Caleb Davis Bradham and The Origin of Pepsi-Cola

Caleb Davis Bradham, an enterprising visionary born in Chinquapin, North Carolina, on May 27, 1867, embarked on a transformative journey that reshaped the beverage industry. Despite initially harboring aspirations of a medical career, Bradham's trajectory veered when his family encountered financial hardship, prompting his departure from medical school and return to North Carolina. With a sharp entrepreneurial instinct, Bradham delved into business, founding the renowned Bradham Drug Company in downtown New Bern.

Recognizing the vital role of community engagement, Bradham ingeniously converted his drugstore into a social hub by introducing a soda fountain. Here, he introduced his groundbreaking creation – "Brad's Drink" – a concoction comprised of sugar, caramel, lemon oil, nutmeg, and other natural elements. This innovative soft drink captivated patrons, swiftly gaining popularity as a sensation.

In a pivotal turn of events in 1898, Bradham rebranded his concoction as "Pepsi-Cola," a name destined for enduring resonance. Exhibiting keen business acumen, he secured the trademark for Pepsi-Cola in 1903, cementing its position in the burgeoning beverage market. Bradham's strategic vision extended beyond soda fountains, envisioning widespread accessibility for Pepsi. Consequently, he transitioned to bottling Pepsi-Cola, catalyzing exponential growth.

By relocating the bottling operations to a rented warehouse in 1903, Bradham laid the groundwork for Pepsi's remarkable ascent. Sales soared, with Pepsi-Cola swiftly gaining prominence in the market. The establishment of the Pepsi-Cola Company in late 1902 marked a significant milestone in Bradham's entrepreneurial odyssey, with him assuming the mantle of its inaugural president. Under his guidance, Pepsi-Cola thrived, captivating consumers nationwide.

Nevertheless, the aftermath of World War I introduced unforeseen hurdles, as surging sugar prices imperiled the company's stability. Bradham's decision to stockpile sugar at inflated rates precipitated Pepsi-Cola's bankruptcy in 1923, tarnishing his legacy. Yet, the narrative of Pepsi-Cola persisted.

In a twist of fate, Charles G. Guth, president of the Loft Candy Company, discerned the untapped potential of Pepsi-Cola and acquired the struggling brand in 1931. Under Guth's visionary leadership and strategic recalibration, Pepsi-Cola underwent a revitalization, heralding its triumphant resurgence in the beverage sector.

Caleb Bradham's enduring impact on the soft drink landscape stands as a testament to his entrepreneurial prowess and inventive fervor. From modest origins in a North Carolina drugstore to global prominence, Bradham's legacy reverberates in every sip of Pepsi-Cola, an enduring emblem of innovation and resilience.
Caleb Davis Bradham and The Origin of Pepsi-Cola

Charles George Guth (June 3, 1877 – May 24, 1948) - American businessman

Severe fluctuations in sugar prices caused the Pepsi-Cola Company to lose money, and in 1923 Bradham sold the trademark to Craven’s Holding Corp., who shortly after sold it to a New York stockbroker named Roy C. Megargel.

In 1931, the Pepsi-Cola Company was purchased by Charles G. Guth in a complex financial transaction worked out in association with, and at the instigation of, Roy Megargel. Guth was born in the mid-1870s and apparently had spent most of his life prior to the Depression as a fairly successful entrepreneur in the soft drink and confectionary industries. He joined Loft, Inc., a chain of confectionary stores, in 1929;and the following year he became president.

Although Pepsi was primarily a fountain product when Guth bought it, soon thereafter he began bottling operations, both company-owned and franchised. He established a new Pepsi-Cola Company, had a chemist formulate a better drink, set up new bottling operations, and began merchandising a hugely successful 12-ounce bottle for five cents.

Guth had many challenges to overcome in order to save the struggling brand. Through the Great Depression, Pepsi carefully positioned itself as a low cost leader and made advertising history when it released the nation’s first jingle “nickel, nickel,” which was heard across the nation.

Under Guth’s leadership, Pepsi grew to be a national brand once again. The Pepsi-Cola Company started to expand into international markets like the Soviet Union, Latin America, and Canada. After the end of World War II, Pepsi-Cola Company’s international headquarters were moved to Manhattan and it continued to expand further into international markets.

In 1936, Pepsi posted net after-tax profits of nearly $2.1 million. In 1937, profits reached $3.2million, and the company had a network of 313 domestic franchised bottlers, five company-owned bottling plants, and the beginnings of a foreign business.

Guth was also president of Loft, Incorporated, a candy manufacturer and soda-fountain chain (founded 1919), and in legal battles in 1936–39 he lost a controlling interest in the Pepsi-Cola Company to the new management of Loft. When in 1941 the Pepsi-Cola Company was merged into Loft, the name Loft, Inc., was changed to Pepsi-Cola Company.

Charles George Guth (June 3, 1877 – May 24, 1948) - American businessman

Caleb Davis Bradham - founder of Pepsi-Cola

Caleb Davis Bradham (27 May 1867–19 Feb. 1934), founder of Pepsi-Cola and pharmacist, was born at Chinquapin, Duplin County, the son of George Washington and Julia McCann Bradham.

He attended several North Carolina academies before entering The University of North Carolina in 1886. After three years he left to study medicine at the University of Maryland.

Unfortunately, a family crisis forced Bradham to drop his pursuit in medicine and return home to North Carolina. He returned home to teach in the Vance Academy in New Bern, a private school run by Appleton and Augusta Oaksmith.

Bradham continued to be interested in medicine, and after two years he went back to Maryland and entered the College of Pharmacy. Upon completion of those studies, he purchased a drug store in 1891 in his hometown of New Bern, North Carolina, and established "Bradham's Pharmacy," where the Pepsi-Cola story began.

Caleb Bradham experimenting with combinations of spices, juices, syrups and he trying to create a refreshing new drink to serve his customers. He invented the beverage known around the world as Pepsi-Cola.

In 1893, he sold it as “Brad’s Drink”, claiming among other things that it was a “cure for dyspepsia.” The “Brad’s Drink,” made from a mix of sugar, water, caramel, lemon oil, nutmeg, and other natural additives, became an overnight sensation.

In 1898, Mr. Bradham purchased the name “Pep Cola” from a company that had gone out of business, subsequently changing the name of his creation to Pepsi-cola and seeking a patent on the name in 1902.

In late 1902, the Pepsi-Cola Company was formed due to the rising popularity and demand for the Pepsi-Cola Syrup with none other than Caleb Bradham as the first president. The company became a corporation under the laws of North Carolina. It began in the back room of the drug store and was an immediate local success.

He mixed his syrup, packaged it, and went out to build sales. He was a popular man and a superb salesman, and it was not long before his drink became a nationally known product. He franchised other territories in rapid succession until, by the end of 1910, there were at least three hundred bottlers spread over twenty-four states.

Hard times fell on Bradham and the Pepsi-Cola franchise during WWI. This was due to the high price and severe rationing of sugar. Pepsi Cola officially was bankrupt as of May 31, 1923, and its assets were sold to Craven Holding Corporation for $30,000.

Caleb Davis Bradham - founder of Pepsi-Cola