J.C. Penney, King of the Soft Goods

Reaching its silver anniversary in 1927, the J.C. Penney Company found many reasons to celebrate. The amount of Penney stores had more than doubled since 1920 to more than 750 locations “in practically every State in the Union” according to the New York Times (close to it - 45 of the then 48 states), and annual sales of nearly $116 million.  

By this time the founder himself, James Cash Penney, had largely turned over leadership of the company to others while he vigorously pursued various philanthropic interests, most importantly a program to enhance America’s agricultural production. A farm boy at heart, Penney donated millions towards the development of dairy cattle herds, soil improvement initiatives and crop science, particularly in the South.  An October 10, 1929 article in the Atlanta Constitution summed it up as follows: “In his breadth of vision, unselfishness of purpose and devotion to the upbuilding of our agricultural interests, Mr. Penney is doing a work which stamps him as one of America’s outstanding citizens”.    

Two weeks after the article appeared, though, came the great Wall Street crash - the prelude to years of hard times for many American individuals and institutions. J.C. Penney the company weathered the depression reasonably well, although it would be five years before it again reached the lofty peak of its 1929 sales of $209 million. For J.C. Penney the man, however, those years were devastating. 

As it happened, Penney literally “gave away” his personal fortune during the 20’s and early 30’s, funding the various farm interests and other good causes to the tune of millions, with little awareness of the increasing gravity of the country’s (and his own personal) economic situation. In 1931, Penney’s lawyers advised him he was “virtually broke”, a story recounted in author Bill Hare’s “Celebration of Fools: An Inside Look at the Rise and Fall of JCPenney”, a rattling read. A number of top Penney managers, in an effort led by Penney president Earl Sams, pooled money to buy the founder a new set of shares in own namesake company, and for the first time in years the company paid him a salary. These were the first steps towards setting Penney, “an incalculable asset to the company that (he) founded and built”, as Hare wrote (in Sams’ voice), back on his feet. “After three years he would cease taking the salary, and by 1940, when the company declared a dividend of $5 per share, he owned 51,000 of them. But the going was rough at first.”

This incident also sparked a much-publicized spiritual awakening in the despondent Penney’s life, which occurred during a visit to the famed Battle Creek (Michigan) Sanitarium, founded by John Harvey Kellogg (brother of W.K. Kellogg, the cereal king). Mary Elizabeth Curry, in her fine book Creating An American Institution: The Merchandising Genius of J.C. Penney, tells the story of one early morning when Penney walked the halls of the sanitarium and overheard a chapel service where an old hymn called “God will take care of you” was being sung. Penney joined the service, “and asked God to help him, and what occurred next was so personally dramatic he liked to call if a miracle. He felt as though a heavy burden, all his fears and worries, had immediately lifted from his shoulders”, Curry writes. Penney himself wrote numerous books and gave hundreds of talks on the subject in the ensuing decades, alongside and as part of his emissary work for the company. Penney was by no means the only “famous businessman - preacher” of his time, but certainly among the best known. Such a combination is relatively rare in high profile business today.

As if the economic conditions of the 1930’s weren’t difficult enough, the Penney Company faced another hurdle in the form of the brewing “Anti-Chain Store” movement. As early as the mid-20’s there were rumblings in the press about the “So-Called Menace of Chain Stores”, as a December 1926 New York Times article phrased it. The company generally offered a “low-key response” to such challenges, according to Mary Elizabeth Curry, preferring to “emphasize service and values for customers”. “It isn’t the purpose and it isn’t the desire for our organization or to destroy the independent merchant. Our job is to serve well a community through our plan of economic distribution”, Curry quotes a Penney executive from 1930.

Push came to shove a few years later with the advent of the Patman Bill, a proposed piece of legislation that would have literally taxed many chain store operations out of existence. Faced with this, the company was forced to take a much stronger tack, and it was Penney’s chairman, Earl C. Sams, who took the lead in the matter, testifying before Congress in 1940.  He laid out Penney’s case against the bill in five main points, as quoted in the landmark book “Chain Stores in America 1859-1950” by Godfrey M. Lebhar: “1) It would destroy the Penney company or any similar company. 2) It would destroy the finest field of opportunity that has ever existed in retailing for the young ambitious man born without family means. 3) It would add to the cost of living for every American family of limited means and would lower the American standard of living. 4) It would deal a staggering blow to the entire economic life of this country and would be especially destructive of the smaller cities and towns for the benefit of larger cities. 5) It would hurt and tax this entire nation for the protection and enrichment of a small minority of self-interested middlemen and of another small minority group of ill-advised marginal retailers.”

Beyond that, Sams attempted to debunk the theory “that chain stores were ruining the smaller communities”. The real culprit, he maintained, was the proliferation of quality, paved roadways that now enabled Americans to travel far afield to shop – no longer were they captive to the ‘local town square’ for the necessities of life. On the contrary, the chain stores had indeed served “as a check on the drying up of towns and small cities” (Godfrey’s words) because according to Sams, “(they) have brought  to these small centers the same values, the same crisp new styles, and the same modern stores that were available in the bigger cities. And the customers know it.” As it turned out, the arguments put forth by Sams and others did much to swing public opinion to the chains’ side. On June 17, 1940, Patman’s “chain store death sentence” bill “suffered the death sentence itself”, Godfrey wrote, when it was killed in committee, never to reach the House floor for a vote.

While J.C. Penney was known (and would continue to be for some time) as a “small town chain” despite its impressive sales and burgeoning store count, there were a growing number of exceptions to the “small town” aspect. In 1931, the company opened its largest store to date in Seattle, a new building on the former site of the Bon Marché flagship department store. (Some years later, Penney’s San Francisco unit would claim the distinction of largest store.) Around this time Penney opened other large stores in key Western cities, including Oakland, Ogden (Utah), Salt Lake City and Reno, all of which “(did) a large volume of business”, as the New York Times put it at the time.

From the mid-30’s to the mid-50’s Penney sales volume, from stores large and small, ballooned from $225 million to over $1.3 billion. An interesting side note, related in a September 1950 Fortune magazine article entitled “Penney’s, King of the Soft Goods”, was the way Penney store managers shared in the company’s good fortune, no pun intended. (Granted, they shouldered a great deal of responsibility, including all hiring, training, advertising decisions and ordering of all products stocked – no merchandise was “pushed” on a Penney store by the home office in those days.) The rewards were substantial, however - “A good manager in a fairly large store can make fancy money” (“fancy” meaning 1/3 of the store’s after-tax net –yikes!), the article said, citing the example of the aforementioned Seattle store’s manager who pulled $125,000 in one year. The plan was later modified to allow assistant managers and other key employees to share in the pie. Still, a good many managers earned $30 to 50,000 a year, and nearly a third (of then 1,600 store managers) raked in at least $15,000 annually – fancy money indeed when nice houses could be had in most corners of America for well below ten grand. 

By 1950 J.C. Penney was a solid third place in America’s department store sweepstakes, behind the mighty Sears, Roebuck & Co. and the faltering yet still formidable Montgomery Ward. One of the keys to continued growth, the Fortune magazine article surmised, was increased presence in the Eastern half of the country. Up to that time, Penney was still thought of as a Western retailer (with “a Penney store in practically town above 5,000 and many smaller ones”) despite recent inroads into some key Eastern and Midwestern markets. “In the East, nobody knows a damn thing about the Penney Co.”, one manager was quoted as saying.  To be sure, building up the Penney reputation to the same level it enjoyed in the West would take time, with rough going in a number of markets. In Camden, New Jersey for example, Penney went head-to-head with Gimbels, Strawbridge & Clothier and Lit Brothers, “(whose) heavy advertising pull(ed) customers away from Penney’s, not toward it”. And in Cincinnati, where Penney opened a stunning new store in 1948, fierce competition from Shillito’s and others kept the store in the red for nearly two years after opening, a most unusual occurrence for Penney.

Over time, Eastern Penney store managers, many of whom started with the company in its native West, would adapt to the unique needs of their new markets.  The article cites the Camden store manager, for example, who began with Penney in Spokane, Washington, transferring to Milwaukee then to Quincy, Illinois before landing at the helm in Camden, a market where a constant barrage of advertising was necessary to drive sales, a situation he hadn’t experienced in his earlier tours of duty.

The manager of the Springfield, Massachusetts unit worked in Penney’s San Francisco flagship store, moving to Santa Barbara before traversing the country to run the Springfield store. New England customers, as a rule, were very different from those in California. “In buying curtains a California customer wants to know first how wide the ruffle is, how full it is, and what the colors are; the Springfield customer asks whether the organdy (a type of fabric often used in curtains) is permanently finished, how securely the ruffles are sewed on and how long it will last”. Another cited example concerned towels, then as now one of Penney’s strongest product lines. Whereas bath towels typically outsold face towels 2 to 1 “presumably because a bath towel can serve either purpose”, in the Springfield store the opposite was true. The manager was undecided as to “whether the frugal New Englanders use face towels after they bathe, or whether they are just trying out Penney face towels before shooting the moon and buying the larger size.” (They also tended to say “ayuh” when responding affirmatively to questions, a point the article curiously omits.)

In any event, Americans were buying more face towels, bath towels, washcloths and all manner of other linens from their local J.C. Penney store than anywhere else, in addition to clothes for the whole family. “King of the Soft Goods”, indeed, but big changes lie ahead.

The first four photos above appear by courtesy of the J.C. Penney Archives at the DeGolyer Library at Southern Methodist University, the last is from an original slide in my collection. From the 1950’s, the following locations are depicted: Stockton, Long Beach and Glendale, California, followed by Rockwood, Tennessee (apparently a much older store, refaced) and Albuquerque, New Mexico, with a very nice hat tip to the area’s traditional adobe architecture. Note the gas stations represented in the picture – a Phillips 66 sign right next door, with a Conoco station across the street from it. Across the street from the Penney store itself, reflected in the store windows, is what appears to be a “Teague” Texaco. If you have a free week this summer, you can read about those and more here.      

Mr. Penney, Mountains & Main Street

The pages of retail history are filled with the names of companies that no longer exist. Many of them were the picture of success for decades on end. They were leaders in their field - patronized, respected and loved by millions of customers. Household names. For one reason or another, these companies failed to adapt to conditions, and consequently they’re gone – sold out to a competitor, or just shuttered altogether.

It can be said that “adapting to conditions” is the one thing at which the 109-year-old J.C. Penney Company has excelled at above all else through the years. Rarely at the cutting edge of fashion – or anything else, for that matter, “the Penney Company”, as its founder always referred to it, has nonetheless continually managed to stay in step with the times, reinventing itself periodically to appeal to ever-evolving American shopping tastes. In the process they’ve amassed a track record that, despite occasional missteps, other retailers could aspire to only in their dreams.

In the mining town of Kemmerer, Wyoming in 1902, conditions were hard. Mr. Penney, in a letter to E.C. Sams, who would turn out be his most significant hire, described it as “a barren country, very little vegetation, and unless a man and his wife as well are strictly business, they might not like it.” The nearest water source, for example, was from a creek a half mile away from town. And for three months out of the year, the average low temperature was 6 degrees Fahrenheit or below. (“Might not make it” was probably more accurate.) Such was the unlikely setting for the birth of a retailing legend.

James Cash Penney (yes, that was his real middle name, he would assert on innumerable occasions) was born on September 16, 1875 in Hamilton, Missouri, a rural town some 65 miles northeast of Kansas City. Penney’s parents, in particular his father, a farmer and unpaid Baptist minister, instilled in him a strong sense of faith, hard work and ethics.

An early lesson in ethics came in his teens, when he was given a small parcel of the family land to raise watermelons. When the local county fair rolled around, Penney loaded up a wagonful of melons, parking just outside the fair’s gates where he began to do a “brisk business”, according to authors Tom Mahoney and Leonard Sloane in their book The Great Merchants. The elder Penney was not pleased when he discovered this, admonishing the young man for competing with the fair merchants “without paying for the privilege”. He ordered his son to take the wagon home, despite “Young Jim’s” technicality defense that he was actually selling outside the gates, albeit by only a few feet. It was a lesson Penney “never forgot”, the authors state.

Although he would maintain a lifelong interest in agriculture, Penney’s destiny lay elsewhere. “I am not cut out to be a farmer”, he told his father in a deathbed conversation related in the 1947 history of Penneys by Norman Beasley entitled Main Street Merchant, “I want to be a storekeeper”. In early 1895, at the age of 19, Penney was given his first job in retail as a junior clerk at J.M. Hale & Brother, a well-known local store in Hamilton. Penney was an eager pupil, and with Mr. Hale as “professor”, he learned the myriad aspects of store operations, from serving customers, to stocking, to sweeping the sidewalks out front. He drove himself extremely hard, earning promotions along the way, and over two years his salary increased from an initial $2.27 per month to $25 a month. But he nearly wrecked his health in the process. Things became so bad midway through his third year there that Penney’s doctor told him he was a prime candidate for “consumption” (an age-old synonym for tuberculosis) and that he needed to “get out of this Missouri climate” and move to Denver “right away.”

“Go West, young man, go West. There is health in the country, and room away from our crowds of idlers and imbeciles” is a phrase widely attributed to Horace Greeley, a famous 19th century newspaper editor and politician. Penney took his doctor’s (and Greeley’s) advice and boarded a train for Denver in June, 1897. To be sure, his health improved, but he did run into his fair share of “idlers and imbeciles” in his early work experiences there. Taking a job at the Joslin Dry Goods Company, the 5’8”, 135-pound Penney was subjected to endless hazing by the other clerks, so he left as soon as he could line up another job. A stint with a second area retailer came to an abrupt end when Penney discovered the store owner’s dishonest pricing practices. Disgusted, Penney demanded his earned wages on the spot and resigned.

Penney’s search for new employment led him 40 miles north to Longmont, Colorado, in the heart of cattle country, where a butcher shop was for sale. Penney decided he liked the town, and had his mother send him his savings of $300, enough to buy the shop and keep the butcher on the payroll. As it turned out, this particular butcher shop was heavily dependent on the business of one hotel, whose cook expected a bottle of whiskey each week on the side as a requirement for trade. (In researching this, I learned that most of Longmont’s early settlers came from Chicago. That explains that.) Penney complied for one week, and then refused to buy the cook off thereafter as a matter of conscience. So went the hotel’s business, and not long afterward, the butcher shop itself.

Eager to resume his career as a “dry goods man” after the butcher shop debacle, Penney applied for a job at a local store owned by T.M. Callahan, a dry goods and clothing operation similar to Hale’s, where Penney had worked back in his hometown. Callahan didn’t have any regular positions available, but informed Penney that he could fill in for one of his clerks who was ill and not likely to get back to work over the holidays – “so if you want to come in until he does come back,” he was quoted in Beasley’s Main Street Merchant, “I can put you on.” (And there you have it, dear readers - one of retailing’s towering figures started out as a “holiday temp”!)

Instead of letting him go upon the regular clerk’s return to work, Callahan, who was most impressed with Penney’s intuition and work ethic, made him an offer. Callahan’s business partner, Guy Johnson, whom he had set up with a dry goods store some 400 miles east in Evanston, Wyoming, needed some help. To help convince Penney to go for it, Callahan laid out his master plan to open a number of stores throughout Colorado and Wyoming, “the first time Penney had ever heard of chain stores”, Beasley states in his book. Penney eagerly accepted the challenge.

Not long afterward, Johnson offered Penney a partnership stake in a new store he and Callahan planned to open in Ogden, Utah, a town that at 35,000 in population was much larger than anyplace they’d opened their doors before. Upon making a visit to Ogden, Penney decided the city was “too big”, and while he liked the partnership idea, he preferred to operate in a smaller town. He expressed a desire to go to Diamondville, a ranching and mining town not far from Evanston. He liked the people he’d dealt with from there. Callahan suggested Kemmerer, Wyoming as an alternative, a “lively little (mining town)… between Diamondville and Frontier.” Penney agreed to move to Kemmerer, sight unseen. When Callahan and Johnson offered to finance Penney’s $1,500 stake at 8 percent interest, Penney opted to go with a bank in his hometown of Hamilton, Missouri instead, which had offered 6 percent terms, an early indicator of Penney’s independence and shrewdness.

In addition to the rustic conditions cited earlier, there was another major challenge facing anyone who cared to open up a “cash-only” store (which would be Penney’s rock-solid policy for more than 50 years) in a mining town like Kemmerer. There was very little cash in the town. Beasley quotes a banker describing the grim circumstance to Penney upon his arrival there: “Most of our people are miners. They are paid once a month. Most of them are clean out of money before the month is half over, and some of them seldom see any money.” In those days, mining companies often paid their workers in “scrip”, a form of coupon, in lieu of cash, and many goods were purchased at the mine-owned “company store” at unconscionable markups. The line in the song “Sixteen Tons”, a monster hit for Tennessee Ernie Ford in 1955, rang true for many mine workers in the early 20th century – “I owe my soul to the company store”. But rather than accept scrip, as other merchants (and saloons) in town did, Penney pressed on with his plans to open on a cash-only basis.

On Monday, April 14, 1902, the firm of Johnson, Callahan and Penney opened their first “Golden Rule Store” in Kemmerer, a one room building of wood-frame construction with “an attic, with the joists and rafters standing exposed”. In the days preceding the store’s opening, Penney had mailed out announcement fliers to 500 local mining families, and just before the store’s opening day, handbills – with a list of items for sale and their cash prices – were passed out on the streets of the town. The first business day, which didn’t end until nearly midnight, netted sales of $466.29.

Penney “considered it a sin if anyone came into the store without being waited on”, Beasley wrote, “(and) a greater sin if anyone went our without making a purchase”, so he and his wife Berta worked fastidiously, and demanded the same of their hired help. Another requirement, rooted in Penney’s religious upbringing, was that employees neither drank nor smoked. The first year’s results were far beyond any reasonable expectation, with total sales of $28,898.11 at a nice profit. Penney was able to pay off his loan and now owned his share of the store outright.

So impressed was Callahan with Penney’s performance in Kemmerer that he offered him complete rein over a fifty-store chain he was planning. Penney turned the offer down, though, citing he “was not ready for the responsibility.” Not yet, at least. The prospect soon took root in his thinking, however, and the idea of maybe three or four or six stores across “these mountain states” began to appeal to him, even though it would be “shooting at the moon”, as Penney said to his wife. She convinced him he was up to the task. Before long, Penney acquired partnership interests with Callahan and Johnson in two more stores, in Rock Springs (where he took over from a failing manager) and in Cumberland, Wyoming, a new venture.

In 1907, to Penney’s surprise, his partners informed him of their desire to sell out their shares in the three stores they co-owned with him. The agreed-upon price was $30,000, in a one-year note at 8 percent interest and Penney’s signature as the only security. Now he was on his own. Wisely, he chose not to stay that way for long.

Penney sought to emulate Callahan and Johnson’s “partnership” approach, where clerks were groomed for management and an eventual ownership stake in a store, but he would exercise more care in determining just who would be selected for these opportunities and when the time was right. “He felt…that the worst thing that could happen was to promote men before they were ready; when this was done, it meant defeat for both the giver and the receiver”, Beasley states.

Surprisingly, the man who would ultimately be the most important partner of Penney’s entire career showed up that same year, 1907. Earl Corder Sams was an ambitious 23–year old native of Simpson, Kansas. Having tried his hand at several trades and discovering he liked storekeeping the best, he engaged an employment agency to boost his prospects of finding a “dry goods” opening in the west, where he sought to make his future. The ensuing string of mail correspondence from Penney to Sams is presented in great detail in both the Main Street Merchant book and in Penney’s autobiography entitled Fifty Years with the Golden Rule, and makes for intriguing reading. In the typical ever-so-polite style of early 20th century correspondence, Penney expounds at length on his highly demanding requirements for the position, while cautioning Sams in detail about the pitfalls of merchant life on the frontier. You’d think he was interviewing for the most important position in the world. To Penney, it was. Sams made the trip to Kemmerer and then returned home, job offer accepted. After a month he returned, family and possessions in tow. Sams did so well as a clerk at Kemmerer that within months Penney put him in charge of the Cumberland store. A year later, Penney offered him part ownership in a new store in Eureka, Utah.

Penney continued to refine his partnership idea, devising a system whereby a successful store manager who had saved his money could buy a one-third stake in a new store, “provided he had trained a new man capable of opening and managing the new link in the chain.” Thus every “new man” sent out to open a store had been fully mentored as a chief clerk in his previous store, and would be able to buy an ownership stake in his next one. This was Penney’s vision for the growth of his company, and over time he gained the nickname “the man with a thousand partners.”

And he wasted no time in carrying that vision out. Penney, who just a few years before considered fifty stores a daunting number, began to set his sights far beyond that. By 1908 there were 4 total stores, two years later there were 14, and two years after that, 1912, there were 34, including locations in Wyoming, Utah, Idaho, Colorado, Nevada, Montana, Washington and Oregon. By this time, Penney himself had relocated to Salt Lake City, where he set up a central buying office and warehouse for the company.

But amidst all of this came a personal tragedy, when Penney’s beloved wife, who was in no small part responsible for his success, passed away suddenly just prior to a planned European vacation trip. He “plunged himself into work, open(ing) stores in rapid succession”, Beasley wrote, and took an extended buying trip to New York. Instead of returning to Salt Lake City afterwards he sailed for Europe, alone.

Upon his return, Penney dealt with some pressing issues facing the business. One was a need to revisit the name of his stores as the chain rapidly grew. Unfortunately, the name “Golden Rule Stores” was not at all unique to Penney’s organization. His former partners, Johnson and Callahan, were still using it on a number of stores they owned (separately, as the partnership between those two men had since been dissolved), and a host of other unrelated stores in the West used the moniker as well. On top of that, the use of the name “Golden Rule”, based on the Biblical principle “Do unto others as you would have them do unto you”, was considered suspect by many customers who feared that less-than-scrupulous operations were using the name as a cover for shoddy (and shady) business practices. Penney decided to replace the Golden Rule name with his own.

A major dilemma was the need for increased financing to handle expansion. Penney “had reached the limit of his personal borrowing (ability)”, Beasley wrote, and now the only real option was to incorporate and sell stock. This forced a change to the partnership structure as Penney originally conceived it, where the partners’ ownership stakes in the stores were converted to preferred stock in the new “J.C. Penney Stores Company”, a Utah corporation, incorporated on January 17, 1913.

Soon afterward, Penney began the long process of moving the nerve center of the company to New York City, starting with a central buying office there. The move was initially met with protest by many of Penney’s partners, virtually all of whom were “small-town Westerners (who) knew the ways of the West” and “wanted no part of New York.” (I’m picturing those old Pace picante sauce commercials, but I’m sure it was more dignified than that. Dub Taylor would have made a good storekeeper, though!) The fact was that most of the partners were resistant to the idea of any centralized buying office, which in part spurred Penney’s decision to close the Salt Lake City buying operation not long after it opened. (Penney blamed himself for the failure, for bringing in an outside person to run it instead of one of their own.) Even Sams was skeptical of the idea at first, but Penney’s logic was rock solid – at the time, a huge percentage of clothing and other “soft goods” was designed and manufactured in New York’s storied “Garment District”, a roughly 40-block area of Manhattan. Penney, who for all his gifts as a developer of management talent was also a consummately skilled buyer, saw the advantages of being close to the action.

The ethical aspects of business were always topmost in Penney’s mind, and in 1914 he authored a famous document which would become known as “The Original Body of Doctrine” (later “The Penney Principles”) that has been quoted multitudes of times over the years in nearly every forum imaginable. They were: “1.) To serve the public, as nearly as we can, to its complete satisfaction. 2.) To offer the best possible dollar’s worth of quality and value. 3.) To strive constantly for a high level of intelligent and helpful service. 4.) To charge a fair profit for what we offer – and not all the traffic will bear. 5.) To apply this test to everything we do: ‘Does it square with what is right and just?’” Timeless principles from a “mission statement” issued nearly a century ago, long before they became obligatory.

At the end of 1916, Penney stepped down as president of his namesake company, turning the operation over to the very capable hands of E.C. Sams, while Penney assumed the title of chairman. Penney chose instead to concentrate on leadership development and philanthropy, and years later in his eighties and nineties was the smiling, grandfatherly public face of the organization. With the exception of a very brief period following Sams’ sudden passing in 1950, however, Penney would never really run the company again, although his input was sought in major decisions and he remained the subject of great affection and respect.

The 1920’s saw some key acquisitions for the J.C. Penney Company, but one stood out as most significant, if only for sentimental reasons. In 1923, Penney got wind that J.M. Hale, the owner of the store where Penney started out in his hometown of Hamilton, Missouri, was planning to retire and sell his business. A delighted Penney bought out his former boss (years earlier he had privately decided not to open a store in Hamilton until such time as Hale was ready to sell), and the reopening of the Hamilton store as a J.C. Penney unit was symbolically timed to make it the 500th in the chain. When the location was closed years later in 1981, the story made the New York Times.

In the next few years, two more old friends sold out to Penney as well. Tom Callahan had continued to operate 12 stores, years after he, Guy Johnson and Penney split up their three-store partnership, and in 1926 he sold those stores to Penney. Johnson had remained in the dry goods business as well, with 20 stores of his own which he sold to Penney two years later. True to form, the company paid cash in both deals, which put the chain at nearly 750 total stores.

The company had grown to a point where it was time to make some major changes to its structure. Penney’s “manager/partner” concept had led to a somewhat haphazard growth pattern with “scarcely little central planning”, as Beasley put it. And while allowing a manager to open a new store provided a good opportunity, it was also a burden that took time away from the needs of the store he was actually running. To replace a manager’s lost income potential from opening new stores, Penney instituted a plan which “guaranteed by contract a share of the net profits of the store he managed,” (One-third of the store’s after-tax net, according to a 1950 Fortune magazine article. I’ll put the Kleenex away now.), and the manager could fully concentrate on operating his store. Market planning, store locations and real estate deals would now be handled by centralized departments. With these changes made, the stage was set for even faster growth and the establishment of Penney as a truly “national” company. At the end of 1928, with over 1,000 stores and $176 million in annual sales, the company’s renown was rapidly spreading beyond its still primarily Western base.

Among the J.C. Penney Company’s growing legion of admirers were some of the top retailers of the day. Over a lunch meeting with Mr. Penney near his New York offices late in 1928, a prominent Chicago businessman floated the idea that Penney should consider a merger with Montgomery Ward & Company, America’s second largest mail order firm, which was just starting to open retail stores of its own. The would-be matchmaker was Marshall Field III, scion of the legendary Chicago retailing family and president of the company that bore his name. The idea piqued Penney’s interest, and that very afternoon he called a meeting of his board of directors, and within days Ward president George B. Everett traveled to New York to meet with E.C. Sams and other Penney executives to discuss a possible merger.

Unclear after the meeting as to what Ward’s intentions were, Sams wrote Mr. Everitt to see whether he thought Montgomery Ward & Company should acquire Penney, or the other way around. Were Penney to be the suitor, they would need to ascertain the value of three key aspects: Ward’s corporate goodwill, their “organization and experience in buying and distributing lines of merchandise” that Penney didn’t handle, and the mail order operation, Ward’s greatest asset and a business with which Penney had no experience whatsoever. Everitt, in response, assured Sams that his company wasn’t for sale nor did he presume that J.C. Penney was. Any combination of the two companies would be a merger of equals that would form a completely new company. Committees were put together on both sides and much correspondence ensued, but the idea was soon dropped.

No sooner had the talks with Montgomery Ward ended that another overture came Penney’s way, once again from Chicago. General Robert E. Wood, president of Sears, Roebuck & Company, wrote a letter to Sams. Sears was underway with a rapidly-growing program to open retail stores as an adjunct to its massive catalog business, and Wood wanted to gauge Penney’s interest in a possible merger, as Penney’s store network was already sizable and becoming more well-developed by the month. The idea was too intriguing not to consider, and plans were laid for Sams to meet with “The General” in his Chicago offices. Wood proposed an idea (that Sears would ultimately adopt for itself in modified form) that the combined business “would have three segments: ‘a mail-order division; an A store division, which would include stores in the large cities; and a B store division, which would include stores in the smaller cities and towns.’” Under this arrangement, “Sears-trained executives” would continue to run the catalog business, while the “B” stores would be under the control of “Penney-trained merchants”. The larger “A” stores would presumably be run on a consortium basis, although some of Penney’s big-city units were impressive in scale by that time. Buying responsibilities would be split along advantageous lines, with Sears’ buyers continuing to handle hard goods, including appliances, farm equipment and automotive, while all apparel lines and other soft goods would become the responsibility of Penney people.

The merger would provide some advantages based on sheer size – the possibility of having the “dominating store” in town, the ability to split the country up into manageable districts “such as A&P and Woolworth now provide” and the ability to “attract outstanding personnel”. The talks heated up to the point to where the New York Times pulled the trigger on the story – “Penney Chain To Go To Sears-Roebuck”, the headline read in a December 3, 1929 article, based on “circumstantial” confirmation (insert choice remark here) by Sears Chairman Julius Rosenwald, who deferred to Wood on the details. (Rosenwald was Sears’ chairman, but Wood unequivocally ran the company.). Ultimately, Sams and the other Penney execs decided against it, out of concern that “our younger executives would have lessened rather than greater opportunities” in a situation where Sears would have clearly been the dominant entity. Beyond that, at the time Penney simply didn’t have the management manpower the deal would have required.

“The Penney Company” would go it alone, in a decision that was made for practical considerations. In light of history, of course, it turned out to be incredibly wise.

Shown above are various Penney stores from the 1920’s and 30’s, although some of the photos themselves postdate that era. Top to bottom, first up is the massive Oakland, California location, then a 1930’s Inglewood, California store followed by the small 1920’s store it replaced, a 1950’s view of a much older store in Cortland, New York (check out the shining details on that great porcelain sign), and a can’t miss “white goods sale” in Pasadena, California, with fine Spanish style architecture. These photos appear here courtesy of the J.C. Penney Archives at the DeGolyer Library at Southern Methodist University. My very special thanks to Joan Gosnell, archivist extraordinaire, for her extensive help and her sense of humor.

Pictured below is James Cash Penney’s second store in Kemmerer, in what is probably the earliest known photo of a Penney store. (Engravings and paintings of the first store exist, but no photos to my knowledge.) Something tells me the establishment next door was much more “saloon” than “opera house”.

A&P in The Big Easy!

If any grocery store could lay claim to the term “landmark”, the one pictured above would certainly qualify. It’s the legendary A&P at the corner of Royal and St. Peter streets in the “Vieux Carré” (known to most of us as the French Quarter) section of New Orleans. Untold numbers of shoppers – locals and tourists alike – have filed past that red marble corner column through the decades.

The store opened on December 20, 1930, and remained open as an A&P for a remarkable 77 years thereafter, until the company sold off its 21-store New Orleans operation in September 2007. Happily, it continues on as a grocery store, part of the locally-owned Rouse’s chain.

It’s almost beside the point to discuss the store’s architecture. From the start, it has blended in seamlessly with the other French Creole-styled buildings (and their intricate balcony ironwork) that predominate the French Quarter. This photograph was taken around 1970, near the midpoint of the store’s existence as an A&P, and shows a much lighter color scheme than many would remember. More familiar are the darker walls and black-painted ironwork the store has sported in recent years. Its undeniably charming appearance has made the store a very popular artist’s motif.

Recently, a commenter on this site likened the Royal St. A&P to a convenience store, and I agree with that description. Because of the store’s urban location and small size, it filled a different role than the typical late-20th century A&P supermarket. Indeed, whenever A&P ran a larger promotion or giveaway in the New Orleans market, they frequently included the disclaimer “all stores except 701 Royal St.”, presumably due to a combination of the lack of space and the higher selling prices attainable in that vibrant tourist district.

Below is a full page Times-Picayune ad from the Royal St. store’s opening day, which merited a fairly cursory mention in the lower left corner of the page. Also of note is A&P’s defense of its area bread pricing, an early skirmish in A&P’s long conflict with the antitrust regulators. Oh, and 8 foot tall Christmas trees for 89 cents!

One last item - since we’re on the subject of A&P in New Orleans, here’s another area store of more modern design, shown shortly after its opening in another A&P publicity shot, from 1968. Featuring a nice contemporary look, this store was highlighted in the 1970 A&P Study by Progressive Grocer magazine.

Note: Thanks to Scott for pointing out an error and supplying some additional information regarding the location of the store pictured below. This store is actually in New Orleans' Garden District, not the French Quarter as previously stated, and still stands at 3233 Magazine Street. The store is now a Breaux Mart, another locally owned chain. Rouse's, who bought most of A&P's area stores, passed on this one owing to its small size.

C'est tout!

Putting the "Pacific" in "A&P"

On May 2, 1930, A&P opened nine stores in the greater Los Angeles area, their first units on the West Coast. Seventy years after the company’s founding, the famous name – The Great Atlantic & Pacific Tea Company – became a statement of fact, and of the long-awaited realization of a dream.

An article in the previous day’s Los Angeles Times quoted A&P president John Hartford, who had traveled across the continent for the landmark occasion: “These nine stores represent only an opening wedge…of an expansion program which will take in the entire Pacific Coast and Rocky Mountain territory.” He mentioned that leases for thirty additional Los Angeles-area stores had already been signed. The original nine store locations were as follows: 6811 South Western Avenue, L.A., 5859 Franklin Avenue, L.A., 31 Pier Avenue, Hermosa Beach, 37 North Fair Oaks Avenue, Pasadena, 136 San Fernando Avenue, Burbank, 1515 Mission Street, South Pasadena, 211 East Main Street, Alhambra, 6265 Van Nuys Boulevard, Van Nuys (Usually pronounced as a single word – “vaneyes”. You’re welcome.), and 106 North Pacific Avenue, Redondo Beach.

A year later, the company opened its first stores in the Seattle area. They took things a bit slower here where the pace of store openings was concerned, but over time A&P would develop a respectable presence in the market. It would prove to be the company’s only other significant entry in the Western states.

The designs of the Los Angeles-area stores in particular were very appealing, with some of the finest area examples of Spanish and Art Deco retail architecture rising up under the A&P banner. Many of the early stores featured open fronts in a nod to the region’s ideal climate – no storefront windows or doors (“open front” meant exactly that), allowing plenty of room to extend display bins onto the sidewalk to attract shoppers. After hours, these stores were secured by sliding doors or folding scissor gates like the kind used by indoor mall stores today. Local competitor Vons was a major proponent of the open front design, as was Lucky Stores “up north”, to name just a couple.

Probably the most notable individual store in A&P’s western roster was the Westwood Village “super-store” opened in 1936. The store was designed by renowned California architect Allen Siple, who at that time was under contract to the Janss Investment Corporation, developers of the legendary Westwood Village commercial center that borders the UCLA campus. The exterior design is in the Janss Brothers’ mandated “Mediterranean” style, as were the other 1930’s Westwood landmarks, including the domed Bank of America building, the Fox Westwood Village theatre and the famous Sears store, among many others. Whether the style bore any resemblance to genuine Mediterranean architecture is a matter of somewhat snarky debate even all these years later, but it looked great in my opinion. The most striking feature of the A&P store, and for that matter the other Westwood buildings mentioned, was its tall, spire-like tower, where in this case the red neon-outlined “A&P” lettering was visible for a great distance at night. The store was torn down in the late 60’s to make room for another theatre.

By 1935, only five years after the first stores opened, there were over 100 A&P stores in the L.A. area. As the company gradually shifted its store mix to supermarkets in the late 1930’s, this number began to decline, leaving the company with roughly 50 area stores by 1950. This phenomenon was by no means unique to A&P - nearly all major grocery chains experienced decreased store counts in the 40’s and early 50’s as they replaced two to three small stores at a whack with one (much larger) supermarket. There was one problem in this case, though – the Los Angeles area was positively exploding in population in the postwar era. A massive population shift was underway. People were moving to Southern California in droves from the Eastern and Midwest areas, in quest of the warmer climate and boundless opportunity the area had to offer. As time passed, A&P appeared more and more to be in retrenchment, or at least at a standstill.

To be sure, the area’s supermarket scene was brutally competitive, with a number of locally-based competitors boasting loyal followings – Ralphs, Alpha Beta and Vons among the strongest of these, with Hughes, Market Basket, Boys Market, Fox, Mayfair, Stater Bros., the Fitzsimmons/Roberts/Thriftimart stores and others I’ve surely forgotten to mention commanding their pieces of the pie as well. The competition grew even more intense when two Northern California-based competitors ramped up their “Southland” operations – Safeway, always a factor, but a major push into SoCal beginning in the late 50’s would transform them into a huge player there, and Lucky Stores, Inc., who in 1963 established a large office/distribution complex in Buena Park to support what proved to be very rapid growth.

It was a battle waged on many fronts – price, advertising (especially on television – these were the wild and woolly days of live remote commercials and crazy promotions), store location, and, fortunately for us – architecture. The store designs of Southern California supermarkets – especially from the golden age (I guess I would call the 1930’s Spanish and Art Deco designs the “platinum age”) of the mid-1950’s to the mid 60’s – represent the pinnacle of the form, with a number of stores standing out as prime examples of Mid-Century Modern architecture.

In this one respect, A&P made a bold last stand. At the start of the 1960’s they opened several new stores (mostly replacement units) in major suburban L.A. markets with fresh, contemporary architecture, representing a major departure for the conservative and tradition-bound “Grandma”, as the company was fondly nicknamed. At the same time A&P was beginning to blanket the eastern half of the country with its Centennial stores, their new SoCal units sported gigantic neon signs, ranch-like stonework and bold colors, a fine fit for the area’s unique vibe. There would be no colonial-themed stuff there.

Groceteria has an astounding set of color photos of some of these stores, taken at the time of their grand openings. These photos prove that (architecturally, at least) A&P could definitely cut the mustard. Beyond the excellence of the store designs, two aspects of those photos jump out at me – first, the presence of the Van DeKamp’s windmill signs on the storefronts. Interestingly, A&P promoted the local bakery favorite over their own Jane Parker brand, a major reversal of their normal policy. Secondly, the “Blue Chip Stamps” banners, meaning that A&P opted to join the Blue Chip trading stamp consortium (an intriguing mini-soap opera in itself - hope to discuss it here someday) instead of offering Plaid stamps as they did in other regions. Both decisions appear to have been a nod to local preferences.

The 1960’s would prove to be a very difficult period for A&P – in 1964, the company lost its status as America’s largest retailer to Sears, but that was merely a hint of much deeper problems. There were many reasons behind their dilemma, which I won’t go into detail about now, but chief among them were an inexplicable slowness to open stores in the booming suburbs, and an overemphasis on their own store brands, causing them to lose out on the national brand marketing bonanza (with millions of dollars in network television advertising support that A&P appeared not to care about) of the 1960’s.

The crux of the matter, as far as the West was concerned, was that A&P never seemed to make a real commitment to the area. It was most telling that the company had never even set up a separate western division. There were seven A&P retail divisions in 1960 – New England, Eastern, Atlantic, Southern, Central, Middle Western and Central Western. The Los Angeles and Seattle markets were in the….uh, Eastern division. Along with such sunny-climed areas as the Bronx, Brooklyn, Garden City (Long Island), Newark and Paterson, New Jersey, all monster markets for A&P. Suffice it to say that two small groups of stores, 2800 miles away from home base, would have received precious little attention.

None of this was lost on the competition, and it was obvious that A&P wasn’t exactly striking fear into their hearts. As Robert Magowan, the ever-unflappable chairman of Safeway, told Time magazine in a 1965 article, unflatteringly titled “Weak Tea” - “I doubt that A&P will come West in any force until it shores up some of its weak spots. And then I still doubt it.” The (somewhat more flappable) A&P brass had acknowledged this for a while by then. As far back as 1959, A&P president Ralph Burger told an Associated Press interviewer when asked about expansion in the west – “A&P originated in the east and its development has naturally been limited principally to that section of the country…There are no plans for major expansion in the west at this time”. Six years later, the consequences of that course of action appeared to weigh on then-A&P president Byron Jay, as he told Time – “We may have made a mistake in the West.”

It came to an end for A&P in Los Angeles in December 1968 with the announcement that the company would sell its 31 area stores to the E.F. MacDonald Company. MacDonald was the owner of Plaid Stamps, A&P’s trading stamp of choice in all but the L.A. market, an irony already mentioned above. The previous year, MacDonald became a supermarket operator itself when it purchased 40 Shopping Bag stores from Vons Grocery Company, who was forced to sell them as a condition of an FTC antitrust order. The A&P stores would be rebranded as Shopping Bag stores. In the early 70’s, MacDonald sold the chain to Cleveland-based Fisher Foods, Inc., whereupon they reopened as Fazio’s units, as previously discussed here.

In 1974, A&P sold off its Seattle area stores, which Retired A&P Executive/Biographer William Walsh had termed a “more successful operation” in his fascinating book The Rise and Decline of The Great Atlantic and Pacific Tea Company. Some of the stores went to Smith’s Food King, which was later acquired by Fred Meyer and then by Kroger.

Anyone vaguely familiar with the A&P story is probably well aware that the sun has set on a large part of the A&P Empire in the last few decades. 150 years after its founding, though, the proud name still exists, on more than a few stores. Not many can say that.

The first two photos below are shown here by permission of the USC Libraries Special Collections, California Historical Society Collection. The first shows a magnificent streamlined/deco A&P and Thrifty Drug combination, located at the intersection of Sunset Boulevard and Fairfax Avenue circa late 1930’s. Next, from around the same time, is a very different but equally nice Spanish style A&P, location unknown. Note the men in tuxedos stationed in front. Both appear to be “open front” type stores. The next five photos are from Chain Store Age, circa 1937, and show the Westwood Village store (corner of Gayley and Broxton), exterior and interior views of the A&P “Food Palace” at the corner of Wilshire Boulevard and Cochran Avenue, and similar views of the South Pasadena A&P store. After that is a brief hat tip to the Seattle area, with a 1959 A&P publicity photo showing the Bremerton, Washington store. The metal sign to the far left is a variety I’ve only seen on Seattle area A&P stores. Last, from the Los Angeles Public Library, is the Pasadena store, located at East Foothill and Rosemead Boulevards, as final preparations were underway for its April 1959 grand opening.

Below are two full-page ads from that grand, glorious era when new supermarkets rated an entire newspaper section (in the Los Angeles Times, no less!). The first is from the 1935 opening of the Wilshire Blvd. “Food Palace”, the second from 1950, marking new stores in Santa Monica, Escondido and Altadena. The ad provides a comprehensive listing of Southern California A&P stores as of that date.

A&P Goes to War!

Probably not the war you’re thinking of, although World War II fits in at roughly this point in the timeline. No, this was a war of A&P’s own – one that started earlier and ended much later.

As far back as the mid-1920’s, there were grumblings about the growing power of “the chain stores”. Most of this concern, understandably, was on the part of independent grocers, who by the mid-1930’s were looking at a full third of their potential market going to one competitor – A&P. Predictably, it wasn’t long before politicians on a variety of levels took notice. As a result, throughout the 1930’s, over half of the individual states passed laws regulating the operation and expansion of chains, and in nearly all cases a “chain store tax” was levied for good measure. By necessity, A&P took these as they came, complying quietly in nearly all cases.

As far as A&P’s business was concerned, they had weathered the Depression far better than most companies. Their aggressive pricing policies accounted for one reason, but another key factor was George L. Hartford’s insistence on short-term leases for all A&P stores. Very short term, in fact – the typical A&P store lease was for one year with nine one-year renewal options. In later decades this policy would come back to bite A&P in a big way, costing them many prime early shopping center locations, but the flexibility it gave the company to close or relocate unprofitable stores was an asset in the darkest days of the 1930’s.

Another development was the conversion to supermarkets. Faced with upstart competition from the likes of Michael Cullen, a former A&P employee who had started a chain of giant, self-service food stores called “King Kullen”, and others, it became evident to John Hartford that A&P would have to jump into the fray in order to remain competitive in their key New York/New Jersey markets and elsewhere. After considerable egging on by his brother, George Hartford, the conservative one who controlled the purse strings, agreed to a 100-store experiment with the newfangled supermarkets in 1936. Success soon caused the experimental number to be upped to 300. Before long, the “experimental” designation was dropped altogether, and supermarkets became the way forward for A&P.

In early 1938, according to the 1970 Progressive Grocer A&P Study, while supermarkets constituted just 5 percent of their store base at that point, they were contributing 23 percent of sales and nearly half of the company’s profits. As author William I. Walsh points out in his history of the company, “The Rise and Decline of the Great Atlantic and Pacific Tea Company”, although A&P didn’t come up with the supermarket idea, the fact that the company opened the first supermarkets to be seen in many locales often led people to credit A&P with the concept.

Further adding to the excitement, A&P decided to enter the publishing business. For some years the company regularly issued an illustrated giveaway recipe booklet, called simply “Menus”, but would now introduce a full-fledged women’s magazine, to be entitled Woman’s Day. The decision was spurred on in part by the success of another magazine, The Family Circle, which was then reaching nearly 1.5 million households through five major grocery chains, according to an October 1937 Time article. A&P’s new magazine would carry “menus and home hints”, but “no fiction or film gossip as does Family Circle”, according to Time. Twenty years later, A&P would sell the magazine off to an independent publisher, who made it available to all grocery outlets and other retailers. Of course, Woman’s Day and Family Circle remain staples of supermarket checkouts everywhere, alongside some distinguished longtime competitors and some shall we say “less uplifting” publications. (Personally, I miss the “Weekly World News”. You just can’t find solid news reporting anymore!)

On a more somber note, the “anti-chain store movement” was rapidly growing in intensity by the late 1930’s. By this time, the movement had an official face. Congressman Wright Patman, a firebrand who was aptly nicknamed “the fighting Democrat from Texas”, had taken the issue up as his personal crusade, and his sights were set directly on the good old A&P. In 1936, he had won passage of the Robinson-Patman Act, still a cornerstone of U.S. commercial policy today, which essentially prohibits manufacturers from selling the same item at different prices to different entities, in effect leveling the playing field for smaller retailers who are unable to purchase at the volume level of their larger competitors. (I’m massively oversimplifying this, for space reasons. And in the interest of keeping you awake.)

Two years later, Patman introduced a new bill to curb the influence and spread of chain stores, (accurately) nicknamed the “Death Sentence Bill”. The centerpiece of the bill was a national chain store tax of $1,000 per store, but “with a final clincher”, as the Progressive Grocer study put it – “the total tax would be multiplied by the number of states in which the chain operated”, a provision that would have meant utter devastation for A&P. The numbers in A&P’s case would have added up to a half a billion dollar tax for the company for 1937 – 60 percent of total sales and a mere 6,000 percent of profits. Bye, bye Tea Company, along with Safeway, Kroger, Woolworth and host of other household names. Even cooperative organizations such as IGA would have been under threat, according to the study. Fortunately, Patman’s bill never made it out of committee.

It wouldn’t remain quiet for long, however. In the early 1940’s, the Justice Department’s Antitrust Division filed two landmark lawsuits against A&P, one in Dallas in 1942 and a second in Danville, Illinois, in 1944. For the second suit, the list of charges filled ten pages, which Progressive Grocer condensed to a page and a half and I’ll further boil down to a few lines (This is “Web 2.0”, right? Whatever the heck that means.) as follows. The main points of the lawsuit alleged:

· That A&P purposely ran stores at a loss to drive out competition.
· That A&P held a “partial monopoly”, because of “illegal” practices in manufacturing, wholesaling and retailing.
· That A&P was able to obtain preferential allowances and discounts in violation of the Robinson-Patman Act.
· That A&P took profits from its manufacturing plants and used them to subsidize its retail stores.
· That A&P’s produce subsidiary, The Atlantic Commission Company, which sold to other chains as well, dominated or controlled markets, overcharging or selling inferior products to competitors.

A&P lost the case and a subsequent appeal, eventually agreeing to pay a $175,000 fine and to dismantle the Atlantic Commission Company. The judge who handled the case still had words of praise for A&P: “To buy, sell and distribute to a substantial portion of 130 million people (the U.S. population at the time) one and three-quarters billion dollars worth of food annually, at a profit of 1.5 cents on each dollar, is an achievement one many be proud of.”

Yet it wasn’t over. In September 1949, less than a year after the previous case finally ended, the Attorney General of the United States filed a new lawsuit – this time calling for no less than the Breakup of The Great Atlantic and Pacific Tea Company. Rumors were floating that the government was proposing a plan to split A&P into seven separate regional companies. (For those of you who are at least my age or maybe a few years younger, this may “ring a bell”. Get it? Ok, I’ll stop.)

A&P had used advertising to a limited extent in their previous struggles to help rally public opinion to their side. Exasperated that they were facing this situation yet again, they declared an all-out P.R. war this time around. In late 1949, a series of full-page newspaper ads were taken out in (according to Time Magazine) some 1,800 papers across the country, laying out A&P’s side of the story in painstaking detail.

By far, the most intriguing of these ads appeared on November 11, 1949, featuring testimonials from several of the company’s competitors, undertaking an impassioned defense of A&P. “Who hollered for Uncle?” “We Agree With A&P” “We Don’t Want the A&P Put Out of Business”, and so on, followed by detailed explanations of their positions. The motivations were wide-ranging –including a genuine respect for A&P as a major food supplier for millions, and concern for their tens of thousands of employees. Several of them started their careers with A&P before striking out on their own, the sentimental ties still evident. And then there were the objections on principle – as a “threat against our system of free enterprise”, a threat to growth aspirations of their own. Or perhaps the objections stemmed from a sense of being exploited, regardless of the potential financial gain for them should A&P go down.

The strategy worked. Before long, letters began pouring into Washington D.C. from hundreds of consumers, upset that the government was threatening to mess with “their A&P”. It soon became evident that a majority of people were convinced that the government’s case against A&P lacked merit. The case slowly faded away, ending in 1953 with a consent decree that called for a handful of wholly inconsequential changes at A&P.

Sadly, the one person who no doubt did the most to help A&P weather these storms passed away before their final legal victory. At age 79, John Hartford was still as active as ever, running A&P along with his brother and sitting on a number of other corporate boards. On September 20, 1951, Hartford collapsed and died moments after attending a Chrysler Corporation board meeting in their famous namesake building in New York City. It would be years before the full magnitude of the loss to A&P, in terms of ingenuity, judgment and fine-tuned empathy for the customer, would be completely realized.

At least now, though, A&P was finally free from all of the legal distractions and could chart its own destiny again.

The photos above are all from Chain Store Age, and from top to bottom, show – an unknown exterior from 1941, the meat counter from the Rockville Centre, Long Island, NY store from 1937, an exterior view from Birmingham, Alabama in 1939, an interior from Pittsburgh in 1937, exterior and interior views from Asbury Park, New Jersey (Or is that Granada I see? No, just Asbury Park.) in 1937, and finally two views of another Birmingham unit from 1939, from the Five Points shopping center, with Scott 5 and 10 next door.

Pictured below are John and George, the brothers Hartford, in contrasting styles of dress and matching Bakelite telephones, as photographed for Life Magazine in 1949. Two of the 1949 ad campaign newspaper pages can be seen in the background. (Thanks to Richard of the great Viewliner Ltd. site for the tip on the Google Life Magazine archives. Some fine stuff there!) Lastly, for your reading pleasure, are the two ads pictured behind the Hartfords. Click to enlarge and read.

Every Pound Custom Ground at A&P

Quick, name for me the one private label brand that through history has been most closely associated with A&P. Ah, “Ann Page Pickled Pigs Feet”, you say? Sorry, I’m afraid that’s not it. (Great guess, though!)

Even though the company started out as solely a merchant of tea, and 150 years after its founding still features the word “tea” in its name, the answer, of course, is coffee - “Eight O’Clock Coffee”, to be specific - a long-standing member of the pantheon of America’s legendary brands. For many people, the smell of fresh ground coffee and the sight of the huge in-store electric coffee grinders and the red and gold bags with the distinctive lettering constitute their fondest memories of A&P - long after they’ve moved away from an A&P, or A&P moved away from them.

Within a few short years after its 1859 founding, the company first introduced coffee. Eventually A&P’s house blend would come to be known as “Eight O’ Clock Breakfast Coffee”. The earliest use of this name that I’ve been able to find is in a small A&P ad that appeared in the May 27, 1888 edition of the Washington Post – “We recommend to all lovers of a cup of good coffee that they use our granulated Eight O’ Clock Breakfast Coffee which we sell at the low price of 25 cents per pound. Don’t fail to try it. For sale at all our stores.” Another line in the ad jumped out at me when I read it – “Coffee ground fresh with the aid of an electric engine.” Even today, the image of a manual hand-cranked coffee grinder is used in Eight O’Clock Coffee advertising, so it’s interesting to note that electric-motor driven grinders were indeed used in those long ago times.

Later on, the word “breakfast”, with its obvious limitations, was dropped from the brand name. In time, a legend formed around the creation of the name - that it was based on the times of day that people (in that era, at least) were most likely to drink coffee – 8 am and 8 pm.

Success was not long in coming, and soon several of A&P’s “tea company” competitors added coffee to their offerings. The book “That Wonderful A&P”, by Edwin Hoyt, cites the example of the Grand Union Tea Company, then known as Jones Brothers Tea Co., who introduced a line of “polished coffee”, in which their coffee beans were literally polished “to a shiny appearance”. Although this improved the taste not a bit, it made for an interesting, if bizarre, advertising angle. Hoyt quotes George Huntington Hartford’s advertising rebuttal on A&P’s behalf: “Positively no polishing matter is used in roasting our coffees. Our coffees are roasted and sold in their natural state, no ingredients whatever being used to make them glossy. BEWARE OF GLOSSY COFFEES!” Tell ‘em, George!

As coffee overtook tea as America’s most popular beverage in the early part of the 20th century, A&P, whose store count exploded in the ‘teens, found itself in a wonderful position to take advantage of the drink’s ever-growing popularity. For decades, Eight O’Clock Coffee would be the country’s largest selling coffee brand.

Having added a number of other coffee blends alongside their flagship Eight O’Clock brand through the years, A&P would eventually narrow their coffee lineup down to three main blends – “Eight O’Clock”, of course, the “mild and mellow” blend, “Red Circle”, the “rich and full-bodied” blend, and “Bokar”, the “vigorous and winey” blend (i.e.: the strong stuff.) In the early decades of the 20th century, each of the three brands had unique packaging.

In 1933, A&P introduced new, coordinated packaging for its three coffee brands. With bold colors – red for Eight O’Clock, yellow for Red Circle and black for Bokar - adorned with a gold band and a strikingly unique font, an American advertising icon was born. I’ve been unable to locate information on the designer A&P used, but would easily put it league with the best work of Raymond Loewy, designer extraordinaire, and the other great packaging designers of that golden era.

In the late 1930’s, Eight O’Clock coffee was hailed as the world’s top selling brand, and domestically, according to a 1935 Los Angeles Times article, A&P had three of the six bestselling brands – Eight O’Clock at number one, of course, with Red Circle ranked fourth and Bokar, sixth. Into the 1950’s, A&P’s share of the market remained strong, described variously as “one out of every six” or “one out of every four” cups of coffee served in the United States. (Today, one out of every six cups is consumed by me, when writing these posts.)

And so it continued for years, until A&P’s slow decline and exit from many of their major U.S. markets. Eight O’Clock’s fortunes were tied to A&P’s, of course, and as A&P began to contract its store footprint, the “number one” coffee crown would eventually pass to General Foods’ Maxwell House brand. (Currently, the largest individual selling coffee brand is Folger’s Classic Roast, with Maxwell House Original at number two, Starbucks at number three and Eight O’Clock Original at number nine, according to a recent CNBC survey. As far as overall sales go, Eight O'Clock is the largest selling bean coffee and the third largest overall brand in sales, according to their website.)

In the late 1970’s, A&P made an effort to shore up sagging profits through better use of its sprawling manufacturing operations. Through its subsidiary Compass Foods, A&P began to market its coffee brands to other chains, particularly in markets where they no longer had stores. In Chicago, for example, from which A&P pulled out in 1982, a cheery Chicago Tribune article proclaimed “Eight O’Clock coffee will stay in Chicago”, and would now be available at Jewel Food Stores.

The most important house brand manufactured by A&P would also be the last one they would hang onto. In 2003, A&P sold the Eight O’Clock brand to Gryphon, a San Francisco-based group of investors. In 2006, Gryphon sold the company to Tata, an Indian company that specializes in tea and coffee and owns the popular Tetley brand. Organized as “The Eight O’Clock Coffee Company” division, they have been very aggressive in marketing the famous old brand, adding several varieties and promoting it in new arenas – gas station convenience stores, for instance.
So, Eight O’Clock coffee might be as close as your nearest gas station! May have to drive a bit farther for those Jane Parker donuts, though…

The non-polished, yet glossy photos above depict various A&P coffee departments from the 1940’s and early 50’s. First is a 85th anniversary window display from Portland, Maine, followed by an iced coffee window display from Albany, New York. Next are two coffee department shots from Poughkeepsie, New York. The last shot is a bit more recent, from an unknown location, showing a common practice at the time - the placement of related magazine ads near the food displays. These local store publicity shots are part of a collection I bought a while back (Featuring, strangely enough, mostly A&P coffee displays. Not that I mind that!). Below are a group of wonderfully colorful A&P coffee ads from the 1930’s and 40’s, most of which are from Woman’s Day magazine, which was founded by A&P in 1942. These ads are from the Gallery of Graphic Design, a magnificent online collection of magazine advertising that is an absolute must-see. In that pre-television era, magazine ads were arguably the most important single vehicle for advertising to the mass market. The standard of artistry in these ads is high, to put it mildly.

Appropriately enough, the last ad, from 1938, has a Thanksgiving theme. An interesting year this has been, 2009. Great in some ways, difficult in others. I’m thankful for many things, though, and high on the list are those of you who read, enjoy and comment on this site. I hope yours is a wonderful one!