Thursday, March 26, 2009

Wards, America's Cheapest Cash House

The 1872 founding of Montgomery Ward & Co. was not just the beginning of a company, but of an entire industry – one that thrives today, years after Wards ceased to be a major part of it, or to exist at all. Mail order pioneer, Chicago legend, and nationwide department store fixture, Montgomery Ward is part of the American story – mention the name “Monkey Wards” and most folks will know what you’re talking about, whether their family shopped there or not.

The company’s founder, Aaron Montgomery Ward, was not a Midwesterner by birth. Born in Chatham, New Jersey in 1844, Ward and his family “headed west” when he was 8 years old, settling in Niles, Michigan. Later on, Ward moved some 30 miles away to St. Joseph, on the shores of Lake Michigan, where he took a job as a retail clerk. Within three years, Ward was running the store. In 1866, at age 22, Ward moved to Chicago, where he accepted a position with the new wholesale “dry goods” firm Field, Palmer and Leiter, forerunner to Marshall Field and Company. After two years with the Field firm and one with another company, Ward moved to St. Louis to work as a traveling salesman for another wholesaler, calling on stores via horse and buggy. Before long, Ward was back in Chicago, working for yet another wholesale firm, C.W. Pardridge Co.

Over the previous couple of years, while in the employ of others, Ward was diligently developing his own business idea, one based on his observations of the farmers who patronized the stores on his wholesale routes. In those days, rural customers generally had to contend with high prices on a very limited merchandise selection. Ward came up with an idea for a “mail order store”, where catalogs (which were initially just “merchandise price lists”) were mailed out to potential customers far and wide. Orders would be mailed to and shipped out of a centralized warehouse. By 1871, Ward had saved up enough money to give it a go, and began to stock up on merchandise to sell though his own catalog.

On October 8, 1871, the great Chicago fire struck, destroying major parts of the city, including countless homes and businesses. While Ward’s employer’s (the Pardridge firm) business escaped unscathed, the stock of merchandise Ward had put together for his own fledgling business was destroyed. “Like the rest of the city”, as Ward’s 1972 100th anniversary publication put it, “Ward dusted himself off and went back to work”. By the following August, two of Ward’s fellow Pardridge employees had joined him, and with $1600 in hand Ward purchased new goods, rented an office on North Clark Street and issued his first one-page price list.

The rise of Montgomery Ward & Co. coincided with that of the National Grange of Husbandry, an organization dedicated to advancing the interests of the farmer. Known popularly as “the Grange”, local chapters were set up in rural areas far and near. Starting as basically a social organization, the Granges quickly gained power and political influence in their communities. Wisely, Ward closely aligned his company with the Granges, sending out price lists to each Grange Hall and encouraging members to pool their orders to save on shipping costs. For decades, even after the Granges’ influence had receded, Montgomery Ward was thought of by many as “The Grange Supply House”.

Ward received an unlikely boost from what could have been a disastrous event in the young company’s life. On November 8, 1873, the Chicago Tribune published a blistering editorial about the company entitled “Grangers beware. Don’t Patronize Montgomery Ward & Co. – They are Dead-Beats!” The rousing headline was followed with a series of charges – “Another attempt at swindling has come to light”…”they keep altogether from the public gaze, and are only to be reached through correspondence sent to a certain box in the Post Office.” Ward’s customers were caught in the crossfire as well – “it is known that a certain proportion of the multitudes of circulars issued fall into the hands of credulous fools, who place boundless faith in anything which is set up in type and printed. If such fools would only consider how easy a thing it is to start a swindle of this kind, the dead-beats who get them up would be driven to hard work, or still better, perhaps, starvation.” Ah, the journalistic restraint of days gone by! Ward threatened to sue.

The Tribune’s retraction, published in the December 24th edition, would prove to be worth its weight in gold to Wards. An early paragraph read: “The (November 8) article was based on what was supposed to be correct information, but a thorough investigation by this office satisfies us that the article was grossly unjust, and not warranted by the real facts. The firm of Montgomery, Ward & Co. is a bona fide firm, composed of respectable persons, and doing a perfectly legitimate business in a perfectly legitimate manner.” Ward was so pleased with it that he reprinted the article in its entirety in his next price list.

In 1874, Ward, now joined by his brother-in-law George Thorne as a partner, moved his business to a larger building at the corner of State and Kinzie Streets. Through the remainder of the 19th century, Montgomery Ward & Co. grew impressively, and the Wards catalog, which had evolved from the simplest type-set sheet to a 150-plus page magazine with ornate engraved covers, was wildly popular with consumers across the entire country, but especially so in the nation’s frontier heartland. In addition to clothing and farm goods, Ward carried groceries, and for a few years, liquor. In these years, Wards advocated for their customers by battling a number of industry trusts, which had attempted to fix prices on such basic needs as sugar and binding twine.

Ward and Thorne gradually turned the day-to-day management of the company over to younger men, including Thorne’s five sons, all of whom would eventually join the business. In 1887, Montgomery Ward moved to a new six-story building on Michigan Avenue, which would be expanded many times by the end of the century. In June 1889, the Ward-Thorne partnership was formally chartered as a corporation.

In 1893, Sears Roebuck and Co. was incorporated, moving their offices from Minneapolis to Chicago the following year. In just a few short years, Sears, who adapted the mantra “Cheapest Supply House on Earth” (similar to Wards’ “Cheapest Cash House in America”) emerged as Montgomery Ward’s chief rival, and what would be a century-long rivalry was underway.

1893 was a key year for Ward in a number of other ways. The company gave away tens of thousands of a special “World’s Fair Edition” of its catalog at Chicago’s Columbian Exposition. Even more important than that was Congress’ passage of the Rural Free Delivery Act (R.F.D.) which opened the door to mail delivery to individual rural homes. Prior to that, most country dwellers had to pick up their mail from a post office. As R.F.D. was implemented, Wards’ catalog deliveries and sales skyrocketed, provoking the ire of local country merchants. A number of them staged “catalog burnings”, encouraging locals to toss their treasured Wards catalogs into a bonfire - something the founder took as a true validation of his company’s success.

That same year, Ward sold his majority interest in the company to George Thorne. By this time, Ward was devoting his full-time energies to a new passion – the preservation of Chicago’s lakefront as a city park, off-limits to developers. More than anyone else, Ward deserves the credit for the priceless asset that is Chicago’s Grant Park. Ward fought for twenty years and through four legendary court battles to achieve this, losing many friends among Chicago’s business and social elite along the way. Aaron Montgomery Ward, retail and environmentalist pioneer, known in his last years as “the watchdog of the lakefront”, passed away at the age of 70 on December 7, 1913.

His namesake company continued to thrive. In 1908, Montgomery Ward opened its massive new distribution center, a 500-foot long, 9-story high, 2 million square foot colossus along Chicago’s riverfront, a facility the company would use into the 1970’s. Wards had opened its first of many branch operation “catalog houses” in Kansas City in 1904, replacing it with a much larger building in 1907. Later on, Wards would open more of these huge facilities – in Oakland in 1923, Baltimore in 1925, Fort Worth in 1928, and Albany, NY and Denver in 1929.

George Thorne’s sons had operated the company with varying degrees of efficiency in the early years of the 20th century. Today, the Thorne name is probably best known in Chicago in connection with the “Thorne Rooms”, a fascinating collection of miniature dioramas first exhibited in the 1930’s at the Art Institute of Chicago. They were conceived and funded by Mrs. James Ward Thorne, the wife of one of Mr. Thorne’s sons.

One brilliant hire they made was Robert E. Wood, a former World War I Quartermaster General, who shaped up their distribution system and advanced a new idea to help the company get the most mileage out of its gigantic branch warehouse operations – to open 40 to 50 retail stores within a radius of each “catalog house”, tapping the revenue possibilities of these facilities, adding a potential $20 million a year to Wards’ coffers. Alas, General Wood proved to be “the one that got away”, leaving Wards, whose top management was painfully slow to respond to his proposal, for Sears, Roebuck and Co. in 1924. Wood, who at Sears would become one of the most legendary retail figures of the 20th century, opened Sears’ first retail store the following year. 350 Sears stores would be in operation by 1930, drastically changing the competitive dynamic between the two companies.

By 1927, the Montgomery Ward management had come to view their lack of a retail store presence as a mistake. A decision was made to open a handful of “display stores”, under the assumption that customers would be favorably inclined to buy merchandise they could actually touch as opposed to making their decision based only in catalog pictures. The problem was, the term “display store” meant exactly that – customers could order but not bring home the merchandise! It would be shipped to them in the standard manner from the closest Wards warehouse. The goal was to rotate the selection of merchandise shown in the display stores, choosing from Wards’ then 33,000 different items carried. The first display stores were slated for “Marysville, Kansas, Plymouth, Indiana and Little Falls, Minnesota, all good mail order areas”, according to the Wards 100th Anniversary book.

The conversion of the Plymouth, Indiana store from a purely “display” store to a conventional retail store happened in an interesting way, as related in story in the Anniversary book. Although the Plymouth display store was well-received, there was a fair amount of frustration expressed by customers about the inability to buy and take home the merchandise on the spot. This led to grumblings to the effect that Wards’ display units might be superior quality to the actual products shipped, a classic “bait-and-switch”, that in this case was patently untrue. It all came to a head one day when a carpenter showed up at the store and noticed that a saw was selling for 75 cents less than he could buy a comparable one for down the street. When told of the store’s policy, the carpenter became irate, demanding to buy and take home the saw. Finally the store manager relented and sold it to him. When word of this got around, the store was besieged, and was forced to sell off their sample stock to the clamoring public.

Montgomery Ward brass, upset about this at first, began to come around when the profit potential became too obvious to ignore. A test program was put in place with eight more display stores, now allowed to stock and sell the actual products, was put in place. The following year, now satisfied with the idea, Ward’s board of directors put the pedal to the metal, approving a program to open 212 retail stores in 1928.

Were it not for that carpenter, would any of us have “Monkey Wards” store shopping memories today? It boggles the mind - almost too deep to ponder.

The photo above, from the book “1872-1972 A Century of Serving Consumers – the Story of Montgomery Ward”, depicts the Plymouth, Indiana display store discussed above. Below are two photos from the E.M. Ball Photographic Collection (1918-1969), Special Collections, D.H. Ramsey Library, University of North Carolina at Asheville depicting two early Montgomery Ward stores in Asheville, North Carolina, the first on Biltmore Avenue and the second on Patton Avenue, both circa 1930’s.


  1. As R.F.D. was implemented, Wards’ catalog deliveries and sales skyrocketed, provoking the ire of local country merchants, a number of whom staged “catalog burnings”, encouraging locals to toss their treasured Wards catalogs into a bonfire, something the founder took as a true validation of his company’s success

    This is a pretty disturbing image but kind of amusing in a way.

    Mr. Ward fought hard to free up space in Chicago's lakefront and I am glad he did because were it not for him it would not be free and open space.

  2. Very interesting. This explains why Wards seemed to have rather old small town stores, while playing catch-up in metropolitan areas.

  3. Didi - I'm glad as well! He never got credit for it in his lifetime, at least not compared to the flak he took for it.

    Anonymous - Thanks. The really played catch-up throughout most of their history. Sears expanded more aggressively and much earlier, when it was a far cheaper thing to do.

  4. The rise of Montgomery Ward & Co. coincided with that of the National Grange of Husbandry, an organization dedicated to advancing the interests of the farmer. Known popularly as “the Grange”, local chapters were set up in rural areas far and near.

    Interesting article. As an aside, I learned two bits of information. First, why Chicago has a far more attractive downtown than most of its peers. Second, I think I found out why my insurance company is called "Grange Mutual". It's amazing the number of companies which trace their roots to serving farmers, especially in the insurance business.