Saturday, May 23, 2009

The Sixties Winn-Dixies

A set of views from the 1960’s, an exciting time in the history of Winn-Dixie. By the early sixties, Winn-Dixie was impressing the socks off of the financial community, and as Forbes magazine put it in 1962, was “the envy of the nation’s grocers”. In an industry that has always depended on gargantuan volume at a tiny profit percentage (typically 1 to 1.5 percent after taxes), Winn-Dixie, at upwards of 2 percent, was outpacing even the largest grocery chains. During this period, the Davis brothers, majority owners of Winn-Dixie, took the unusual step of buying advertising space in The Wall Street Journal and The New York Times, pitching the company’s stock to the investment elite. Given Winn-Dixie’s performance, they found many willing takers.

By the fall of 1963, the company’s notoriety had spread beyond the business pages to America’s coffeetables – the September 20th issue of Time magazine featured an article entitled “Winning in Dixie”. The article hailed the company’s “unusual” management setup (Forbes had called it “informal”) and outlined their philosophy for success – fast inventory turnover, monthly (!) dividend checks to stockholders, and the three-part mantra “Stay liquid, sell for cash, and don’t buy real estate”. The article even featured a personality profile of sorts of the four Davis brothers, as expounded by J.E. Davis, the company chairman: “I’m the conservative element, the long-range planner. A.D. (W-D president) is always the aggressive expansionist. Austin (executive v.p.) specializes in the big stores, and Tine (head of the Montgomery division) is the personality boy”.

Closer to home, Winn-Dixie used a number of marketing approaches to endear itself to customers, the most famous of which at that time was the company’s annual “Dixie Products Days” promotion, held in the stores each May. The objective of “Dixie Products Days” was to spotlight locally grown and/or manufactured food products - the bounty of the “New South”, in effect. The stores took it to heart, outfitting their employees in period dress – “southern belle” bonnets for female employees and straw hats for the guys. And Winn-Dixie didn’t hesitate to enlist big names in the cause. In 1963, for example, in a wonderful confluence of government and commerce (common then and hard to imagine today), then-Florida Governor Farris Bryant issued an official proclamation for Dixie Products Days. It all made for a hit with customers in that provincial era.

You’ll note in the last photo the S&H Green Stamps signs on either side of the store name. By the mid 60’s, trading stamps had become the “equivalent of chronic lower back pain” for supermarket executives. Chains that hadn’t previously used them would adopt them in order to defend their turf. Other chains dropped them in favor of an “everyday low price” strategy, again usually as a defensive measure. A&P’s store managers finally convinced the powers in charge to allow them to issue stamps, on a division-by-division basis. Winn-Dixie’s approach was as flexible (or schizoid, depending on your point of view) as anyone’s – some stores, like the one pictured, gave out Green Stamps, others gave out (majority Kroger-owned) Top Value stamps, while still others gave out none at all. In 1967, as reported by Forbes, the company dropped stamps in 88 southeastern Florida stores in favor of an 8 to 10% price cut.

Winn-Dixie purposefully avoided the trend towards grocery/general merchandise “combination stores”, unlike many supermarket firms across the country that had doubled the size of their stores by adding clothes, linens, toys, auto supplies and all manner of other goods. As company president A.D. Davis told Forbes magazine in 1962, “When you start competing with J.C. Penney, you have a very formidable opponent on your hands”. The company went so far as to put it in slogan form in the 1970’s – “We have not tried any new businesses, but we try awfully hard at the food distribution business”.

The only real setback for Winn-Dixie during this period came in 1966, when the Federal Trade Commission forbade the company from acquiring any more U.S. grocery firms for a ten-year period. The FTC order was spurred by an anti-trust suit filed against the company in response to two major acquisitions in the Birmingham, Alabama area – the 35-store Hill Grocery Company in 1962, and nine additional stores in Birmingham purchased two years later from Colonial Stores, Inc. While the FTC’s stated opinion was that the transaction “adversely affected competition” in the Birmingham area, the case was widely seen as an attempt to stem the tide of buyouts nationwide. In retrospect, it all seems to be kind of pointless and belated, as most of Winn-Dixie’s buyout mania had taken place several years before, and the lion’s share of their new store growth was now being generated internally. The following year, another (equally pointless and belated) FTC decision would force L.A.-based Von’s Companies to spin off the Shopping Bag supermarket chain it had acquired in 1961.

Barred for a decade from further U.S. acquisitions, Winn-Dixie’s manifest destiny led it to…the Bahamas. In 1968, the company acquired a single store in Freeport, Grand Bahama Island, and within a year had 11 stores on the islands, bearing the Winn-Dixie name (but held as a separate subsidiary). And boatloads of Crackin’ Good cookies began to wend their way through the Atlantic waters…

Rumors of a “Bahamian Products Days” are unconfirmed at this time, however.

The first photo, a 1961 artist’s rendering, features typical units for Winn-Dixie’s two main banners. The smaller footprint (average 12,000 square feet) that Winn-Dixie favored in those days is evident. The bluish-green façade background was the standard for Kwik Chek. The second, from 1964, shows a lady carefully contemplating her purchases. A box of Crackin’ Good vanilla wafers is visible, as is a new product – Pepperidge Farm Goldfish crackers, in its very first package design. (They come in gallon buckets now, right?) Third, from 1967, is a new fruit and produce department sporting the company’s 1960’s tagline on the wall. The all-important Coke machine occupies a place of honor. (Since one of Coca-Cola’s main flavor ingredients is lime juice, I find this both plausible and appropriate. Don’t you?) Fourth is a great 1967 checkout scene, where a can of Astor coffee, another marquee W-D product, can be clearly seen, and a can of Chek cola less clearly seen. I love this photo, as the lady buying the groceries has a hair and clothing style extremely similar to what my grandmother (the one from Georgia, coincidentally) wore at the time. My only living grandparent at age 89, she is in good health and has kept her appearance up with the times. (She would find this photo hilarious, although many of her surviving peer group still wear the lacquered-up hairstyle.) Last, from the same year, is an exterior view, with the letterboxed sign elegantly balanced at the edge of the roof. No, they don’t do this anymore.


  1. Great collection of colorful photos, Dave! I especially like the second one. The women looks so elegant. Too elegant to be shopping at WinnDixie!

  2. When people talked about the higher cost of food with trading stamps, S&H would use a case tsudy done by a business school that found that when W-D dropped stamps, the savings in shelf prices disappeared in a matter of months and the money appeared to go into other promotions. I think this was based on the Louisville division. This may be why they eventually converted a lot of S&H stores to Top Value. They actually kept stamps in many markets like North Carolina, New Orleans, and parts of Florida long after their competitors had dropped them. In Florida, Publix (which also kept stamps long after others had dropped them, into the 80s), happily picked up the S&H franchises as they expanded through the state.

    W-D was one of several chains that got dinged for anti-competitive acqusistions. National Tea was naother and a merger between Ralphs and Vons was prevented on these grounds.

  3. It's interesting that the Davis' didn't believe in owning real estate. One story that made the rounds when the chain was in decline, was that the Davis' owned a lot of the underlying real estate and that this would permit them to get through a bankruptcy. Certainly, they benefited from those monthly dividends.

  4. Off-topic alert!

    As promised, here is the link to the Georgian-style ex-Montgomery Ward's in Marion, Ohio. You may wish to link it within the actual article, however I am posting here because I doubt many people will look at the back articles regularly.

    Here is the link. Look closely and you can see a faded Montgomery Ward painted on the side.

  5. Didi - I agree, especially the inside the store stuff. There seemed to be no such thing as overdressing for grocery shopping in those days, or so the ad men ("Mad Men"?) would have had us believe. And as far as the older lady goes, this was an era when many women made weekly trips to the "beauty shop" to get their hair done. I remember that as a very common sight.

    Anonymous - The S&H study would be interesting to read! What I referred to in the post was a period of time in 1967 when WD was actually issuing both brands of trading stamps at the same, in different regions. Must have been a territorial issue. And as you mention, Publix remained an S&H diehard long after stamps had gone out of vogue.

    Anonymous 2 - It is interesting, and thanks for that piece of info. The bright side of not owning the real estate was that many of the shopping centers they were in were undoubtedly past their prime, and could have been an albatross.

    The 'monthly dividend' practice was unique, best I can tell, and did a lot to promote stock sales to WD employees.

    Dan - No problem at all, great pic! I was going to x-ref this to the "Wards Georgian" post, but you beat me to it!

  6. Winn-Dixie ended its ten year moratorium on acquisitions with the Kimball's of Fort Worth, TX purchase in 1976. Some the stores in the Texas panhandle and New Mexico would vote to unionize, resulting in WD shuttering the stores, leaving North Central and Northeast Texas as the primary concentration of stores-with some Oklahoma locations close to the Texas border.

    Winn-Dixie would put the Fort Worth division on the market in late 99 with Kroger agreeing to purchase the stores, but the FTC would block this merger as anti-competitive, while allowing Albertson's to take over the region's Jewel Osco/ Skaggs Alpha Beta operation a few years earlier. At the time the FTC did not classify Wal-Mart Supercenter as a supermarket competitor. If WM SuperCenters had been considered competition the sale would have likely been allowed as WMT became the largest grocer in the Metroplex around the same timeframe.

    Agreed Didi, Winn-Dixie has long been saddled with the image of being the supermarket which catered to the blue collar and rural Southerner. Perhaps even in the 1960's having Dixie as part of your name was decidedly politically incorrect.

  7. In the 60's you were never "too elegant". Having worked at Winn-Dixie "Kwik Chek" I can assure you that elegant people shopped there too. The 60's was still a time when women wore dresses - even to the grocery store. Winn Dixie was "The place to shop" then and Publix was just a second banana!

  8. Ken - Thanks for bringing the WD Texas division history up to date. Again, I'm amazed (as I always seem to be)about the FTC's refusal to allow the Kroger buyout of those stores, in view of the relative lack of competition that exists anyway today.

    JES7385 - It's always a pleasure hearing from people who worked in these stores in their heyday. I definitely agree about the elegance of those days and the fact that even where grocery or discount store shoppers were concerned, it didn't seem at all out of place. It truly is a bygone era, and one of the big factors behind the appeal of this website, so I've been told a number of times. Thanks very much!