A new factory and a new town
The year was 1858 and Fredrik Göransson struggled to build a new company and experimented with the Bessemer process. By July he had succeeded in stabilizing the process and took off for Hamburg with samples, thereafter to London to once again meet with Sir Henry Bessemer. He negotiated the right to sell his steel in England while production at Högbo Iron and Steel continued in Edsken and Högbo, though both places were far too small for Göransson’s plans. So, a new location was chosen: Sandviken, by lake Storsjön where there was both running water to drive the machines and a railroad for transporting goods.
Fredrik moved to Högbo with his family and started work on building both a factory at Sandviken and housing for workers. Early on the company saw to it that there was health care and even schooling for worker’s children.
In March 1862, workers could transport stone across the still-frozen lake for the foundations to buildings and by the end of 1862, the main factory building was standing, two furnaces had been bricked up and a canal had been dug from Jädraån river, providing water to drive the machines. But delays in machine deliveries meant production could anyway not start until mid-1863.
Fredrik travelled, building a team of sales agents around Europe, including some he knew from his Elfstrand days. Sales to the different markets varied in the 1860’s. Sometimes the biggest market was England, sometimes France or Germany, sometimes Russia, which for a period was Fredrik’s most important market for the railroad wheel rings.
At that time, there were also complex financial problems with more expense than income. Fredrik came to rely more and more on his friend and business associate in London, Pontus Kleman, who managed to arrange several short credits for the company. Without those, he couldn’t keep the factory operating at all. Time was running out for Fredrik and he needed to find a different solution for the company.