Arbuckles were always large consumers of sugar in connection with their coffee glaze, and having introduced the package sugar idea with their customers some years before, they at last made up their minds to refine for their own needs and thus to save the profits paid to "the Havemeyers". It is generally conceded that John Arbuckle's shrewdness and business sagacity in having previously acquired the Smyser patents on a weighing and packing machine, and his control of it, really led to the coffee-sugar war. "This packing machine", said the Spice Mill, when Henry E. Smyser died in 1899, "puts him [Smyser] with the greatest inventors of our day."
The sugar trust met the Arbuckle challenge by invading the coffee-roasting field. This they accomplished by securing a controlling interest for $2,000,000 in one of the largest competing roasting plants in the country, that of the Woolson Spice Co., of Toledo, Ohio, that had in the Lion brand, a ready-made package coffee wherewith to fight Ariosa. The re-organization of the Woolson Spice Co. in 1897, when A. M. Woolson was relieved of the office of president, disclosed, among others, the names of Hermann Sielcken in close juxtaposition to that of H.O. Havemeyer on the board of directors. Both men helped to make coffee-trade history.
The trade found the coffee-sugar war the all-absorbing topic for several years. Hot debates were held on the question as to whether, on one hand, the Arbuckles had the right to enter the sugar-refining business and, on the other, as to whether the sugar-trust had a right to retaliate. The answer seemed to be "yes" in both instances.
In two years, John Arbuckle's model sugar refinery in Brooklyn was turning out package sugar at the rate of five thousand barrels a day. The Woolson Spice Co. was credited with spending unheard-of sums of money in advertising Lion brand coffee. The eastern newspaper displays alone exceeded anything ever before attempted in this line. However, many people are of the opinion that it was a tactical error on the part of the sugar interests to spend so much money advertising a Rio coffee in the central and New England states, while John Arbuckle was confining his activities to the south and the west, where there already existed a Rio taste among consumers.
The legal fight which the Arbuckles carried on with the Havemeyers for the control of the sugar business in this celebrated coffee-sugar war is said to have cost millions on both sides.
Eventually, the Havemeyers were glad to be relieved of their coffee interests, but John Arbuckle continued to sell both coffee and sugar.