Welcome to the Woolworths Museum
Making waves a century ago that still ripple across retailing today
On Wednesday January 24, 1923, all of the Buyers, Executives and Directors of the giant F.W. Woolworth Corporation gathered for their Annual Meeting, high above the Manhattan Skyline on the 24th floor of the Woolworth Building in Broadway Place. They had a lot to celebrate. In the tenth full year's trading since the $65m Merger sales had grown by 13.3% to $167.3m, with profit rocketing 32.9% to $18.3m. Both turnover and returns had almost tripled since the launch, while the number of outlets around the world had doubled from 614 to 1,302.
In keeping with tradition, a commemorative photograph was commissioned to mark the occasion. The Directors and Senior Executives are seated in the front row, with the Buyers standing behind. The central group consists of the Company's Second President, Hubert Templeton Parson, who was unanimously elected Frank Woolworth's successor in 1919 after serving for many years as his Treasurer (FD), sitting beside the 5 & 10¢ chain's three surviving Founder Directors, Charles Sumner Woolworth, the late Founder's Brother who became Chairman in 1919, Earle Perry Charlton and Fred Morgan Kirby. Sitting on the sofa to their left are two of the British Founders, William Lawrence Stephenson, the 3D and 6D Stores' only English Director on the far left (standing in for Fred Moore Woolworth who was unwell), and two to his right Byron Miller, who had distinguished himself in London for ten years before being recalled to New York to take over as Treasurer in 1919, also becoming a Vice President of the Parent Company.
The whole team could be proud that, despite a World War and a Global Flu Pandemic, Woolworth's had beaten all of the targets it had set in its original prospectus.
The choice of venue for the Executives' Annual Dinner is very topical a century later. The ballroom of the Hotel Commodore in East 42nd Street next to Great Central Station was one of the most prestigious venues in Manhattan at the time, and is the only part of the original architecture that survived a 1970s reimagination of the hotel. Even the Hyatt Grand Central is scheduled to close later in 2023 for the whole building to be taken down and replaced by an 89 story office tower.
Like all of the formal Dinners in Woolworth's early days, no wives were invited and (after the retirement of Mary Creighton, Frank Woolworth's sister-in-law) there were no female executives. So instead of going to the renowned Ballroom to dance, the chaps had arranged to watch a night's boxing in the 'Third Panels'. The ring is in the top left of the picture, behind the superimposed view of the Hotel's frontage in East 42nd Street.
On the voyage back from New York, Stephenson received shocking news by cable. His friend and boss Fred Woolworth had died suddenly, only a week after opening the new store at East Ham, north-east London. He was just fifty-one years old.
Unknown to the staff, Fred had suffered a slight stroke a year earlier, but had fought back. Even after the health scare he had rejected the US parent's devolved District structure, insisting that working directly with his hand-picked Superintendents allowed him to build a happier, richer and more fulfilled Store Management team, and a self-sustaining British talent pool. By opening each new store personally, getting to know the people and seeking first-hand customer feedback, he had been able to establish a distinct local brand, rather than imposing something from the USA. Perhaps that is why the British adopted 'Woolies' as their own.
On January 27, 1923 many Woolies' staff felt they had lost a friend rather than some big-boss, because so many had met him personally and appreciated his Yankee charm and sense of fun. At the centenary of his death, we salute Fred Moore Woolworth with a formal obituary, as well as a more intimate picture in our new Picot Mix feature, which showcases the way Fred helped three brothers to get started in the business.
Sadly Fred didn't live to see the culmination of his most ambitious project. Days after hearing of the death of his cousin, Frank Winfield Woolworth in 1919, he had been approached by an agent for Liverpool City Council. They had been working with the renowned department store Harrods of Knightsbridge on a redevelopment scheme in Church Street which would demolish the Pro-Cathedral opposite Woolworth's and replace it with the first huge, modern Harrods store outside London. At the eleventh hour financial problems had forced the retailer to pull out of the scheme, prompting an enquiry as to whether Woolworth might like to step in. Abandoning his usual caution, Fred said yes at once, quickly hatching a plan to honour the man who had given him his big break by putting up an elegant superstore in his memory to rival Frank's favourite in Fifth Avenue, New York. At a stroke this would resolve the severe overcrowding problems in the current Church Street store, adding plenty of room for future expansion. It would also thank Liverpool for getting the first British store off to a flying start.
Fred had recently hired William Priddle to be the Company's first employed architect, which he hoped would remove its dependence on expensive third parties when planning new stores. Creating a design that satisfied the Woolworth Boards in London and New York and that found favour with the City Fathers in Liverpool would be a good test for new man's skills, which the MD was certain he would pass with flying colours. Priddle pulled out all the stops, keen to impress his new boss, producing a truly remarkable building that went on to inspire several other flagships across the British Isles. The new Woolies opened to acclaim in Autumn 1923.
For comparison, here is a typical American new-build from 1923. Parson's property strategy was to focus on up-and-coming small towns, feeling that the Company had already reached saturation point in the Cities. Where possible Woolworth's would secure a sweetheart rent by being the first to sign a long lease in a new development. Ideally the premises would have a narrow frontage but be extra deep, often with counters down each side and a single central island, similar to the layout below. Note the particularly sharp view of the glass showcases for the chain's signature Weigh-Out Candy in the left foreground.
On the other side of the Rockies, the wholly owned subsidiary continued to expand rapidly. While the majority of outlets were in Ontario, the Company also experimented with stores in French-speaking Quebec and the occasional outlet further afield. The President of the American parent company, Hubert Parson, was proud of his Canadian origins and always strongly supported investment cases when they went onto the Board Room table in New York. The multi-view below shows one of 1923's openings in Windsor, Ontario both inside and out. The styling and layout copy features of Fred Woolworth's preferred British look. Executives from the Canadian Buying Office visited London regularly to exchange notes with their opposite numbers at Victory House and to pick up ideas from the UK, choosing to emphasise their links to London, and ensuring ample supplies of royal memorabilia, London-published novels and a wide selection of postcard views of the capital and the Royal Mile in Edinburgh.
William Stephenson wired Executive Office at Victory House in Kingsway, London from the radio room aboard a luxury liner in mid-Atlantic on his return crossing, to arrange for news of Fred Woolworth's death to be communicated without delay. He instructed that the stores should close and their staff be given the rest of the day off to absorb the news and begin to mourn. They would close again throughout the day of the funeral as a mark of respect. The late MD wished to have a funeral in London, but be interred in Maine, New England, USA.
Six weeks after Stephenson had disembarked in Southampton, Hubert Parson made the same crossing with Fred's son Norman Bailey Woolworth. Both men would attend a Board Meeting in London and the late MD's Funeral.
The Board Meeting was chaired by Stephenson. It passed a resolution proposed by Hubert Parson and seconded by Charles Hubbard expressing the Directors and Shareholders deep sympathy and regret at the loss of their Founding MD and thanking him for his wisdom, judgement and service in setting the Company on the road to success. It was passed unanimously. Those present also instructed that the Minute of the resolution should be written up in presentation format as a memento and permanent testimonial for the family.
As well as thanking the Directors for their kind words, Norman also fulfilled a promise he had made, expressing his father's most earnest wish that William Stephenson should succeed him as Managing Director. Parson was able to add that this wish had already been shared and agreed by the parent company Board at an extraordinary meeting in New York, subject to the support of the London Directors. Parson tabled the appointment as a resolution, which was also passed unanimously. Stephenson was pleased to accept, feigning surprise.
In reality both Fred and Frank Woolworth had groomed the Yorkshireman, preparing him for a step-up which they expected would come in the 1930s. Both had counselled him to stick to their formula when it was working, but never to be afraid to set a new direction if it was needed.
He had hero-worshipped Frank, having first met him when he was working as a Freight Clerk for Edward Owen and Company of Birmingham, when the Merchant Prince was already the head of a rapidly expanding and highly profitable syndicate of stores. He admired Fred. He was impressed by his encyclopaedic knowledge of not only the origins and margins of every piece of merchandise, but also the skills of every Manager and the layout of every building in the estate. But he was also sometimes frustrated by the great man's insistence on doing so much of the work himself, and occasionally by his caution in avoiding risk, for example on pretty rather than practical merchandise, or freehold instead of leasehold properties. The new MD would introduce changes, but mainly only to enable Woolworth's to deliver a lot more of the same, more quickly. As Stephenson planned to double the pace, he knew he must delegate, rather than burn himself out as Fred had done.
Initially the new MD took baby steps, authorising some new items of merchandise which had initially been rejected by his predecessor. A handful of stores had done trials of records after visits to the USA had highlighted the success that the parent company had enjoyed with its Little Wonder Label, but despite encouraging figures Fred Woolworth had been unconvinced that they were worth the risk, arguing that most households had pianos rather than gramophones, which is why John Snow sold so many sheets of his Sixpenny Pops. Stephenson launched a much more substantial trial, putting the two principal suppliers, Crystalate and Vocalion, head-to-head to discover which would produce the best catalogue of tiny five inch (7.5cm diameter) titles, and whether the sales level would represent a good return on the shelf-space they would require, and match the returns of Snow's simple music sheets. He also ordered glass island jewellery counters for a handful of superstores, instructing the Buyer to track down a source for 9 carat gold Bullseye Rings, brooches and pennants which had proved such a hit in the USA. The snap shows the display in Ilford, Essex at the beginning of 1924. He also authorised the china and glassware buyer Charlie McCarthy to add more luxurious designs to his collection of Greek Key Patterned 'cut glass' tumblers. The most popular of these was the champagne coup shown, which became a sixpenny special guaranteed to draw big crowds in-store. The tentative steps proved a hit in 1923, prompting an ever-increasing number of ornaments, luxuries and 'pretty' items to complement the stores' more practical lines which had been favoured by his predecessor.
The 1923 programme of store openings was already in progress, based on Fred Woolworth's priorities. With the exception of his Liverpool 'Cathedral of Commerce', and a fine store in Hamilton, Lanarkshire about 10 miles south-east of Glasgow, most were unambitious, comprising either budget single-story builds like in Halifax and Ipswich, conversions of existing leasehold properties like Pontypool's Crown Chambers in Monmouthshire (Gwent) or a cobbled together construction in The Moor, Sheffield where two properties were scarcely conjoined at street level. Stephenson would see through this programme, rebuild the store in Preston as a memorial to Fred, drawing extensively on the design the late MD had chosen for Liverpool, and then update the property strategy. He planned to double the pace of openings, adding both small branches in local High Streets, and new flagship stores at the heart of the City of London and in iconic locations like Chester, Lincoln and York. All would follow in 1924. The programme would prove controversial not in the Board Room in New York, but in the State's District Court. Draconian legislation had just been introduced curtailing New York-registered companies' ability to to develop freehold property overseas in the wake of a massive third-party fraud.
Above all, 1923 was a year for laying plans which would deliver big returns in the future. The strength of Byron Miller's bond with his friend William Stephenson had surprised Hubert Parson. The two had worked together very closely in the early days in Liverpool to build the range of products before John Snow had taken on the Buying Director role. Years later it was clear that they still collaborated very effectively together, making a powerful ideas machine. Parson hadn't met Stephenson in the early days. When Frank Woolworth had founded the British Company in 1909, as his Treasurer Hubert had made no secret that he was concerned. "Why take an unquantifiable risk overseas when potential profits are almost limitless by expanding the store base in the USA and Canada?", he had asked. As a result, Frank had left Parson to mind the shop at home in the USA, while he handled overseas matters himself, travelling to Europe twice a year to buy new ranges right across the Continent, finishing with a visit to the Potteries of Stoke-on-Trent in the English Midlands, before heading to London for a Board Meeting and catch up with his fellow Directors. That was why Parson's first real experience of Stephenson had been when he began to stand in for an ailing Fred Woolworth at Board Meetings in New York in 1922. It prompted Parson to suggest additional duties for Byron Miller, making him 'Supervisor of Overseas Operations' and, as such Stephenson's official point of contact when he needed help or advice from Executive Office in New York. He set the two men an objective to explore other countries that might be suitable for a subsidiary, hoping there could be other 'wonder children' to rival the outstanding return on investment generated in Britain. He suggested that in due course they schedule a session to report their findings back to the Board. The two friends enjoyed the task, approaching it with enthusiasm. They pinpointed two countries that had special potential.
- the holiday island of Cuba, situated to the east of Mexico and south of Florida, had become a popular holiday destination, particularly for American tourists. Its government promoted cordial commercial relations with the USA, and incentivised investments in its industry. 'America's playground' seemed to have particular potential for a small Woolworth chain, which should be able to launch quickly and cheaply. It would be possible to acquire an existing property in Havana and convert it into a Woolworth's without breaking the bank. It could stock a mixture of goods shipped over from the USA and local purchases. With the right approvals the idea could be ready to test before the end of 1924. Little would be lost if it failed, but if it succeeded returns could grow very rapidly. Expansion would be quite straightforward, meaning it could soon become self-sustaining, building a new income stream back to New York.
- the Weimar Republic of Germany also had particular potential for F.W. Woolworth Co. Its mass-manufacturing industries were well developed, with high productivity and a low cost-base. What was more its retail trade was buoyant despite the economic turmoil caused by the cruel reparations that had been imposed on the Country by the Treaty of Versailles after the Great War. Frank Woolworth had spotted its potential on his European Buying Trip in 1890. It opened his eyes and radically changed his ways of working. He went on to source millions of small items in Germany during his lifetime. He had commissioned a rented storage and collation warehouse there in Sonneberg, which paid small traders and family businesses cash for the goods, inspected and packed them and despatched them across the Atlantic to the Reshipping Warehouse in 6th Avenue, New York City. Give or take a break between 1914 and 1918, Germany had been the principal source for the 5 & 10¢'s highly lucrative range of Christmas Decorations, and for many of its best-selling toys and china ornaments. Berlin had recently hit the headlines when the Government had defaulted on the reparations. The media speculated that the American government would step in, offerring stronger economic ties with Germany, backed by loans and incentives. It would also encourage American businesses to invest there. This meant it might be the time to build on the foundations that Frank had laid. If the speculation was correct, Germany would soon have great potential for both an expanded wholesale sourcing operation and a retail business. These could be incorporated together as a single subsidiary, following broadly the same approach which had been adopted in the UK some fifteen years earlier.
The US Board liked the plans, authorising Miller to progress the Cuban experiment without delay. The Five-and-Ten opened its first branch in Cuba just a year later. They also agreed in principle with the idea of a German subsidiary, but considered it prudent to wait until the the plans being developed by Charles G. Dawes took shape. It didn't take long. F.W. Woolworth GMBH was incorporated early in 1926, setting to work immediately on a huge new warehouse with its own railway station in Sonneberg. The first store in Bremen, on Germany's north-west coast followed a year later. The Company still trades profitably today as Woolworth Ltd. The subsidiary was sold to its management when the parent company decided to retire the American brand in 1997. It has since been through a major corporate restructuring during the Credit Crunch and has emerged leaner and stronger, still as a substantial chain. One of its slogans (translated into English) is 'since 1879' the year when Frank Woolworth opened his first successful store in Lancaster, Pennsylvania.