The Harmony Company was founded by Wilhelm Schultz in 1892. Thus began the most successful American made stringed instrument producer ever.
Wilhelm immigrated to America to work for the Knapp Drum Company of Chicago. In 1892 he bought a two room loft on the top floor of the Edison Building at Washington and Market Streets, later the site of Chicago's Civic Opera House.
By 1894, the Harmony Company had 40 employees. In 1904 a larger location was acquired and the business settled in their own 3 story 30,000 square foot factory at 1738-1754 Lawndale Ave. A new wing was added in 1906. By 1915 Harmony had 125 employees.
In 1915 Harmony was the first large scale ukulele builder. In 1916 Sears wanted to corner the market on ukulele sales (they were extremely popular at the time) so they bought the worlds ukulele leader, Harmony.
In 1916, the Sears, Roebuck Company purchased Harmony and appointed Jay Kraus as vice-president. The following year Jay succeeded founder Wilhelm Schultz as president. By 1923, Harmony stated annual sales of 250,000 units. Later in the decade, (Feb. 1928) Harmony introduced the first of many Roy Smeck models. (Who was Roy Smeck?Click Here) The first models were called the Roy Smeck Vita series.
In 1930, annual sales were reported to be 500,000 units sold. The amount of instruments being produced by Harmony made up the largest percentage of stringed instruments being manufactured in the U.S. at that time, and Harmony made them all: guitars - archtops, flat-tops, electric Spanish, Hawaiian bodies, ukuleles, banjos, mandolins, violins and more. They continued to turn in impressive annual sales figures right up till the company was dissolved.
In 1930 the Roy Smeck Grand Concert and Hawaiian models were unveiled and in 1931 the Vagabond guitar line was first produced. In 1938 Harmony returned to violin production after a 19 year hiatus and in 1939 Harmony bought several brand names from the bankrupt Oscar Schmidt Company. These names included: La Scala, Stella and Sovereign.
In February 1940, Jay Kraus resigned as the President of Harmony. John T. Higgins was named as new company head. Then in December 1940, Jay Kraus bought the firm by acquiring controlling stock. In 1941, he moved the company to 3633 Racine Ave. Jay remained as head of the company until his death in 1968.
Charles Rubovits, who had been with Harmony since 1935, took over as president, remaining in that position till the dissolution of the company. Charles had the reputation as a man who knew how to sell guitars. The company continued to prosper under Rubovits, but the competition from Asia and So. America where labor costs are low was starting to show.
The Harmony Company actually was always behind on orders, not that they were slow in building instruments, it was sheer demand outpacing the workforce. Harmony had the choice of either enlarging their operation to meet the demand, or let foreign makers take up the slack. The management of Harmony were too conservative and decided not to expand their operation. This allowed the floodgates to open and the world saw Asian companies take the low to medium grade instrument market away from the American companies.
In 1975 the Harmony Guitar Co. in Chicago ceased operations and had a huge three day auction. The auction was huge since it was two city blocks under one roof.
All the equipment was right where it had been when the factory was up and running. You could walk through the building and see just how the factory operated. All the wood and other parts had been put on pallets and was sitting in the shipping area to be sold. The problem was that each lot was so huge that no one that were interested in the guitar parts could afford the lots. Stan Werbin, who then and now owned Elderly instruments in East Lansing Michigan, started a bidding cartel made up of those who were interested in guitar stuff. Some of the other cartel members included Tut Taylor and Greg Lake (Great Lake Banjos).
Harmony instruments carried many brand names, Valencia, Johnny Marvin, Vogue, Airline, Fender, Kay and Regal are a few of the more notable names which Harmony produced several models of guitars, but Silvertone offered by Sears is probably the most common. Later in the 70's the Harmony name was sold to be used on Asian guitars.
During the 1980's, Harmony underwent several owner and management changes. In the mid to late 80's Harmony introduced several decent copies of Gibson and Fender designs. The 1990's saw Harmony sell most of their guitars to J. C. Penny stores. During this time, Harmony was not commonly seen.
In 2000 M.B.T. International made a deal to use the Harmony name on guitars and other instruments. They re-issued several popular old U.S.A. Harmony models. These models were appreciated by all Harmony fans everywhere. Unfortunately, M.B.T. and the actual owner of the Harmony trade name came to an impasse and M.B.T. ceased marketing Harmony.
In 2009, the Harmony trademark and all intellectual property was acquired by Westheimer corpoaration in Northbrook , IL. In 2011 they debuted the New Harmony Vintage Reissue series. The Vintage Ressiue series are true to the original designs but feature much improved; finish, hardware, and pliability. The H-22 Bass, H49 Jupiter-Stratotone, and H54 Rocket are available now. Other models will be later in 2012.