History of milk chocolate in the UK 

The invention of milk chocolate can be traced back to the 1870s when Daniel Peter first attempted to produce it in Vevey, Switzerland. His main concern was to remove water from the milk that he was using and keep it from developing mould. In the milk processing factory next door Henri Nestle had solved the problem by condensing milk in the presence of sugar. Daniel Peter found that by drying his dark chocolate paste with Nestle's sweetened condensed milk he could achieve his aim. In the process the milk chocolate he developed was based on so called milk 'crumb'. (Crumb is so called because of the aerated, bread-like texture that the batch oven produced material adopted in the beginning). Peter was also allied by marriage to Cailler, another Swiss chocolate maker. Between them they were able to create a sizeable market for quality milk chocolate first of all in Switzerland and then in the 1890s in the UK as well. Cailler today claims to make the only Swiss milk chocolate containing condensed milk in its recipe.

Cadbury in the 1890s was making small quantities of milk chocolate from a rather poor and variable quality milk powder.The threat from crumb based Swiss imports was taken seriously and experiments to incorporate the solids of fresh full cream milk into chocolate began in 1898 with the purchase of vacuum boiling pans to make sweetened condensed milk. The chosen recipe was of a low milk solids type to compete with Peters, similar to current continental milk chocolates with 14% milk solids. Competition was fierce, so much so that staff had to be shed from the moulding department in 1902. A significant change in strategy was made in 1903 when Cailler introduced a different type of milk chocolate containing a much larger percentage of milk and a paler colour. The Cadbury board decided to investigate this new type of pale milk chocolate and adopted the name Dairy Milk Chocolate. Cadbury Dairy Milk (CDM) was launched in 1905 and its growth was phenomenal with more than 20,000 tonnes being produced by the early 1930s.

It soon became evident that Bournville was not the place in which to condense milk on the vast scale that was now required. Transport was slow, and in summer milk arriving by horse drawn cart to Bournville could be sour. Rather than take the milk to the cocoa and sugar, the logical step was taken to build milk processing factories where the milk fields were, and transport stable cocoa and sugar to the country. In this they were copying Cailler who had built his chocolate factory in a prime dairy region of Switzerland at Gruyere. This is why Cadbury built crumb processing factories, first at Knighton by the Shropshire Union Canal in 1911, then at Frampton by the Gloucester and Berkeley Ship Canal in 1915. Finally Marlbrook was opened in the 1930s. All these sites had a plentiful supply of fresh water for secondary cooling, and the first two were sited by canals to transport the crumb to Bournville.

Hershey in the USA also moved into milk chocolate production via a crumb route in the early 1900s. Milton Hershey chose Derry Church, Pennsylvania for his factory because of the abundance of fresh milk in the area, and made his first crumb based milk chocolate bars in 1905.

Further data under construction: this just an interesting taster!