(This is the second installment of a history of the Royall Cotton Mill, later the Royal Mill, based on a thesis written by Don P. Johnston Jr. in 1945 for a degree from Princeton University. His father, Don P. Johnston, was the president of Royall Mill before and during the Depression.)
Royall Cotton Mill was purposely built outside the town limits of the Town of Wake Forest College (which in 1909 was rechartered as the Town of Wake Forest). As Robert E. Royall wrote in a 1929 letter: “. . . I purposely declined every offer of location that was made us within said town of Wake Forest. And the longer we live, the more fortunate it appears that we are outside of said town. Our Town taxes, if we were in the Town of Wake Forest, would be very nearly as much as we now pay the County of Wake. In other words, we are saving $8,000 or $9,000 by not being in the Town of Wake Forest. But only my personal popularity, and our intimacy with the really influential citizens here have saved this mill property from being thus taxed. For, as in all other similarly situated mill villages, the people who live in the nearby town look with hungry eyes at the prospect of including the valuable properties just on the outside. . . . ”
(In 1907 the village was incorporated by the North Carolina General Assembly as the Village of Royall Cotton Mill, and that incorporation was repealed in 1943 at the request of the mill owners.)
When the directors met on April 3, 1900, the treasurer (Robert E. Royall) was empowered to purchase from William Powell (board member and president) and Robert Royall the 25 acres north of the Town of Wake Forest College that Powell and Royall had purchased in 1884. Johnston Jr. never mentions what Powell and Royall had paid for the 25 acres nor does he mention what the mill corporation paid the two men for that land.
He does say: “. . . in April 1900 the mill site was carefully bought outside the town limits. And at the directors’ meeting of July 30, 1900, additional land purchases were approved, bringing the total real estate investment of Royall Mills to about $4,900 for 47 acres. (A purchase of about 20 acres was made from W.S. Holding for less than $1,700 and lesser tracts for about $500. Of the latter, one lot had to be purchased at a small premium “as the spur track from the Main Line of the Seaboard Air Line to our Mill runs through the land thus conveyed to us by Dent and wife. The spur cost $1,250 in addition to the land cost of about $170.)
The original pledge of stock in October of 1899 had been $51,500 with $30,000 pledged by William Powell and his children as well as $39,000 by his brother and his business associates and friends in Florida, Georgia and the Carolinas. Robert Royall pledged $15,000 and people in town, most of them connected to the college or friends of the mill principals, pledged $8,000.
By April of 1900 additional pledges — $5,000 by Robert Royall and $8,100 by various other friends – brought the total to $105,100, and the directors ordered that the total subscription should not exceed $110,000. That total was reached by early 1901 because Robert Royall pledged another $3,900 and a business friend of William Powell pledged $1,000.
However, then Royall began buying the land, all 47 acres, and paying the architect’s fees, the treasurer’s salary of $100 a month, the materials for building the mill, the equipment, the labor for all that and the material and labor for 30 “operatives” houses. We know that Benjamin Thomas Hicks, known as Tom, was the builder for those four-room houses with four fireplaces sharing a common flue that housed two families each.
Most of the pledges were just that, with the pledgers paying as little as 10 percent of their individual totals, meaning the mill had just $43,350 in cash of which $1,700 was in the bank and over $11,000 had been loaned at 6 percent to William Powell’s company, the Southern Naval Stores Company, and to W.C. Brewer & Company. William Brewer was one of the original charter members.
In September of 1900 at the annual stockholders’ meeting, treasurer Robert Royall reported almost $54,000 spent on building the mill and the village and that contracts worth $100,000 for mill machinery had been let. The mill board needed to increase the capital stock to $150,000, which meant they offered new subscriptions to those who had already purchased stock. They also turned to another source of funding, and here we will quote at length what Johnston Jr. wrote.
“On December 31, 1900, the directors authorized the company to “borrow five hundred ($500) from the Trustees of the North Carolina Baptist Students’ Aid Fund.” In later years more money was borrowed from this and similar funds. Finally the loans were combined and known as the Denmark Loan Fund, the total debt to students reaching $10,000. Interest at 6 percent was paid on this loan, and it is evident that, to all intents, an unprotected quasi-preferred stock position existed. At any rate, the purpose seems to have been to give a secure and lucrative place of investment to a “worthy cause.” Deposits were later accepted from non-philanthropic sources as well, the families of those interested in the mill. (During the decline and debacle of the 20s and 30s, the mill loaned heavily to those same families – over $43,000 in one instance. These loans largely were never repaid and seem to be among the causes for the final insolvency of Royall Mills. Also, when the corporation was run through the wringer in 1931 for the receivership, the Denmark Loan Fund suffered. Not until 1945 did the college receive from an individual connected with the mill a gift more than large enough to compensate for this loss. This last information is from a confidential source.)
But that would be in the future. On September 10, 1901, Robert Royall was able to give a rosy treasurer’s report: “We have since our last meeting completed our 30 Operatives’ Houses, our Cotton Warehouse, Store, and Mill Buildings and have installed in the last named all the items that go to constitute our Power Plant, Fire Protection, and General Equipment, and also all the Textile Machinery that we originally contemplated. We have been running the Mill 66 hours per week for about two months; and in spite of the fact that the prices for yarns are very low, as compared with the price of cotton, we intend to begin on the 16th inst. to also operate a night force. Having a good location and exceptionally attractive and comfortable houses for our operatives, we are finding no trouble to get labor, and that, too, of a class better than the average. We have every facility for making the very best yarns and warps at as little cost as any Mill of its size in this section. Our very elaborate system of Fire Protection secures us the very lowest rate of insurance on all our property; our water supply is unlimited and never-failing; our Steam Plant is efficient and economical in its operation; our Superintendent and his lieutenants are discreet, expert, wide-awake, looking well to the proper speeding of our machines, and the getting off of the proper amount of production every day and taking real interest in the success of the mill.
“Your President and Secretary, though rendering valuable service, receive no compensation. Your Treasurer, though giving his entire time and attention to the business of the Mill, is content to receive a very moderate salary and to hope that more prosperous markets and conditions may be vouchsafed us in the not too distant future. In a word, we are conducting our affairs upon an economical basis and of this I am confident.
“Our mercantile business (the company store near the mill and in the mill village) is being managed conservatively and proves a great convenience to our Mill people; and while it adds no little to your Treasurer’s responsibilities, he is satisfied that it is an indispensable feature of our business.
“So far, what little yarn we have made, we believe we have sold it at as good prices as any mill has obtained. We have not tied up to any one Commission House, and our goal is to sell wherever and to whomsoever it shall from time to time seem to our interest to sell.
“Our plant has, in every detail and as a whole, cost more money than any of us at first expected. But it is first-class in all respects, and it is my opinion, and the opinion of our President who has looked well into our expenditures and knows just how the money has gone – yes it is our opinion & also that of certain men expert in all matters pertaining to Cotton Mill Equipments, that we have in our Plant the full equivalent of all the money we have paid for it – and that our Stock will eventually prove a good investment.”
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