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A NOT-SO-BRIEF HISTORY OF ALL-CLAD

Everything in this article is to the best of my knowledge, but since I’m not the CEO of All-Clad, it’s ultimately speculation and should be read as such.[1][2] This section grew so lengthy that I moved it from its original location in this post.

Back in the 1960s, aluminum extraction and refining technology had advanced to the point where aluminum became cheaper than copper. Aluminum’s excellent thermal conductivity, high heat capacity relative to weight, and relatively low cost made it an ideal material for cookware… sort of.

The main drawback to using aluminum by itself is that aluminum is highly reactive and can produce off-tastes, especially with particularly acidic foods.  Aluminum is also soft and prone to being bent out of shape. Calphalon and others got around this problem by anodizing its aluminum cookware, but John Ulam, founder of All-Clad, took a different approach. He took some bonded metal (aluminum bonded to stainless steel) left over material from his metal-bonding company formed the bonded metal into the shape of a pan, which he liked so much that he started to sell copies to friends and at local fairs. These pans conducted heat well like all-aluminum pans, but the interior stainless steel lining meant that the pan did not give off-tastes/colors like all-aluminum pans and were structurally stronger. By 1971, Ulam had established All-Clad as a company specializing in cladded cookware.

Ulam promoted his cladded cookware at trade shows and targeted restaurants at first. Then a Bloomingdale’s representative discovered and liked the cookware, and the All-Clad brand quickly grew as a premium home brand. Before long, All-Clad offered All-Clad Stainless (stainless-aluminum-stainless), Master Chef (stainless interior, thick aluminum body), and Cop-R-Chef (stainless interior, aluminum body, thin skin of copper exterior that boosted thermal conductivity slightly but was also high-maintenance due to copper oxidation; this product line was eventually discontinued). LTD added anodized exteriors to Master Chef, and D5 added a stainless steel layer in All-Clad Stainless that supposedly helps heat distribution. (It doesn’t.) All-Clad Copper Core uses a thin copper core surrounded by even thinner bonding layers of aluminum, clad in stainless on both sides. Master Chef and LTD got redesigned and renamed as MC2 and LTD2. All-Clad Stainless got redesigned in 2011.

Sometime in the 1980s, All-Clad licensed its technology to Spring, a Swiss company founded in 1946 that made restaurantware. We’ll discuss them in more detail later.

John Ulam then died from cancer in early 1989. Although I can’t find a source commenting about the timing, I think it’s more than coincidence that he sold the company in late 1988–right before his death–to Pittsburgh businessman Sam Michaels. Perhaps Ulam’s family had no inclination to run the family business, so the dying, cancer-stricken Ulam decided to sell the company.

Whatever the case, Sam Michaels’s 1988 acquisition of All-Clad continued and strengthened a marketing campaign that has never ended–even today, All-Clad gives cookware to celebrity chefs and aggressively markets its products. All-Clad’s growth rate exceeded 35% per year in the late 1990s as a result. Michaels eventually sold a majority stake to an equity fund in 1998. Shortly thereafter, the equity fund sought interested parties for a sale. In 1999, Ireland’s Waterford Wedgwood (makers of famous Waterford crystal) bought All-Clad.

Waterford’s lead shareholder and chairman, Tony O’Reilly, talked about how All-Clad’s fat profit margins surpassed margins on Waterford crystal. O’Reilly reiterated All-Clad’s no-discounts-ever policy and how he wanted to accelerate sales even faster by tapping into overseas markets.

At the time of All-Clad’s acquisition by Waterford, Waterford was becoming a conglomerate that controlled Waterford, Wedgwood, Spring, and other brands:

• Waterford. George and William Penrose started a crystalware business in 1783 in Waterford, Ireland that went defunct in 1851. The Waterford name was resurrected in 1947 by Czech immigrants fleeing Communism. The 1947 company was subsequently sold to the Irish Glass Bottle company. Waterford Crystal and Wedgwood merged in 1987 to create Waterford Wedgwood plc, a luxury crystal and ceramics maker.
• Wedgwood. Josiah Wedgwood and Sons, better known as Wedgwood, was a ceramics company founded in 1759 by, you guessed it, Josiah Wedgwood, an English potter. Through clever marketing, Wedgwood built the company into a powerhouse.
• Spring. Spring was established in 1946 by the Spring brothers. It briefly turned into All-Clad Switzerland GmbH before going down with the Waterford ship and reemerging as Spring International GmbH. Spring makes restaurantware like chafing dishes. Since the 1980s Spring has also had a close connection with All-Clad as a patent licensee.

So Waterford merged with Wedgwood in 1987, and Waterford-Wedgwood bought All-Clad in 1999, near the height of a global asset bubble.

Waterford’s moved quickly to expand All-Clad’s presence in Europe–as of 2000, All-Clad was almost entirely absent in Europe, being available in just one store in London. Waterford turned to Spring (Switzerland), an established European brand and licensee of All-Clad’s patents, as the fastest way to build All-Clad’s presence in Europe. Waterford bought Spring in May 2002 for 3.4 million euros, and Spring was renamed “All-Clad Switzerland GmbH.”

In addition to expanding All-Clad’s brand to Europe, Waterford also wanted All-Clad to expand its product lines into things besides cladded cookware, such as non-metallic bakeware. And since All-Clad was so expensive, Waterford also started a cheaper line of disc-bottomed cookware that only had aluminum on the bottom and not the sides. Waterford promoted this cheaper product line by paying a celebrity chef, Emeril Lagasse. Thus was “Emeril by All-Clad” born in 2000.

Even as All-Clad thrived in the early 2000s, things weren’t going so well for Waterford’s ceramic/crystal business. In particular, Waterford’s glassware business was in deep trouble. In an effort to boost profits, the company kept sending jobs overseas or eliminating them altogether, but consumers kept buying less product (with some complaining about the sudden reduction in quality).

By 2004, five years after Waterford bought All-Clad, Waterford’s finances were getting desperate enough that Waterford sold All-Clad to Groupe SEB of France for $250 million, a hefty profit above the $110 million Waterford paid for All-Clad in 1999. The premium was a testament to All-Clad’s stellar revenue growth rate. (Spring, by then known as All-Clad Switzerland, was not part of the All-Clad sale.)

Waterford’s sale of All-Clad gave Waterford some financial breathing room for a while, but it did not fix Waterford’s structural problems. The company kept digging itself a deeper and deeper financial hole before going bankrupt in the 2008-2009 global financial crisis, after Bank of America refused to keep extending Waterford credit.

In 2009, KPS Capital (New York) bought the remnants of Waterford and reformed them into what is today known as WWRD Holdings. WWRD promptly laid off hundreds of UK workers. Spring was not one of the rescued brands and is thus not part of WWRD Holdings.

But what of All-Clad? What has its fate been since its 2004 sale to Groupe SEB of France? And who or what is Groupe SEB anyway?

Groupe SEB is a large, profitable French kitchenware producer that has bought up well-known kitchenware brands all over the world. Groupe SEB’s North American brands include AirBake, Mirro, T-Fal, Wearever, and of course, All-Clad. Groupe SEB also owns other brands like Lagostina, KRUPS, Rowenta, TeFal, and Moulinex. (T-Fal and TeFal are the same brand and stand for (Tef)lon(Al)uminum, but DuPont objected to TeFal’s spelling as being too close to “teflon,” so in English-speaking countries you see “T-Fal” advertised instead of “TeFal.”)

Let’s look at All-Clad through the eyes of Groupe SEB’s CEO in 2004. (Obviously I’m speculating, as noted in my disclaimer at the head of this article, but bear with me.)

So you’re Groupe SEB’s CEO. The year is 2004. You just bought a company whose original patents on All-Clad Stainless from the 1970s are expiring. This is a big deal, because All-Clad Stainless (stainless-aluminum-stainless) is your best seller. Competitors can now legally clone All-Clad Stainless at lower cost overseas, and if their products are comparable to the real thing, this can potentially cripple All-Clad’s sales.

Don’t hit the panic button yet. The company you bought was aware of how its patents on All-Clad Stainless would expire in the 2000s. So All-Clad introduced D5 and Copper Core. Those new lines aren’t much better than Stainless, but they do have patent protection that will last many years longer, so the company has been pushing them onto consumers, hoping to upsell them by including flared rims and finger guards in D5 and Copper Core as a way to differentiate them from regular All-Clad Stainless.  (Flared rims curve outward from the interior of the pot, making drip-free pouring easier.)

As a fallback, All-Clad in 2000 set up its own Chinese production (fight fire with fire). The company did not want to harm the “made in USA” reputation of All-Clad proper, though, so it merely established a line of disc-bottom pieces and hired celebrity chef Emeril Lagasse to promote the line (“Emerilware” or “Emeril by All Clad”). It’s one of the fastest-growing revenue sources you have at All-Clad now, in 2004, and establishes a relationship with Chinese suppliers in case we need to move the rest of All-Clad’s production overseas someday.

Fast forward to 2008. You are CEO of a company at a crossroad. All-Clad brands are suffering price pressure from relentless competition. Rivals like Calphalon and Tramontina and Cuisinart offer Chinese-made knockoffs that perform well enough that they threaten your best-selling product. You’re talking with All-Clad’s USA-based leaders. They are telling you that American consumers think that they can get All-Clad Stainless quality for a fraction of the price if they buy Chinese knockoffs. We need a way to reach these consumers who are unwilling to pay All-Clad Stainless prices but who want decent quality. If we do not reach out to these customers, they will simply buy our rivals’ products. We do not want to wind up a niche seller of luxury goods that few actually buy, like Waterford Wedgwood–just look at what happened to them. We need volume to keep our market share up even if margins suffer.

We can’t reach these savvy consumers with Emerilware. Emerilware is still just disc-bottom cookware, and we spent the last few decades telling everyone how cladded cookware is better than disc-bottom cookware.

One option is to move All-Clad Stainless to China so we can compete on costs on equal footing with our rivals. But that seems risky, because then we will have no way to differentiate ourselves from our rivals. “Made in USA” still means something to consumers. So let’s start moving some production of thinner All-Clad Stainless to China and call it something else, such as Emeril Pro Clad, to distinguish it from USA-made All-Clad. Additionally, let’s give Emeril Pro Clad cheaper glass lids to further distinguish it from USA-made All-Clad, which comes with stainless steel lids.

This is a pivotal moment for the company. Until now, we have only produced non-cladded cookware in China, such as lids, steamer baskets, kitchen electrics, etc. For the first time, we’re going to make cladded cookware in China too.

Fast forward to 2009. The global financial crisis has dampened demand for full-price All-Clad. On the bright side, Emeril Pro Clad has launched. With Emeril Pro Clad, we did what Calphalon did years ago: we took All-Clad Stainless, thinned it out, gave it cheaper glass lids, and manufactured it in Asia while marketing it as if it were equal to All-Clad but at a lower price point. Fight fire with fire. We are probably cannibalizing some sales of USA-made All-Clad in the process, but at least we are making money. We will survive the global financial meltdown, unlike Waterford.

Fast forward to 2011. The whole “upsell customers from Stainless to D5” thing isn’t working out that well; you have rivals like Cuisinart cloning All-Clad Stainless but using more comfortable handles and flared rims. In response, we will redesign Stainless to give it a steeper handle to make the pan more maneuverable. And from now on, we will laser-etch the All-Clad logo and pan size onto the bottom of each pan. (Side note: all of my pan tests are of the new models, which start with “4” such as this All-Clad 4112 Stainless Steel Tri-Ply Bonded Dishwasher Safe Fry Pan / Cookware, 12-Inch, Silver. If you look at an older-model All-Clad pan on Amazon, it will say that there is a newer version available.)

As of 2014, All-Clad is under heavy competitive pressure as its key patents expire, but it’s still a financially healthy company, and it will be interesting to see what they come up with next. So far, All-Clad has come out with ~1.65 mm thick copper-exterior + stainless-interior All-Clad Copper Clad (aka C2), but C2 is a solution in search of a problem. It has all the drawbacks of exposed copper (can’t put in dishwasher, less scratch resistance than stainless steel, exterior oxidizes into dull brown, not induction-compatible) but can’t even beat All-Clad’s cheaper MC2 product line (exterior thick aluminum, interior stainless steel) for even-heating, though in C2’s defense, copper heats up and cools down somewhat faster than aluminum, which some people value highly.

All-Clad came out with something else in 2014: All-Clad D7, which has four layers of stainless steel and three layers of aluminum. It’s thick–about 3.76 mm thick–so it spreads heat evenly and holds a lot of heat, too. It’s a clear attempt to steal market share away from Le Creuset and Staub’s enameled cast iron dutch ovens, made even clearer given that D7 was initially only available in stockpot/dutch oven form. Personally I think it’s overkill unless you do a lot of very high temperature searing on the stovetop. A regular All-Clad Stainless stockpot would work almost as well for lower-temperature browning. Still, it’s a nice try at something new, and by 2016 All-Clad expanded its D7 lineup to include skillets, saute pans, and saucepans as well as the original D7 pots.

Everything in this article is to the best of my knowledge, but since I’m not the CEO of All-Clad, it’s ultimately speculation and should be read as such.[1][2] This section grew so lengthy that I moved it from its original location in this post.

REFERENCES

[1]Many articles overlap. My sources for All-Clad information include:

Ulam’s obituary in the Pittsburgh Press, Feb. 2, 1989

http://old.post-gazette.com/columnists/20001015rubin.asp (High-end pots that no one would pan, by Marilyn McDevitt Rubin, Pittsburgh Post-Gazette, Sunday, Oct. 15, 2000)

http://www.gourmetretailer.com/top-story-profiles___trends-groupe_seb_purchases_all_clad_from_waterford_wedgwood-4905.html

http://news.google.com/newspapers?id=044zAAAAIBAJ&sjid=jW8DAAAAIBAJ&pg=5893%2C4544464 and http://news.google.com/newspapers?id=044zAAAAIBAJ&sjid=jW8DAAAAIBAJ&pg=4611%2C4570829 O’Reilly’s Waterford Wedgwood acquires All-Clad: High-end Canonsburg cookware maker goes for $110 million, by Patricia Sabatini, Pittsburg Post-Gazette, May 26, 1999, C1, C8 Business section.

http://triblive.com/home/2140012-74/clad-cookware-president-stainless-vice-bonded-metalcrafters-metals-product-business#axzz2jw1oLMPi Innovations by All-Clad spur revolution in cookware, by Rachel Weaver, published August 14, 2012 in the Pittsburgh Tribune-Review.

http://www.connox.com/spring.html and http://www.rove.de/c375/Spring.html?language=en

http://www.gourmetretailer.com/top-story-profiles___trends-waterford_wedgwood_acquires_spring_ag_cookware-3958.html

http://www.nytimes.com/2009/01/10/opinion/10flanders.html?_r=0 They Broke It, by Judith Flanders, Opinion Page, New York Times, January 9, 2009, discussing the demise of Wedgwood.

http://www.spring.ch/en/spring/

http://www.washingtonpost.com/wp-dyn/articles/A9411-2004Jun2_2.html?sections=http://www.washingtonpost.com/wp-dyn/business

http://www.hoovers.com/company/WWRD_Holdings_Limited/ctfrhi-1-1njhxk.html

http://www.theguardian.com/business/2009/jan/05/retail-recession

http://kochshop.eu/

[2]All-Clad’s marketing goes back a long way. Here’s an interview with All-Clad’s founder, John Ulam. Skip to 4:16.

Interviewer from WIIC-TV: Now John, is copper really better for cooking or is it just that it’s prettier? Is that why it’s so popular these days?

John Ulam (All-Clad): No, copper actually is better, only because of its high heat transfer. Now when we construct the material for Cop-R-Chef, of course we feel that you must have sufficient copper for it to actually function properly–and that means distribute the heat all the way up the sidewall.

Interviewer: Mmm hmm.

John Ulam (All-Clad): But in Cop-R-Chef we’ve gone a little further by not only having the stainless steel cooking surface, but we have placed an aluminum core between the copper and the stainless steel to give you the ultimate of heat transfer.

Here, John says copper foil on aluminum is the “ultimate” in heat transfer, but he’s wearing his marketing hat when he says that, not his scientist hat. He clarifies later that silver and copper are the best heat conductors among metal elements. A foil-thin exterior layer of copper in the now-discontinued Cop-R-Chef line isnt’ going to do much; the vast majority of the heat transfer work is performed via the aluminum.

At 5:38:

Interviewer from WIIC-TV: What kind of thing should you have in your mind when you go to look for pans to be able to evaluate whether–where you really gonna spend your money on something that’s really good or whether you’re spending your money on something that’s just chic, ’cause there are lots of those pans on the market, too.

John Ulam (All-Clad): Well, first I would say the total value is the most important thing in purchasing a cooking utensil. One, you want it to last forever.

Interviewer: Mmm hmm.

John Ulam (All-Clad): So therefore you need a cooking surface that’s going to last forever, and also that it’s going to be non pit–uh. And it will stay high–highly polished and shiny. (Editor’s note: Ulam was apparently try to say non-“pitting” but probably realized that he didn’t need to go into the specifics of corrosion resistance with such a softball interviewer.) Secondly you need the extra heat transfer that’s going to maintain the life and give you the proper, uh, cooking of your foods and the retention of, uh, nutritions and so forth (sic). (Editor’s note: heat transfer does not extend the life of stainless steel. I think what he’s trying to say is that the thicker a piece of cookware, the more warp-resistant it is, which would make a good segue into his next point.) Uh, to do this you must have a cooking utensil that is going to be fairly thick, and by thick I mean generally about an eighth of an inch.

Interviewer: So if it’s something that’s real thin (sic), you can be pretty sure it’s not going cook so well.

John Ulam (All-Clad): That’s right.

Interviewer: Does the pan also have to have aluminum in it somewhere to be able to properly conduct heat?

John Ulam (All-Clad): Not necessarily, but there are only two metals which actually have extremely high heat transfer, and they are aluminum and copper. So anything else really defeats the purpose. Silver of course does have maybe three percent higher than copper (sic), but, uh–

Interviewer: –little expensive lately, isn’t it?

So here we have John Ulam, founder of All-Clad himself, stating that cookware should generally be about 1/8th of an inch thick or more to last a lifetime, i.e., not warp. 1/8th of an inch = 3.175 mm. All-Clad Copper Core is 1.83 mm thick at best (published specs; measurement of the skillet says it’s more like 1.75 mm thick), though it is mostly stainless and copper, which resist warping better than aluminum, so maybe we’ll give Copper Core a pass. All-Clad MC2 is over 3.175 mm so it gets a pass, too. But All-Clad Stainless and D5 are just under 2.6 mm thickness, and as All-Clad Stainless goes, so goes every other copycat company, so now we have a legion of 2.6 mm thick clad cookware. Let’s hope that Ulam was referring to aluminum with a single layer of stainless bonded to it, and that stainless-aluminum-stainless cookware is more warp-resistant since it has an additional layer of stainless steel to reinforce its shape.

Everything in this article is to the best of my knowledge, but since I’m not the CEO of All-Clad, it’s ultimately speculation and should be read as such.[1][2] This section grew so lengthy that I moved it from its original location in this post.