Several other pioneer New York chains which were to retain their identities all through the years and which are were a H. C. Bohack Company, of Brooklyn, and Gristede Bros., of New York The former goes back to 1887, when H.C. Bohack opened his first store.
The Gristede story goes back to 1891, when two brothers, Charles and Diedrich Gristede, who had both worked as grocery clerks, decided to open a store of their own.
Two other extremely successful chains in today’s picture came into existence in 1899 – National Tea Co. and Jewel Tea Company. Both originated in Chicago.
Starting with a single store, National Tea’s early growth was relatively slow. By 1921, however, t had 261 stores and an aggregate volume of $16,300,000, and accelerating its expansion in line with the trend of that decade, by 1929 its stores reached a peak in number of 1,627, with sales of $90,200,000.
The Jewel Tea Co. of today does indeed stem from a seed sown in 1899, but this successful chain did not operate even a single store until 1932! Starting a very small business as tea and coffee merchants, the founders of what was to become the Jewel Tea rapidly developed a horse-and—wagon home service that was eventually to require a fleet of more than 2,500 salesman-driven motor trucks to handle its ever-growing trade. Sales in 1929 reached a total of $16,800,000. By 1962 it still maintained 1881 home service routes, but its food stores numbered 286 as it completed its 63rd year of operation on December 31, 1961. It was then was operating a successful drug chain of 31 stores which it acquired that year, a group of 4 self-service department stores and it had a substantial interest in a Belgian supermarket chain which had 10 units in operation at the end of the year and was planning a number of additional units. It gradually expanded including acquiring the Osco Drug but in 1981 it gave up its legendary routes. Today it is a subsidiary of Albertsons with 176 stores in the Chicago area.
Another typical group of this genre was Henke & Pillot, Houston, Tex., found in 1872, which is now owned by the Kroger Company; Ralph’s Grocery Co., Los Angeles, founded in 1882; Fred W. Albrecht Co., Akron, Ohio, founded in 1891; and Standard Grocery Co., Indianapolis, founded in 1897 by Lafayette Jackson, who was to figure as plaintiff some 30 years later in a case which made chain-store history.
Perhaps the greatest of all chain stores that were established in the first half century of the concept, second only to A &P was Woolworths, supra. Frank W. Woolworth started with a single 5 and 10 cent store in Lancaster, Pennsylvania and before it was passed in the 2oth century by A&P it became the #1 retail company in sales in the world.
In the drug field, for instance, at least 13 chains were operating by 1962 in various parts of the country can trace their lineage back to a parent store established in the second half of the 19th century. Among the oldest are the Sclegel Drug Stores, Davenport, IA, established in 1850, and Meyer Brothers Company, Fort Wayne, IN, in 1852. T. P. Taylor & Co., Atlanta (now owned by Haag Drug Co., IN) were both founded in 1879 – the year Frank Woolworth got his first successful store underway.
Originating in this period and therefore deserving mention at this point because of the important part they were destined to play in the chain store field although neither of them operated even a single retail store until after the post-war depression of 1921, are two Chicago companies. That seeming paradox is explained by the fact that the companies in question, Montgomery Ward & Co., hereafter referred to as Ward’s and Sears, Roebuck & Co., hereafter as Sears, both started in life as mail-order houses and confined their retail activities to that type of distribution for more than 50 years in the one case and for nearly 40 years in the other before they decided that the time was ripe to operate retail stores as well. Both became major department store chains, not variety or drugstore chains, or supermarkets as the aforementioned companies.
Ward’s was founded in 1872, Sears in 1886. The latter was destined to become the second largest retail organization in the world. Its sales for the year ending January 31, 1961, were $4.3 billion. Only A&P, with sales that year of $5.2 billion, sold more. Ward’s had sales of $1.2 billion. Both Wards and Woolworths, whose names have been purchased and preserved outside of the United States for the most part are defunct. This juggernaut that is the story of this book is one of, and probably the main reason why. Woodco, infra was a bold attempt in 1962 as will be told later but it simply was not operated in the manner that bred long-term discount department store success, ala Walmart.
The early chain store companies were successful not only because of creative founders who at least initially had drive, perseverance and understood where they could expand. Two fundamental legal changes during the late 1880s and the 1890s gave the movement even more potential. First, a series of Supreme Court cases beginning in 1886 granted the corporation the legal rights of a person, without a person’s legal accountability. Secondly, the Court, along with the states, extended protection to new kinds of corporate assets.
The first chain department store, Golden Rule, became J.C. Penney & Co.
The new laws made the limited-purpose charter a thing of the past, promoted the separation of management from ownership, and encouraged the growth of genuinely national enterprises.
Turn-of-the-century Americans 100 years ago met these corporations as customers of small groceries and variety stores, large drug chains, huge mail-order firms, city department stores, country general stores, and many other kinds of retail operations. Some of these still offered the face-to-face personal relationships traditional to retailing; in others, customers became consumers, experiencing personally the cultural trend that would characterize twentieth-century buying. As participants in the branded mass market, consumers entered mutually dependent but unequal relationships with large corporations.
In future chapters and volumes we tell as the noted national radio broadcaster and Americana observer and commentator Paul The Rest of the Story, including how some of these chains grew to unheard of popularity and wealth, how almost every one that did rise to the top of American retailing followed the Product Life Cycle discussed above and ultimately failed, or those that never quite cut it. The ones that did survive the longest were able to change their formats, which today the best examples of this flexibility, a double-edged sword whenever a company departs from its core consistency are Walmart and the new kid on the block who is already growing into a giant amazon.com. As told below the chains beginning the Roaring 20’s came under attack by those that did not have, jealousy and unscrupulous commentators, parasites and single-minded politicians who came very close to destroying A&P and Woolworths, in the 30’s when they still the top two retailers in the world.
Without revitalization products and retailers without exception rise and fall in four stages.
Today, the small format chain stores exist in the form of hardware cooperative chains like Ace and True Value and the olilopolies (a market form in which a market or industry is dominated by a small number of sellers (oligopolists). Oligopolies can result from various forms of collusion which reduce competition and lead to higher costs for consumers).