Early expansion and the friendly rivals 1879-1900

After a single day's trading in Lancaster, Pennsylvania, Frank Woolworth wrote to his father telling him of plans to expand. He persuaded his brother, Charles Sumner Woolworth ("Sum"), to join him as Manager of a small, satellite store in nearby Harrisburg. The new store opened just a month later on July 19th 1879. On the first day it took $85.41, and traded well for several weeks.

Sum was a good partner and a diligent worker but, try as he might, the location was far from ideal. Despite a sales revival in the run-up to Christmas the going was tough and the brothers were convinced that they could do better, particularly when the landlord demanded a higher rent. So over and above trading the stores for long hours, they travelled far and wide in search of other towns and premises. In March they closed Harrisburg, with Sum helping out in Lancaster for a short time.

After another experiment in nearby York, during which Sum was paid the princely salary of $8 a week, the brothers struck on a new location on the east side of Lackawanna Avenue, in fashionable Scranton. The store opened on November 6th, 1880.

Before long Sum bought a half-share in the store, later buying the premises outright from his brother. He made Scranton his home, and it remained his favourite store throughout a remarkable carrier spanning 68 years with the business. In later life he remembered that the premises seemed huge in comparison with the Lancaster or York stores - simply too big. The rental was low so they decided to take on the lease and to build a false wall about two-thirds of the way back to partition a front sales area from a rear store room.

Although Sum bought certain products locally, most of the range was selected by brother Frank, who was keen to build economies of scale through a buying syndicate.

Sales on opening day were just $43.20, but peaked at $235.07 on Christmas Eve. After a while the peaks and troughs started to level out with the store taking good money. In the first full year's trading total turnover exceeded $9,000.

In 1881 Frank Woolworth went "on holiday" back to Watertown. He was greeted as a hero, boasting $4,000 profits so far. William Moore entertained Frank and his wife Jennie as old friends and fellow-merchants.

Frank was on the look out for partners. With remarkable commercial acumen he had worked out that a chain of stores, spread far and wide would give him lots of buying power without the stores competing directly. He could also avoid debt if each store was run by a partner who put up stake money in exchange for a share of the profits. Hence the friendly rivals were born.

Before long he had signed up his cousins Seymour Knox and Edwin McBrier, and had explored the idea with Fred Kirby, Carson Peck, Clinton Case and Alice Coons - all his co-workers when he worked at Moores.

Kirby later went into partnership with Sum Woolworth. The two men opened a store in Wilkes-Barre in 1884, just a fortnight before Frank Woolworth opened a branch with Seymour Knox in Reading, Pennsylvania. Knox later signed up another friendly rival, Earle Perry Charlton in 1889. As the new joiners grew in confidence they bought out their partners and operated in a friendly alliance. During the 1890s they pushed five-and-ten formula out across North America. The Syndicate Members pooled knowledge and buying power, and were careful not to tread on each other's toes. Knox and Charlton opened stores in Canada, the first to the East and the second to the West of the Rockies. Kirby headed South, colonising Ohio, and Virginia and Kentucky en-route for Louisiana. From time-to-time the friendly rivals swapped stores. Frank Woolworth and Knox opted to expand by buying up rival chains, sometimes paying heavy premiums to accelerate their progress.

Five and ten stores became a phenomenon, with Woolworth Syndicate far outstripping their main competitors, McCrory, Kresge and N.M. Rothschild. Part of their secret was Frank Woolworth's buying, which was widely acknowledged to be second to none. But part of the secret was in the marketing, with the stores among the first to loss-lead to gain new business.

Each of the pioneers made a lot of money during this time. But the great majority of the proceeds were ploughed into more openings, and, as time went on, into an improved store environment. Where once the gold lettering on the masthead was the only significant asset in a new store opening, progressively the stores introduced elaborate mahogany counters and full electric lighting, which set them apart from their rivals.

Throughout this period Frank Woolworth was loyal to his friends and tough on anyone who crossed him. When William Moore's Watertown store got into trouble in 1885 Frank baled him out and set him up in a five and ten cent store of his own. But when cousin Herbert G. Woolworth decided to go it alone and set up stores outside the syndicate, Frank took great pleasure in watching him go broke and then picking up the stores for next to nothing.

Staff as well as Managers had good reasons to thank Frank. He introduced Christmas bonuses in the 1880s - based on number of years' service - and paid holidays for all staff from 1896 onwards, long before other firms.

With the exception of Sum Woolworth, the Syndicate Members all incorporated between 1905 and 1908, selling shares to family, friends and staff.

At home with the Woolworths: the Five and Ten's Management pictured in 1884

Shortcuts to other exhibits in our 1800s Gallery

1800s Overview: the story begins
Formative years of the Woolworth Brothers
Birthplace - Augsbury & Moore, Watertown, NY
The first five cent table
Experimental five cent store in Utica (a flop)
First successful store - Lancaster PA 1879
The 'friendly rivals' buying syndicate
Frank Woolworth's early buying trips to Europe