| Industry | Retail |
|---|---|
| Fate | Name changed in 1997 to Venator Group, and in 2001 to Foot Locker, Inc.[1] |
| Founded | 1879 |
| Defunct | 1997 |
| Headquarters | New York, NY, USA |
| Products | Clothing, footwear, bedding, furniture, jewelry, beauty products, consumer electronics and housewares |
| Subsidiaries | Woolco (defunct 1982 in the U.S., Canadian stores sold to Wal-Mart in 1994) Woolworths Group plc (separate 1982) Woolworth GmbH (separate 1998) Kinney Shoe Company (acquired 1963), now Foot Locker (successor) |
The F. W. Woolworth Company (often referred to as Woolworth's or Woolworth, or even Woolsworth) was a retail company that was one of the original American five-and-dime stores. The first successful Woolworth store was opened on July 18, 1879 by Frank Winfield Woolworth in Lancaster, Pennsylvania as "Woolworth's Great Five Cent Store". Soon, Frank brought his brother, Charles Sumner Woolworth, whom everyone called Sum, into the business. With $127.50 Frank opened a second "Woolworth's Great Five Cent Store" in Harrisburg, Pennsylvania which was then managed by Sum. Sum worked with Frank at the Augsbury and Moore dry goods store in Watertown, New York and had also managed a Augsbury and Moore store in Morristown, New York. Business in Harrisburg flourished, and soon the landlord wanted to raise the rent. Rather than pay more in rent, Frank and Sum moved the store to York, Pennsylvania then to Scranton, Pennsylvania, a city which Sum quickly loved. Frank had tested a small line of ten-cent items at his Lancaster store. So when the Scranton store opened, the sign read "5¢ & 10¢ WOOLWORTH BRO'S STORE" thus becoming the first five-and-ten-cent (dime) store in the world at 125 Penn Ave. While Frank traveled a lot to expand the business, Sum perfected the merchandising formula in Scranton. He based his operations in the Pennsylvania coal town and remained in Scranton during his decades as Chairman of F. W. Woolworth. Despite growing to be one of the largest retail chains in the world through most of the 20th century, increased competition led to its decline beginning in the 1980s. The chain went out of business in July 1997, when the company decided to focus on the Foot Locker division and renamed itself Venator Group. By 2001, the company focused exclusively on the sporting goods market, changing its name to the present Foot Locker Inc (NYSE: FL).
Retail chains using the Woolworth name survive in Germany, Austria, Mexico, South Africa and, until the start of 2009, in the United Kingdom. The similarly named Woolworth's supermarkets in Australia and New Zealand are operated by Australia's largest retail company Woolworths Limited, a separate company with no historical links to the F.W. Woolworth Company or Foot Locker, Inc. However, Woolworth's Limited did use the name from the original company, as it had not been registered or trademarked in Australia at the time.
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The F.W. Woolworth Co. had the first five-and-dime stores, which sold discounted general merchandise at fixed prices, usually five or ten cents, undercutting the prices of other local merchants. Woolworth, as the stores popularly became known, was one of the first American retailers to put merchandise out for the shopping public to handle and select without the assistance of a sales clerk. Earlier retailers had kept all merchandise behind a counter, and customers presented the clerk with a list of items they wished to buy.
After working in a dry goods store in Watertown, New York, Frank Winfield Woolworth opened the "Woolworth's Great Five Cent Store" in Utica, New York, on February 22, 1878. The store failed and closed in May 1878. Frank soon made a second attempt and opened his "Woolworth's Great Five Cent Store", using the same sign, on June 21, 1879, in Lancaster, Pennsylvania with a revised formula of merchandise. Lancaster proved a success, and Frank never forgot the city for the rest of his life. Frank hired his brother Charles Sumner "Sum" Woolworth as manager for a second store in Harrisburg, Pennsylvania. After a fallout with the landlord, that store moved to York, Pennsylvania. That store did not last long, either. Frank searched for a a larger, low rent building. He found an ideal location in Scranton, Pennsylvania at 125 Penn Avenue and opened the store on November 6, 1880 with Sum as manager. The Scranton store is where Sum developed the brothers' "5¢ & 10¢" merchandising model. He spent a lot of time working the sales floor, talking with customers, and employees. He often personally served customers. Sales grew steadily. By 1881 at Franks suggestion, Sum bought out his brother's share of the Scranton store in two installments, in January 1881 and 1882. This made Sum the first Woolworth Bro's franchisee.
In 1884, confident enough to open another store, Sum partnered with his long-time friend Fred Kirby to open a store in Wilkes Barre, Pennsylvania, a neighboring town to the west of Scranton. Fred had been working as the head of wholesale operations at Moore and Smith. Each man put up $600 to launch the Wilkes-Barre store called "Woolworth and Kirby". Fred managed the new store, and while Sales were initially poor, the store soon caught on. By 1887 he used his profits to buy out Sum and expand the store under his name. Sum and Fred remained the best of friends. During this time, Frank was expanding with more stores. Sum's approach was different; he worked to perfect the look and feel of his Scranton store. It had mahogany counters with glass dividers and glass-fronted showcases. The store was brightly lit, new, and the wooden floor was polished to a lustrous shine. The layout was soon adopted by Frank for his F. W. Woolworth stores and became the standard as the two brothers persuaded family members and former co-workers from Moores to join them in forming a 'friendly rival syndicate' of five-and-ten-cent stores. Each of the syndicate chain's stores looked similar inside and out but operated under its founder's name. Frank Woolworth provided much of the merchandise, encouraging the rivals to club together to maximize their inventory and purchasing power.
At the same time, using his preference to have someone he could trust, Frank brought in their cousin, Seymour Knox, to open a store in Reading, Pennsylvania under the name "Woolworth and Knox". Seymour had been managing a general store in Michigan. [2]
By 1904, there were six chains of affiliated stores operating in the United States and Canada. Between 1905 and 1908, members of the Woolworth Syndicate followed Frank's lead to incorporate their businesses. Sum maintained that he did not need to incorporate his stores. In 1912 the syndicate agreed to a scheme crafted by Frank Woolworth: to join forces and incorporate as one corporate entity under the name "F. W. Woolworth Company" in a merger of all 596 stores. The stock flotation raised over $30 million for the five founders of the merged chains. They all swallowed their pride and accepted Frank's name above the door, with Frank as President of the new Corporation. Sum Woolworth, Fred Kirby, Seymour Knox, Earle Charlton, and William Moore each became a Director and Vice-President. One of the "friendly rival" predecessor chains included several stores initially opened as Woolworth & Knox stores starting as early as September 20, 1884 as well as S. H. Knox & Co. 5 & 10 Cent Stores opened after an 1889 buyout by his cousin, Seymour H. Knox I. Knox's chain grew to 98 U.S. and 13 Canada stores by the time of the corporate consolidation. Fred M. Kirby added 96 stores, Earle Charlton added 35, Charles Sumner Woolworth added 15, and William Moore added two. [3]
Sum Woolworth continued to maintain his home base in Scranton, PA. He was not the type to get embroiled in the politics, as executives of the different chains sought to establish themselves in the merger. As he did from the beginning, Sum concentrated on improving stores, particularly in his native Pennsylvania, and training up-and-coming managers. Those managers eventually dispersed across the entire company, setting the style and tone of Woolworth stores worldwide.
In 1900, Frank launched his first development plan in the city of his first success, Lancaster, Pennsylvania. Rather than just enlarging his store on North Queen Street, he bought up properties along the street in an area which was not considered a "good" side of town. By keeping everything quiet and in that area, real estate prices were not inflated. When he finished the real estate purchases, he announced his plan to build a skyscraper, a building with five floors of offices above a large store. The roof had a garden and an open-air theater. The theater was a huge hit in town, and soon became the city's social center. This project was something of a dress rehearsal for his next venture.
In 1910, Frank Woolworth took another leap and commissioned the design and construction of the Woolworth Building in New York City. A pioneering early skyscraper, more than twice the height of most other buildings in New York City at the time, it was designed by American architect Cass Gilbert, a graduate of the MIT architecture school. The building was entirely paid for in cash. It was completed in 1913 and was the tallest building in the world until 1930. It also served as the company’s headquarters until it was sold by the F.W. Woolworth Company’s successor, the Venator Group (now Foot Locker), in 1998.
Frank Woolworth, president of F. W. Woolworth, Corporation, died in 1919, in Glen Cove, New York. Sum's demeanor made him the perfect candidate to head the F. W. Woolworth Corporation after the death of his brother. He was non-confrontational, as everyone else positioned themselves in the company. The Board of Directors unanimously asked Sum to take on the Presidency. With his infamous modesty he declined. He did, however, agree to take the new role of Chairman. Company Treasurer, Hubert Parson, took the Presidency. Over the following twenty-five years, Sum saw four Presidents come and go. He gave each one quiet-spoken advice and good counsel. As Chairman, he facilitated debate and ensured issues were properly confronted and argued out by the Board.
The stores eventually incorporated lunch counters after the success of the counters in the first store in the UK in Liverpool and served as general gathering places, a precursor to the modern shopping mall food court. A Woolworth’s lunch counter in Greensboro, North Carolina became the setting for a significant event during the civil rights movement (see below).
The Woolworth's concept was widely copied, and five-and-ten-cent stores (also known as five-and-dime stores or dimestores) became a 20th century fixture in American downtowns. They would serve as anchors for suburban strip centers and shopping malls in the 1950s, 1960s, and 1970s. Criticisms that five-and-dime stores drove local merchants out of business would repeat themselves in the early 21st century, when big box discount stores became popular. However, many five-and-dime stores were locally owned or franchised, as are many dollar stores today.
In the 1960s, the five-and-dime concept evolved into the larger discount store format. In 1962, Woolworth's founded a discount chain called Woolco. This was the same year as its competitors opened similar retail chains that sold merchandise at a discount: the S.S. Kresge Company opened Kmart, Dayton's opened Target, and Sam Walton opened his first Wal-Mart store.
By Woolworth’s 100th anniversary in 1979, it had become the largest department store chain in the world, according to the Guinness Book of World Records.
The growth and expansion of the company contributed to its downfall. The Woolworth company moved away from its five-and-dime roots and placed less emphasis on its department store chain as it focused on its specialty stores. Still, the company was unable to compete with other chains that had eroded its market share. While it was a success in Canada, the Woolco chain closed in the United States in 1983. On October 15, 1993, Woolworth's embarked on a restructuring plan that included closing half of its 800-plus general merchandise stores in the United States and converting its Canadian stores to a closeout division named The Bargain! Shop. Woolco and Woolworth survived in Canada until 1994, when the majority of its stores there were sold to Wal-Mart. Stores that were not purchased by Wal-Mart (primarily smaller locations) were converted to The Bargain! Shop stores, or sold to Zellers.
Still with the decline of the signature stores, Woolworth marched on with a new focus toward athletic goods on January 30, 1997, acquiring the mail-order catalogue athletic retailer Eastbay.
On May 6, 1991, Wal-Mart replaced Woolworth's as a component of the Dow Jones Industrial Average. Analysts at the time cited the lower prices of the large discount stores and the expansion of supermarket grocery stores – which had begun to stock merchandise also sold by five-and-dime stores – as contributors to Woolworth's decline in the late 20th century. On July 17, 1997, Woolworth's closed its remaining department stores in the U.S. and changed its corporate name to Venator.
In 1999, Venator moved out of the Woolworth building in New York City to offices on 34th Street. On October 20, 2001, the company changed names again; this time, it took the name of its top retail performer and became Foot Locker, Inc. Foot Locker stores chiefly sell athletic clothing and footwear.
On February 1, 1960, four black students sat down at a segregated lunch counter in a Greensboro, North Carolina Woolworth's store. They were refused service, touching off six months of sit-ins and economic boycotts that became a landmark event in the U.S. civil-rights movement. In 1993, an eight-foot section of the lunch counter was moved to the Smithsonian Institution and the store site now contains a civil rights museum, which had its grand opening on Monday, February 1, 2010, the 50th anniversary of the beginning of the sit-ins.[4]
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