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The Hudson’s Bay Company

July 2024
28min read

A TRICENTENNIAL REPORT Having worked like a beaver to overcome three centuries of plunging thermometers, recalcitrant Indians, and fierce competitors from Quebec and the U.S.A., it remains today the continent’s most durable trading enterprise



1 leaky ketch

1 abandoned canoe

2 or 3 pairs of used snowshoes

1 naturally air-conditioned log hut

1 small load of beaver pelts, partially exchanged for baubles, bangles, and brandy

14 employees

38.8% of Canada


2 large ships 4 barges 3 tugs 3 airplanes 575 trucks God knows how many snowmobiles 8 large air-conditioned department stores 25 medium-sized department stores 217 smaller stores 3 of the world’s largest fur auctions 65 million dollars’ worth of merchandise on hand, including an ample supply of Hudson’s Bay Scotch Whisky 15,000 employees, give or take a few .0017% of Canada

During the centuries-long expansion of the Hudson’s Bay Company throughout Canada, its initials, emblazoned on the flags it flew, became ubiquitous. There were even jokes about the symbols. HBC—What did that stand for? asked the tenderfoot. And the old trapper took another pull at his clay pipe before replying gravely, “Here Before Christ.”

More literally, the firm—its official name was “The Governor and Company of Adventurers of England Trading into Hudson’s Bay”—was granted its charter by Charles II of England three hundred years ago, on May 2, 1670. Straightway it was beset by such troubles that during its first forty-eight years it paid only four dividends to its stockholders. Although profits became steadier thereafter, it remained subject to violent attacks from opponents in the field and to scathing denunciations in Parliament. Yet always it triumphed, rich, venerable, and prestigious—the Honourable Company, as its friends sometimes described it, in simple majesty.

Doggedness rather than zest was the key. The company’s traders were still groping for the techniques that would let them survive in the windswept muskeg beside their frozen bay when they were challenged by French winterers from the St. Lawrence—audacious men thoroughly familiar with the cascading waterways that furnished the only trade routes through the armadillo shell of granite that covers most of eastern Canada. Unable to outmaneuver this formidable enemy, the English sat tight until at last war and international diplomacy eliminated France entirely from the New World.

There was no surcease beside the bay, however. The famed North West Company, a belligerent union of Highland Scotsmen and American colonists, stepped into the shoes of the French and resumed a trade war that soon spread across the Rockies to the Pacific. But the Honourable Company outlasted their furious energy, too, and took over the entire northland. With two centuries of such experience fortifying them, the new overlords of the wilderness had little trouble turning back a brief challenge from American trappers in the Pacific Northwest. Settlers, however, were something else. They could outstay even the Honourable Company. With unfailing resilience the traders turned to serving the newcomers rather than fighting them. So the flag with its ubiquitous initials stayed aloft, as familiar now as breathing to thousands of people who never heard of the old, dashing enemies from Montreal.

Curiously enough, the inevitabilities of geography that let the English acquire their first stubborn foothold in Canada were first appreciated by two outlawed French traders. And they reached their conclusions without even laying eyes on the vast bay that was the key to the situation.

The elder and leader of the pair was Médart Chouart, Sieur des Groseilliers. The other, his brother-in-law, was Pierre Esprit Radisson.

Groseilliers came to Canada from France as a youth about 1640, when prospects in the little settlements along the St. Lawrence River were bleak. The fur trade, the only business of consequence in the colony, was dominated by a legally created monopoly that held its favored position by financing the government. All independent trading in furs was forbidden.

In an effort to make the interdiction effective, the monopolists sought to confine the trade to a handful of rendezvous points scattered along the St. Lawrence River. Each year hundreds of Indians came to these sites in fleets of fur-laden canoes. They picked up cloth, iron tools, “guns, and ammunition from the legally licensed traders and carried the articles back into the wilderness. There they traded the goods to more distant tribes. Since the role of middleman was profitable, rivalries developed among the Indians. By seizing control of the rugged transportation routes that led from the French settlements to the upper Great Lakes, the Huron tribes became dominant.

Meanwhile Dutch and English traders were pressing northward along the Hudson River. They, too, worked through Indian middlemen—the confederated tribes that made up the Iroquois nation. When the Iroquois sought to handle pelts that otherwise would have been traded by the Huron, explosive wars broke out.

The whites joined the rivalry. They armed their Indians and provided them with early-day technical advisers—bold young men who lived with the tribes, cajoled them into resisting the blandishments of the other side, and helped them in their battles. Associated with the emissaries from the St. Lawrence were Jesuit priests, who joined the trading groups in order to live with the heathens they hoped to convert.

In 1646 young Médart Chouart (he had not yet become Sieurdes Groseilliers) travelled with a group of Jesuits to Huronia, on the shores of Georgian Bay, the northeastern bulge of rock-bound Lake Huron. He learned firsthand the staggering difficulties of toiling in a canoe up the Ottawa and Mattawa rivers, of portaging around the rapids while black flies and mosquitoes devoured him, and of slogging through fetid marshes in order to cross the low divide near Lake Nipissing. He learned, too, that the Huron were starting their long slide into defeat. In 1648 and again in 1649 Iroquois raiders swept through the Huronia villages, killing and ravaging. The shattered Huron fled west to new homes around Lake Michigan and south of Lake Superior.

The dispersal left the French settlements in desperate straits. The trade on which they depended had ceased to exist. In 1652 not one beaver pelt reached the warehouses at Montreal.

The next year hope revived. Via roundabout northern routes three canoes slipped into the village of Trois Riviâres, below Montreal, with reports that a new Indian trading fair was being organized far to the west. Simultaneously an Iroquois delegation approached Quebec with an offer of peace.

Groseilliers undertook to find the new Huron villages and persuade the Indians that it was again safe to bring furs to the St. Lawrence. With a companion he spent the winter of 1654–55 at Green Bay, a western arm of Lake Michigan. The next summer, while prowling through what is now northern Wisconsin to spread the good news, the two men picked up reports of an enormous wealth of unexploited beaver around Lake Superior. The following year they led a flotilla of richly laden canoes back over the long waterways from Lake Superior to the St. Lawrence.

Montreal rejoiced. Rewarded with a part of the furs, Groseilliers settled with his wife on a seigniory near Trois Riviâres. There he took to swapping tales with Madame Groseilliers’ half brother, Pierre Radisson.

Radisson’s career had been equally strenuous. In 1651, aged fifteen, he had been captured by Mohawk and adopted by one of their families. For attempting to escape, he was bound in such a way that he could contemplate his own coming punishment by watching the torture of fellow captives. He witnessed the slow disembowelment of a pregnant Frenchwoman and the pouring of molten lead into the wounds of other victims. As for himself, he wrote later, a Mohawk warrior ” run through my foot a swoord red out of the fire and plucked several of my nails.” But, he added, his foster parents intervened to keep things from growing really rough.

As soon as he could walk, he made another break, reached the Dutch in upper New York, and returned to Canada by way of France. Shortly thereafter he joined a mission that the Jesuits were preparing to send among the Onondaga in response to the Iroquois peace feeler of 1653. He traded on the side, and when he returned to Trois Riviâres in 1657, still only twenty-one, he was a seasoned veteran.

Fired by their own talk, Groseilliers and Radisson decided to tap the fur supply of the Lake Superior region. When they applied to Governor d’Argenson for licenses, he imposed conditions that would have made him a secret, nonworking partner in the venture. Unwilling to pay so high a price, the brothers-in-law impulsively decamped overnight with a group of westbound Indians, confident that if they achieved a success like Groseilliers’ in 1656 their illegality would be forgiven.

They survived a starving winter at Chequamegon Bay, on the southwestern shore of Lake Superior. When the ice broke in the spring of 1660, they chanced to meet a party of wild, shy Crée Indians from the north. These Crée had with them, for trade to Huron or Ottawa middlemen, the glossiest beaver pelts that the French traders had ever seen. Eagerly the two entrepreneurs inquired about the source of the furs. As an incident to the answers, they heard of massive rivers that rose beyond a nearby divide of ice-scoured granite (the high part of the Canadian Shield) and ran northward to an inland sea of salt water. The journey to that sea, the Cree went on, was neither long nor laborious.

The implications were startling, for the foaming waterways that the Frenchmen had followed through the Shield from Montreal were both long and extraordinarily difficult. Now it seemed that there might be an easier way.

One can imagine them scratching lines into the earth with twigs so as to bring into focus such geography as they knew. Though ill-informed about early sea explorations to the north, they somehow guessed, wildly but accurately, that the Crée salt water was Hudson Bay. Speculation leaped. Would the government finance them on a scouting trip to learn whether it was possible for a ship to creep into the bay at the beginning of each brief summer, lure the Indians to a trading rendezvous at the mouth of one of the rivers, and then leave with the furs before the ice closed in? If developments were favorable, would they be granted a monopoly?

True, they were currently operating outside the law. In view of the circumstances, however, their small dereliction about licenses surely would be overlooked.

Hopefully they returned to tradestarved Montreal at the head of a fleet of Indian canoes “that did almost cover ye whole river.” But the axe fell anyway. After imposing the normal 25 per cent tax on the portion of furs that Groseilliers and Radisson considered their own, Governor d’Argenson added fines that were all but confiscatory, and pocketed the bulk of the proceeds for himself. He also declined to hear talk of a route through Hudson Bay. Why should he listen? Opening a rival path to the interior would dilute the monopoly of the St. Lawrence.

Outraged, Groseilliers hurried to Paris to protest the fines and to ask for help in reaching Hudson Bay. He was brushed aside. But the thought of those wonderful furs kept the brothers-in-law from admitting defeat. Twice they hired ships in the hope of reaching the bay on their own, and twice they failed. Persisting still, they went to England. There, after long delays occasioned by outbreaks of plague, war, and London’s great fire, they gained audiences both with King Charles II and with the King’s cousin Prince Rupert. After more delays the prince eventually assembled half a dozen or so men who were willing to underwrite the explorations the Frenchmen proposed.

Two diminutive ships were loaded with trade goods—the Eaglet , forty feet long, of fifty-four tons burden, and the Nonsuch , a ketch thirty-seven feet long and of forty tons burden. Although Radisson and Groseilliers supervised most of the preparatory details, they were not allowed to take charge of the expedition. They were Frenchmen. In case of war between France and England, there might be problems of loyalty. Furthermore, if the adventure did result in notable discoveries, there would be protection for England in having it done under the aegis of a British citizen. Command, therefore, was given to Zachariah Gillam of Boston, Massachusetts, an experienced seaman who was also captain of the Nonsuch . Radisson and Groseilliers—whom the English insisted on calling Mr. Gooseberry—would go along as consultants.

The two ships sailed from Gravesend, on the Thames, on June 3, 1668. In mid-Atlantic a storm engulfed them. The Eaglet , with Radisson aboard, was damaged so severely that she had to turn back. The Nonsuch , on which Groseilliers had sailed, continued through Hudson Strait and turned along the flat eastern shore to the nipple at the southern end, James Bay.

Gillam beached the Nonsuch inside the mouth of a river that he named the Rupert. Close beside the ship the crew built Fort Charles, a hut of logs erected picket style. Though they lived well enough on wild fowl and fish, they were appalled by the six months of almost unimaginable cold.

News of their presence spread from Indian to Indian. Hundreds appeared at the spring thaw to exchange beaver pelts for the inestimable boon of tools, metal cooking utensils, cloth, and bright, cheap jewelry. Obviously trade could succeed in the bay. Delighted with the prospects they had opened, the adventurers hurried back to London, arriving October 9, 1669.

The lush furs caused a sensation. During the ensuing winter Prince Rupert easily persuaded eighteen men (he and the original backers included) to invest an average of three hundred pounds each toward forming a company for developing the trade. On May 2, 1670, King Charles granted this group a royal charter authorizing it to carry on commerce in “Furrs, Mineralls and other considerable commodityes.” On parchment, at least, H.B.C. had come into existence.

The charter also granted the company title to the entire watershed of Hudson Bay. In time surveyors would calculate the area at 1,486,000 square miles, or ten times the extent of England, Wales, Scotland, and Ireland combined. The document then went on to describe the legal mechanics whereby colonies, or “plantations,” complete with administrative officials and law courts, could be established in the area.

All this was a gambit in international chess-playing. In 1670 not Charles II, Groseilliers, Gillam, or anyone else could have had the least notion about the extent of the territory involved. Amounts did not matter. The real purpose was to counter in advance any conflicting claims that France might try to assert on the plea that her citizens had settled Canada first. By declaring an intention to plant a colony where no Frenchman (except Groseilliers) had yet set foot, the English might be able to contain their rivals within the granite-cramped bounds of the St. Lawrence.

Management of the new company was placed in the hands of a governor (Prince Rupert was the first) and a committee of seven. Although they were called “Adventurers Trading into Hudson’s Bay,” none of the English shareholders had the least intention of risking either the icebergs or the Indians. Supervision of that work was entrusted to a resident director, also called governor. The first one was Charles Bayly, a dour Quaker who had played with King Charles as a lad but had later been clapped into the Tower of London for his all but seditious criticism of the lax ways of the court. Bayly evidently considered exile at Hudson Bay preferable to confinement in the Tower, and Charles obliged him by foisting him off onto the Honourable Company.

Aided primarily by Radisson and Groseilliers, Bayly soon established three posts on the southern perimeter of James Bay: Fort Charles, enlarged with brick and mortar; Moose Factory at the mouth of Moose River; and north of Moose Factory, Fort Albany. Because each post offered better blankets, hardware, and guns than did the French traders from Montreal, Indians flocked to them. The Crée, who lived to the south, and the Assiniboin, who lived to the southwest, began jockeying for position as middlemen. Abruptly the French awoke to therealization that thousands of pelts that once would have worked their way through aboriginal trade routes to the St. Lawrence were now being diverted to the Bay.

The officials in Quebec were in a quandary. Choice northern beaver skins, as contrasted with poorer pelts from farther south, were still the lifeblood of the colony’s economy. The English traders had to be checked—but, unhappily, France and England were currently yoked together as uneasy allies against the Dutch. Fearing that an overt attack on the posts at the bay would bring thunder from Paris, the unhappy men at Quebec decided to tiptoe around the dilemma.

One move was to assemble representatives of fifteen Indian tribes at a great council beside the roaring cataracts—the Sault of St. Mary’s River, the link between Lake Huron and Lake Superior. There, on June 4, 1671, with the assent of the Indians, who hardly understood what was happening, a bewigged and bespangled representative of the King of France proclaimed French sovereignty over all the lands roundabout, as far as the western, northern, and southern seas. Mere words, of course—but to French minds as good as the words in the charter of the Hudson’s Bay Company.

In marked contrast to this pomp were two spying missions undertaken for Montreal by a remarkable Jesuit, Father Albanel, who travelled to the bay by foot and canoe with small parties of Indians. On his second trip, in 1674, Albanel struck Governor Bayly as being altogether too friendly with Groseilliers, who was wintering there. In the spring Bayly sent the pair under suspicion to London, where the embarrassed committee quickly apologized. This was not enough for Radisson and Groseilliers, however. They felt underpaid at best. Their brains had been well picked, and as the need for their advice had declined, they had found themselves treated with increasing disdain. Aroused by this last indignity, they followed Albanel to France and there sought to interest the French court in backing a competitive invasion of the bay.

Paris declined to respond. Years passed before the brothers-in-law made contact with a wealthy merchant of Quebec, Charles Aubert de la Chesnaye, who, in spite of frowns from the governor, had been trying to set into motion exactly the sort of enterprise that Radisson and Groseilliers were proposing. He was delighted to obtain their know-how.

Loading two small ships with goods, the trio sailed in 1682 from Quebec to a low, marshy point of land between the Hayes and Nelson rivers, on the western shore of the great bay. To their astonishment two other parties appeared almost at once. The first was a group of Bostonians led by Benjamin Gillam, son of Zachariah Gillam of the Hudson’s Bay Company. Shortly thereafter along came Zachariah himself, in charge of the company ship Rupert . With Gillam was a new resident governor, John Bridgar, big with plans for building a factory at the point.

There were many Indians about, and during the winter the rival groups did not dare weaken themselves with quarrels. As it was, there were casualties enough. Winds swept the Rupert out to sea, where she was crushed by ice. In the disaster Zachariah Gillam and several hands perished.

At the first sign of spring, while the others were off guard, Chesnaye, Radisson, and Groseilliers pounced. They made prisoners of everyone. After constructing one sound ship of their two winter-battered craft, they loaded aboard it all the men of the Hudson’s Bay Company except Governor Bridgar and sent them to the posts at James Bay. Smugly the Frenchmen then appropriated the New England ship, the Batchellor’s Delight , and both parties’ furs for themselves. Leaving Groseilliers’ son in charge of Port Nelson, as they called their post, they sailed to Quebec, taking the New Englanders and Governor Bridgar along as prisoners.

The governor in Quebec promptly released the captives and restored their ship to them. In spite of the conciliatory gesture, the Hudson’s Bay Company charged piracy, asked heavy damages, and sought to use the incident as a means of obtaining French recognition of their claims to the entire watershed of Hudson Bay. Although the French government refused the demands, it did disavow the action of the traders and ordered them to apologize.

At some point during the dispute Groseilliers died. On his own now, disgusted by what he considered French abjectness, and influenced by his wife, who was the daughter of one of the Honourable Company’s original shareholders, Radisson returned to English service. Sailing to the Nelson River in 1684, he captured from the French the fort he had built there and persuaded young Groseilliers also to switch allegiance to the Hudson’s Bay Company. It was Radisson’s last notable service for the firm he had helped originate.

That same year the company declared its first dividend, a thumping one of 50 percent. Not all was well, however. The French were growing aggressive. Stung by Radisson’s defection, mariners of the Quebec firm that once had employed him seized a Hudson’s Bay Company ship in 1685 and carried it as a prize to the St. Lawrence. There a new governor greeted the raiders not with reprimands but with congratulations. The next year the same governor sent thirty soldiers and seventy voyageurs overland to James Bay. Surprise was total—and, anyway, the English cannon pointed toward the sea. The French captured the three southern posts. Only Port Nelson remained in English hands.

A first the losses caused surprisingly little hurt. The Nelson River, more than the streams of James Bay, tapped the heartland of the north, and Indians flocked down it with their furs. In 1690, flushed with euphoria, the London directors voted a three-for-one stock split and then declared a 25 per cent dividend on the augmented total.

The move was premature. At the bay trade had already slacked off. The persistent French had at last pushed through the granitic Shield into the heartland and were diverting part of its furs to the St. Lawrence.

The breakthrough was a triumph in environmental adaptation. Even as recently as the days of Groseilliers the colonial fur monopoly had continued to urge the Indians to sell their furs at controlled rendezvous sites along the St. Lawrence. As the white population grew, however, increasing numbers of unlicensed coureurs de bois took to breaking the pattern. They smuggled goods to distant Indian villages, picked up the furs on the spot, and smuggled the pelts back to illegitimate market places.

In an effort to meet this shadowy competition, the monopoly began sending its own traders among the Indians. A race began. Building on years of experience, the aggressive French learned how to take their birch-bark canoes westward to the region north of Lake Superior, near Lake Nipigon. They managed to arrive just as the Indians of the area were starting their trips to Port Nelson, soon rechristened York Factory. But why make the journey when the French were at hand? The Indians bartered as many of their finest pelts to the newcomers as the traders could handle in their canoes, and then let the surplus, mostly coarser, cheaper furs, go down the rivers to York.

The English reaction was stodgy but firm. The traders at Hudson Bay lacked the long experience with Indians that their rivals possessed. They were afraid of the vast, silent lands of the interior. Moreover, they could not find on those barren coasts the birch bark and cedar necessary for building canoes. In the face of these difficulties it would be better, the directors decided, not to compete in the interior but to step up efforts to bring more Indians to York Factory. After all, the English, too, had advantages. The quantity of merchandise that the French could carry over the long canoe routes from Montreal was limited. York Factory, by contrast, was stocked by ocean ship with an abundance of superior cloth, ironware, and tasty Brazilian tobacco. If a qualified emissary were sent among the Indians to urge these truths, the flow of trade would surely resume.

The messenger chosen for the promotional trip was Henry Kelsey, aged twenty. Kelsey had come to Port Nelson about the same time as Radisson, in 1684. He had accepted the new world with a boy’s wide-eyed delight. Unlike most of his fellows, he preferred the nomadic camps of the Indians to the boredom of the more comfortable trading posts. Carefree journeys along the bleak shores of the bay soon brought him a reputation as a traveller, and when the matter of a selling trip among the Crée and Assiniboin arose, he actually wanted to go.

He wandered joyously for two years. He kept a record of sorts, partly in doggerel. (“In sixteen hundred and ninetyth year / I set forth as plainly may appear …”) It is not possible to tell from his meager descriptions exactly where he did go, but he certainly reached the Saskatchewan River, followed it westward a distance, and then turned south into the Great Plains, country that the French had not yet touched.

In 1692 he brought back to York Factory “a good fleet of Indians” and the first written description of the Canadian interior. Nothing came of it. During his absence France and England had declared war. Trade stagnated. Now and then warships of one nation or the other slid into the bay—the different posts changed hands repeatedly—and in 1697, during a climactic naval battle, Pierre Lemoyne, Sieur d’Iberville, sank a fiftytwo-gun English man-of-war and captured one of the supply ships she was escorting. The price of Hudson’s Bay Company stock crumbled from £260 to £80. For twenty-seven years, from 1691 through 1717, there were no dividends.

In Europe, English arms were more successful. The Treaty of Utrecht (1713) recognized the fact by confirming English sovereignty over the Hudson Bay drainage system and returning to the company the posts held by the French. The long work of rebuilding then began.

One new post, massive Fort Prince of Wales, was erected at the mouth of the Churchill River, far north of York Factory. The purpose was as conservative as ever—to lure in Indians, this time the Chipewyan, who lived around the icy shores of Great Slave Lake. Why do more? A postwar depression had slowed the French, and trade was dropping by default into English hands. Costs of less than twenty thousand pounds a year produced annual profits ranging from four thousand to ten thousand pounds, to be distributed among fewer than a hundred stockholders.

It was a false security. The French, too, recouped. From Montreal, North America’s greatest family of adventurers, Pierre Gaultier de Varennes, Sieur de La Vérendrye, his three sons, and a nephew, launched a new drive into the heartland. First they created a staging depot at Grand Portage on the western shore of Lake Superior, so that goods could be stored there during the winter and then rushed ahead as soon as the ice went out of the rivers. Because food was always a major problem for the hurrying boatmen, the Vérendryes built supporting posts at Rainy Lake and Lake of the Woods, where their men raised crops and bought wild rice from the Indians. They improved the arduous portage trails and used missionaries to help bring peace to the warring tribes. Their wilderness diplomacy sometimes backfired. Hoping to woo the Crée away from York Factory, La Vérendrye let one of his boys march with a Crée war party against the Sioux. In vengeance the Sioux later massacred twenty-one Frenchmen, including La Vérendrye’s eldest son. The French wanted beaver? Very well, here was some—and the Indians wrapped the decapitated heads of the slain men in beaver pelts for La Vérendrye to find.

In spite of such shocks La Vérendrye kept pushing west. By the middle of the 1740’s the family combine had posts south and west of Lake Winnipeg. Unlicensed coureurs de bois kept pace with them, and soon the number of choice pelts reaching York Factory dropped by one third.

Attacks at home were added to those in the field. Arthur Dobbs, SurveyorGeneral of Ireland and the company’s most dedicated critic, urged the abrogation of its charter because of neglect of duty. He pointed out that the company was not searching for the Northwest Passage from Hudson Bay to the Pacific. It had allowed the French to establish themselves in its own territories, thus sacrificing trade that would have stimulated employment in English factories. And on and on, until Parliament, squirming under the goad, first offered a reward of twenty thousand pounds to whoever found the passage—Dobbs promptly tried with two ships, but failed—and next, in 1749, ordered a full-scale investigation of the company’s activities.

In answer to the hostile inquiries, the company cited the trips its men had made—Kelsey’s to the plains, and sporadic ventures along the bay’s north coast, during one of which the resident governor James Knight and the crews of two small sloops had died horribly in the ice. In 1743, furthermore, Joseph Isbister of Fort Albany had countered French activity north of Lake Superior by building Henley House at the forks of the Albany River. Henley was a meager place, only about one hundred and forty miles from salt water, but historic nevertheless, for it was the company’s first inland post.

The charter survived. Unfortunately, victory in Parliament restored complacency in North America. When Anthony Henday was sent to the foot of the Rockies in 1754, it was in furtherance of the old bankrupt policy: find new Indians and bring them to the bay. He failed. The horse-riding Blackfeet whom he met told him that they did not understand canoes and, furthermore, that they hated fish, which they would have to eat if they left the plains. They would rather stay in their own country, feast on buffalo meat, and buy such goods as they needed from the Cree and Assiniboin, middlemen who traded with the French to the east.

Convinced that the cultural patterns of the Plains Indians could not be changed, Henday urged his employers to change theirs. They declined to take him seriously. He was not a reliable observer, they decided. He said that he had seen Indians on horseback, though everyone knew there were no horses in the western wilderness. Besides, the French were finished. A new war had erupted. In 1759 Quebec fell to Wolfe; and in 1763 the Peace of Paris removed France entirely from North America. At last the field was clear—or so it seemed.

Disabusement came swiftly. Into the vacuum left by the French rushed a new horde of exploiters—Scotsmen, English, and men from the American colonies. At first the chaos of the invasion hid the extent of its threat. The newcomers struggled ferociously with one another for supremacy. They lived hand-to-mouth on shaky credit, debauched the Indians with drink, raided one another’s posts, and occasionally killed one another.

The London committee of the Hudson’s Bay Company sniffed at the rabble as “Pedlars,” but their traders in the field were alarmed. The Pedlars might be at each other’s throats, but among them they were getting even more furs than the French had. The time had arrived when the company must exploit its shorter trade routes from the bay and move into the interior ahead of the enemy.

London finally agreed. New outposts were scattered from Henley House southward toward Lake Superior. More vitally, in 1774 Cumberland House was built well up the Saskatchewan by Samuel Hearne, a young explorer who had recently achieved renown for his harrowing overland trip to the mouth of the Coppermine River on the Arctic Ocean. Now let the Pedlars come!

They did, in dismaying force. A league of Montreal merchants strong enough to command ample credit in London linked themselves to the traders, who were called “wintering partners.” Ruthlessly this group stamped out internal competition and emerged as the famed North West Company of Canada. Aggressiveness was fostered by giving key field men shares in the firm, a profit incentive that the traders of the Hudson’s Bay Company lacked.

Nowhere did the zest produce more spectacular results than in the new company’s transportation system. Canoes forty feet long, aided later by tiny sailing ships, carried cargo to the distribution center of Grand Portage on the west side of Lake Superior. (After Grand Portage was found to be in American territory, the center was shifted forty miles northward to Fort William on the Kamanistiquia River.) There the bales of merchandise were reloaded onto smaller canoes for transport over hundreds of miles of white water to posts as far away as Athabasca and, somewhat later, New Caledonia, beyond the Rockies.∗∗ The Athabasca country lay in what is now northern Alberta Province and stretched west to the Rockies. New Caledonia became British Columbia.

One essential to the system was the skill and staying power of the singing French-Canadian voyageurs from the St. Lawrence. Another was concentrated food for sustaining the paddlers on their heroic journeys. West of Rainy Lake they relied chiefly on pemmican made of dried buffalo meat pounded into a powder and mixed with melted fat. The center for the preparation of pemmican was the prairie land south and southwest of Lake Winnipeg, along the Red River and its tributaries.

By keeping this far-flung network operating smoothly, the Nor’Westers grew into a giant combine that each year exported six or seven times as many furs as the Hudson’s Bay Company. And yet the headlong expansion bred its own problems, including a host of young clerks clamoring for a share of the profits, a demand that could be met only by further growth. At that point the fragile canoes showed their limitations. Additional posts in the Canadian west could not be serviced from Montreal.

A search for a usable river outlet to the Pacific began. After a false cast to the Arctic in 1789, Alexander Mackenzie finally managed, in 1793, to traverse the formidable mountains of today’s British Columbia and reach salt water at Bella Coola Sound. Although a tremendous feat of exploration, it solved no problems; the canyons that Mackenzie travelled would never do for boat transport. And so a fight began to force the Hudson’s Bay Company to share the river ports of its jealously guarded inland sea.

At the outset of the struggle the English company appeared much weaker than its opponent. Though it had developed shallow-draft overgrown rowboats equipped with sails for quiet water—York boats, they were called—and had imported sturdy Orkneymen from Scotland for manning them, its traders generally reached the Indians half a jump behind the rampaging Nor’Westers. The bulk of the choicest lightweight furs still went to Montreal, leaving the company to barter for the heavier, coarser pelts—skins difficult to market during the dislocations of the Napoleonic wars.

There was one strength, however. The company’s stockholders did not have to live on their dividends, as the Nor’Westers did. They had waited out trouble before, and they did so now. Unable to stampede them by public attacks on their charter, Mackenzie next sought, with the financial backing of Thomas Douglas, Earl of Selkirk, to buy control of the company. That effort also failed, mainly because of a clash between Mackenzie and Selkirk over policies to be followed in the event of success.

After the collapse of the venture Selkirk found himself with considerable company stock on hand. Promptly he set about familiarizing himself with the business. One weakness struck him hard—that ancient charter. How could its validity be established against future attack?

He devised an extraordinary plan. He was already committed to setting up colonies in Canada where impoverished Highlanders from Scotland might begin their lives anew. The company charter allowed the formation of colonies on company land. Very well, then. He would obtain a tract from the company, and by planting a colony on it would help his Highlanders while affirming the charter. There would be other benefits. The colonists would grow food for the company’s posts and boat crews. They would furnish a pool of manpower on which the company would draw.

The area he selected lay south of Lake Winnipeg. The first colonists, travelling with great hardship through Hudson Bay, reached the site of their intended village near the junction of the Red and Assiniboine rivers (Winnipeg stands there today) in 1812. (See “The Boy Artist of Red River” in the February, 1970, AMERICAN HERITAGE .) It was a choice spot, but it lay in the heart of the Nor’Westers’ pemmican country. No matter what Selkirk said about his humanitarianism, to the North West Company the colony looked like a flagrant attempt to disrupt their provisioning routines and thus cripple their transportation system. They reacted explosively.

In 1815 a gang of métis, the half-breed buffalo hunters of the North West Company, burned the colony’s huts and trampled its crops. The terrified settlers fled toward York Factory. On the way they met flamboyant Colin Robertson, a onetime Nor’Wester who had deserted to the Hudson’s Bay Company. Defiantly Robertson brought the fugitives back to Red River. During the tense winter that followed, he imprisoned Duncan Cameron, the “wintering partner” in charge of the Nor’Westers’ nearby Fort Gibraltar. Later the governor of the Selkirk colony, Robert Semple, razed the structure itself.

As soon as spring made travel possible, the Nor’Westers began gathering to free Cameron. Before they reached the settlement, however, the métis struck again—the infamous “Massacre of Seven Oaks.” During the carnage Semple and twentyone settlers died.

Selkirk, who was on his way to Red River with a guard of mercenary soldiers, retaliated by seizing the Nor’Westers’ great staging depot, Fort William, on Lake Superior. Simultaneously the traders in the fur country plunged into mutually exhausting campaigns of harassment and disruption.

The British government at Quebec sent investigators into the field. Parliament resounded with charges and countercharges. In Quebec, as well as in Montreal, the battle seemed a draw, but in the wilderness the Nor’Westers broke.

The North West Company had overextended in order to build forts in New Caledonia and to buy, during the War of 1812, John Jacob Astor’s post of Astoria at the mouth of the Columbia River. It was impossible to digest that expansion while carrying on a wasteful feud. Disgusted by dwindling profits and by the unyielding belligerence of the firm’s Montreal agents, winterers John McLoughlin, a towering six feet four inches tall, and Angus Bethune led a revolt in search of peace.

The upshot, after intricate maneuvering, was a union of the two companies. Although the former winterers of the North West Company placed more of their men in responsible positions in the field than did the English company and won a profit-sharing arrangement for all principal workers, the name of the new continent-wide firm was familiar: the Hudson’s Bay Company. Management stayed in London; London appointed the resident governor. Aided by the inevitabilities of geography, the little David of the North had swallowed Goliath.

The new resident governor was pudgy George Simpson, a meticulously trained, disagreeably cocky one-time sugar broker’s clerk from London. Except for a hard winter in Athabasca during the final year of the conflict, he had had no experience in the fur trade. But he was aboil with energy, and he had a genius for organization.

He reassessed every post from Labrador to New Caledonia, let some stand, moved a few, closed several. He demanded that those in kindly climates grow enough vegetables and livestock to feed themselves. He instituted new transport systems, sending ships around Cape Horn to supply the Columbia district and using York boats out of Hudson Bay to service the posts in the interior. The colorful canoe brigades from Montreal were abandoned, a sore blow to the economy of Lower Canada but an inevitable move for a firm devoted to paring costs.

Expansion continued, more methodically now. Robert Campbell opened the Yukon. Sailing ships, and later a steamboat, plied the north Pacific coast, buying sea otter from the Indians. A trade in salmon and timber was developed with San Francisco and Hawaii. The Puget Sound Agricultural Company, managed by John McLoughlin, the benevolent chief factor of Fort Vancouver on the Columbia, was formed to provide Russian Alaska with meat, grain, and dairy products.

When American trappers sought to invade the Oregon country, they were easily held back by roving brigades under Peter Skene Ogden and, later, John Work. Settlers were something else. Spearheaded by missionaries to the Indians, they poured into Oregon during the early 1840’s, bought supplies on credit from McLoughlin, and then, seeking undivided American jurisdiction over the area (instead of joint sovereignty with Great Britain), raised loud clamors against the company’s autocratic ways. Beset by other crises in international affairs, the British government in 1846 yielded to President Polk and let the boundary between the countries be drawn at the forty-ninth parallel, save for the overlapping southern tip of Vancouver Island. There, at Fort Victoria, McLoughlin having resigned to become an American citizen, James Douglas established the company’s new western headquarters.

The filling up of Oregon was a harbinger. In 1858 discoveries of gold along the Fraser River brought a stampede of miners into British Columbia. Far to the east lumberjacks invaded the Canadian Shield and augmented their income by trapping in defiance of the company’s monopolistic rights. In the Midwest the métis of the Red River regularly left their little farms to smuggle furs to buyers in Minnesota.

The Indians, too, were retreating before the thrusts of civilization, and soon it was clear that a fur empire and population centers could not exist side by side. Suggestions began to be heard that Rupert’s Land (the Hudson Bay watershed) be annexed to Canada, a name then applied to the eastern provinces only.

The company reluctantly agreed in principle but asked £1,500,000 in payment. An impasse developed. Canada could not raise the sum, and the French of Quebec, fearing dilution of their political strength, did not want the land anyway. Expansionists tried to break through the money barrier by suggesting that the Crown, which had alienated the land long ago by giving it to the company, was now obligated to buy it back. England resisted. She did not wish to purchase a large block of land and then, if annexation failed to develop, be left to administer a treasury-draining crown colony.

The sentiment for a coast-to-coast confederation of Canada was growing, however, and it was unlikely that a monopolistic landholdingof such gargantuan proportions would be allowed to remain undisturbed. Taking advantage of the current, an investment company known as the International Financial Society startled the business world in 1863 by purchasing control of the Hudson’s Bay Company. It reorganized the firm under a new set of officers, increased its capitalization, and offered stock to the public with promises of quick profits from the sale of land to settlers. The promoters then pulled out, having reaped a goodly sum from their manipulations.

The company’s new board of directors soon realized that the tide of immigration was not yet as strong as they had been led to believe. As its new stockholders grew increasingly indignant over the failure of the land to move, the directors became more and more anxious to sell to either Canada or England—but not at just any price. And so the three-way dickering went on: Who should pay, and how much?

The situation grew intolerable. The American Midwest was filling with settlers, and Canadians feared a northward thrust by their acquisitive neighbors unless defensive measures were taken by someone stronger than the company. At the same time demands were increasing for a cross-country railroad, which, of course, could not be built through privately held land. Abruptly, in 1869, the British government solved matters by imposing terms that the company’s board of directors did not like but that they accepted rather than face a long legal battle. Under this settlement, called the Deed of Surrender, the company retained its trading rights but sold nineteen twentieths of Rupert’s Land, the socalled Fertile Belt, to Great Britain for £300,000. H.B.C. kept one twentieth—part of the Fertile Belt in the west—to sell for settlement. Britain then allowed Canada, which had become a confederated dominion in 1867, to annex the entire area.

As its land commissioner to sell off the reserved one twentieth of its former holdings (some seven million acres), the directors chose lean, hard, bushy-browed Donald A. Smith, a one-time fur trader in Labrador and former manager of the company’s Montreal district. He had scant success at first. Immigrants preferred the better-advertised fields of the American West. To help turn the tide northward (and to reap profits for himself, an activity that always commanded his exuberant attention), Smith became one of the prime movers of the Canadian Pacific Railroad. Meanwhile he acquired enough stock in the Hudson’s Bay Company so that in 1889, when he was sixty-nine, he was able to have himself elected governor in London. He was the first field man ever to attain that exalted rank.

At the turn of the century, when the arable lands of the United States were finally filled, the long-awaited rush into south-central Canada began. Millions of acres of company land sold at such fine prices that in 1906–07 stock dividends approached 50 per cent for the first time since 1688. The success was so great, indeed, that for a time it blinded Smith to another source of income inherent in the headlong growth of the Canadian West—the turning of one-time trading posts into retail stores. The company’s sagging forts and the town lots it was offering for sale were almost completely surrounded by aggressive merchants who were making good profits. Finally the board jarred itself awake, and in 1910 it started a series of studies designed to transform primitive systems of bartering into the sophisticated routines of modern retailing.

The company’s first two block-sized department stores, both several stories high, were built in 1913 in Vancouver and Calgary. A few months later, in January, 1914, Donald Smith, honored now as Lord Mount Royal and Strathcona, . died at the age of ninety-four. In the long span of his governorship his company once again had managed, as so often before, to catch up with its competitors.

The First World War interrupted the building program—but at no loss to the Hudson’s Bay Company, which used its international trading organization to purchase and transport mountains of supplies for France and Russia. When the conflict ended, land sales boomed again. This time the company matched the population growth with a swift expansion of its retail and mail-order facilities. In 1931 supervision of the chain of stores was shifted from London to a subdirectorate with headquarters in Winnipeg.

Surprisingly, the changes did not bring about as dismal a drop in fur-trade revenues as Smith himself had once predicted. Using light planes for swift communication and tractors and snowmobiles for pulling trains of sleds, the company today has pushed its trading posts to the edges of the Arctic Ocean and has developed a flourishing commerce with the Eskimos. Radisson and Groseilliers would have approved. After all, in the three hundred years since they launched the company, that has been the one unswerving goal—finding and pleasing the customers, whether in wigwams, igloos, or modern apartment houses.

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