handle ten times as much business. In a short time, the system became known as the “seventh wonder” of the business world. Henry Ford is said to have visited the Chicago plant to study its efficient assembly-line technique.
Ironically, it was Ford’s own assembly lines that eventually forced Sears to take the next step in the march to plenty, the superstore . With affordable cars and the advent of better modern roads, Sears’s rural customers were no longer limited to shopping by catalog. Meanwhile, the great urbanization of America was beginning, and those same customers were abandoning the farm for the factory. In 1900, the rural population still outnumbered the urban population. By 1920, those figures had reversed.
City shoppers preferred stores to catalogs. In 1925, Sears opened one store in its Chicago mail-order plant. The experiment was an immediate success. Before the year was over, Sears had opened seven more retail stores—four in mail-order plants. By the end of 1927, it had twenty-seven stores. Huge selection and low prices appealed to everyone, and the supply-chain efficiencies Sears had developed for mail-order allowed the company to offer unprecedented selection in its retail stores, too (helping to lay the groundwork for what would eventually become the Wal-Mart model).
America was hooked on choice. The superstores offered huge selection at low prices. They preached the religion of economies of scale, a concept (bigger stores are more efficient) that required no more than a price-tag comparison between traditional merchants and superstores to understand. How much farther could it go?
FEEDING THE TAIL
Food was the next frontier. The first supermarket was a King Kullen store that opened in Queens, New York, on August 4, 1930, in thedepths of the Great Depression. Comparable to today’s no-frills warehouse outlets, this store sold more than one thousand products, serving as the catalyst for a new age in food retailing. Like Sears, King Kullen offered greater variety, lower prices, and one-stop shopping, along with the opportunity for customers to select products directly from shelves.
Along with self-service and abundance came the need to transport and store what had become weekly bulk grocery shopping trips, as opposed to the daily meal shopping of the previous grocer era. Key to the early success of the supermarket was the shopping cart (first introduced in 1937), the automobile, free parking lots, and mechanical refrigerators in the home and store.
In its official history of the industry, the Food Marketing Institute describes the effect:
The supermarket helped create the Middle Class. Its low prices freed up substantial funds for families to spend on cars, homes, education and other needs and amenities of life. As supermarkets proliferated in the 1950s and 1960s, they played a pivotal role in creating the American middle class. On the supermarket’s silver anniversary, President Kennedy said that the supermarket’s low-cost mass marketing techniques “…have enabled a higher standard of living and have contributed importantly to our economic growth.”
During the Cold War, from 1958 to 1988, some 50,000 Soviet citizens traveled to the U.S., most touring an American supermarket on their trip. The supermarket showcased how a free-market economy could deliver abundant, affordable food and became a metaphor for what capitalism could do and Communism could not. In his autobiography, Boris Yeltsin gave this account of his 1989 visit to a supermarket in Houston: “When I saw those shelves crammed with hundreds, thousands of cans, cartons, and goods of every possible sort, for the first time I felt quite frankly sick with despair for the Soviet people. That such a potentially super-rich country as ours has been brought to a state of such poverty! It is terrible to think of it.”
The corner grocery store of the 1920s had carried about 700 items, most sold in bulk, and consumers had to shop
Ironically, it was Ford’s own assembly lines that eventually forced Sears to take the next step in the march to plenty, the superstore . With affordable cars and the advent of better modern roads, Sears’s rural customers were no longer limited to shopping by catalog. Meanwhile, the great urbanization of America was beginning, and those same customers were abandoning the farm for the factory. In 1900, the rural population still outnumbered the urban population. By 1920, those figures had reversed.
City shoppers preferred stores to catalogs. In 1925, Sears opened one store in its Chicago mail-order plant. The experiment was an immediate success. Before the year was over, Sears had opened seven more retail stores—four in mail-order plants. By the end of 1927, it had twenty-seven stores. Huge selection and low prices appealed to everyone, and the supply-chain efficiencies Sears had developed for mail-order allowed the company to offer unprecedented selection in its retail stores, too (helping to lay the groundwork for what would eventually become the Wal-Mart model).
America was hooked on choice. The superstores offered huge selection at low prices. They preached the religion of economies of scale, a concept (bigger stores are more efficient) that required no more than a price-tag comparison between traditional merchants and superstores to understand. How much farther could it go?
FEEDING THE TAIL
Food was the next frontier. The first supermarket was a King Kullen store that opened in Queens, New York, on August 4, 1930, in thedepths of the Great Depression. Comparable to today’s no-frills warehouse outlets, this store sold more than one thousand products, serving as the catalyst for a new age in food retailing. Like Sears, King Kullen offered greater variety, lower prices, and one-stop shopping, along with the opportunity for customers to select products directly from shelves.
Along with self-service and abundance came the need to transport and store what had become weekly bulk grocery shopping trips, as opposed to the daily meal shopping of the previous grocer era. Key to the early success of the supermarket was the shopping cart (first introduced in 1937), the automobile, free parking lots, and mechanical refrigerators in the home and store.
In its official history of the industry, the Food Marketing Institute describes the effect:
The supermarket helped create the Middle Class. Its low prices freed up substantial funds for families to spend on cars, homes, education and other needs and amenities of life. As supermarkets proliferated in the 1950s and 1960s, they played a pivotal role in creating the American middle class. On the supermarket’s silver anniversary, President Kennedy said that the supermarket’s low-cost mass marketing techniques “…have enabled a higher standard of living and have contributed importantly to our economic growth.”
During the Cold War, from 1958 to 1988, some 50,000 Soviet citizens traveled to the U.S., most touring an American supermarket on their trip. The supermarket showcased how a free-market economy could deliver abundant, affordable food and became a metaphor for what capitalism could do and Communism could not. In his autobiography, Boris Yeltsin gave this account of his 1989 visit to a supermarket in Houston: “When I saw those shelves crammed with hundreds, thousands of cans, cartons, and goods of every possible sort, for the first time I felt quite frankly sick with despair for the Soviet people. That such a potentially super-rich country as ours has been brought to a state of such poverty! It is terrible to think of it.”
The corner grocery store of the 1920s had carried about 700 items, most sold in bulk, and consumers had to shop
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