The history of many large enterprises encompasses expansion from the original line of business into a variety of other economic pursuits, some more profitable than others. Hudson’s Bay Company’s history is no different. 

Diversification, as it is called, is usually a deliberate strategy to take advantage of opportunities which the original business presents as being potentially profitable with a minimal outlay of investment.  In some cases the new enterprise may have little if anything to do with the original business.  In the 19th century HBC embarked on a number of diverse businesses: most, if not all, grew directly out its major activity in the fur trade.

Sir George Simpson by Stephen Pearce, 1857, HBC Corporate Collection


Sir George Simpson: Champion of Diversification

Sir George Simpson, who led the Company’s North American activities from 1821-1860, was the first to develop new economic sidelines. Despite the objections of some, who viewed any business other than that of the fur trade as beyond HBC’s mandate and primary interest, Simpson willingly embraced any new venture, particularly if it had the added benefits of strengthening the Company’s monopoly and damaging or eliminating the competition.  During his tenure HBC got involved in two such businesses: lumbering in the Ottawa Valley, and fishing in the Great Lakes.  Viewing these activities as a type of encroachment on its lands as well as the fur trade – and certainly a case for the latter could be made for lumbering at least – HBC operated both at a loss, successfully eliminating the competition and maintaining control.


Pacific Commodities

Packing salmon, Labrador, ca. 1900, HBCA 1987/363-F-4A/1

HBC advertisement for Hubay and Labdor salmon, HBCA A.95/85 fo. 132

On the Pacific coast HBC became heavily involved in the production and sale of two commodities: salmon and cranberries.  Fort Langley was the centre of the salmon industry which arose in the early 1830s and took advantage of the huge, local Fraser River runs.  Salmon was so plentiful, particularly as compared with traditional fur-bearing animals such as beaver, that a second standard of trade, based on numbers of salmon, developed.  Fish were put up in salt in large barrels and shipped as far away as London, Honolulu and Australia. This experience came in handy in the early 20th century when HBC developed an Atlantic salmon canning business based in Newfoundland.  In 1920 the Company began producing canned salmon under the names Hubay and Labdor and in 1927 these were exhibited to great acclaim at the Annual General Meeting in London.  This business was expanded when in 1928 HBC acquired a majority interest in Job Bros. & Co. of St John’s, a fishing and packing industry, which it held until 1943. 

Cranberries, both bog and mountain varieties, were native to the Fort Langley area, and during the mid-1850s they became an important trade commodity. Cranberries travelled well and their high vitamin C concentration provided much-needed protection against scurvy.  In 1855, 725 barrels were sold.  Today, commercial cranberry bogs are still found around Fort Langley and Parks Canada’s National Historic Site, and each year in October the Village of Fort Langley BIA hosts a Cranberry Festival. 

Plan of Langley Farm by William H Newton, 1867, HBCA A.11/82 fo. 186B

From Agriculture to Ice

The company’s own farms in the Pacific Northwest – based at Cowlitz Farm as well as Fort Nisqually and, later Victoria – led to contracts to provision the Russians in Alaska, as well as the eventual sale of surplus foodstuffs and livestock on the open market.  These agricultural endeavours were handled through the Company’s subsidiary, the Puget Sound Agricultural Company.  In the early 1850s, following the California Gold Rush, HBC got into the ice business, leasing rights to cut ice from glaciers in northern British Columbia to supply the boom town of Yerba Buena – modern San Francisco – a business that at one time engaged six large ships. 

Coupled with his policy of rationalizing administration and attendant operating costs, Simpson’s diversification was on the whole successful, resulting in a period of increasing dividends and prosperity.


Land Sales

HBC advertisement for farm land, 1930, HBC Corporate Collection

In return for surrendering its rights over Rupert’s Land, HBC negotiated terms with the new government of Canada.  The resulting Deed of Surrender, signed in 1869, gave HBC £300,000 and land concessions throughout the “fertile belt” of the west – an area defined as lying between the 49th parallel, the Rockies, the North Saskatchewan River and the Lake Winnipeg/Lake of the Woods axis.  The Company established its Land Division in 1874 and appointed Donald Smith its first Land Commissioner.  Smith foresaw that land sales would be a highly profitable business.  The coming of the railroad and the settlers who followed it, meant that the days of profitable fur-trading in this region were numbered.  But as owner of some of the best agricultural land on the continent, HBC was poised to capitalize on the sale of homesteads to the new arrivals.  By the 1880s Winnipeg was in the midst of a huge land boom and for the next 40 years or so – until the late 1920s – land sales continued to generate huge profits for HBC.  But the asset was doomed to be a dwindling one and by the late 1940s the best had been sold and the Land Division was closed in 1961.  

Sir Donald A. Smith, by Adolphus Muller-Ury, 1903, HBC Corporate Collection