February 12, 2007

J.C. Penney's

And the man behind the brand is...
James Cash Penney

James Cash Penney named his first store "Golden Rule." He was going to combine ethics and business in his store on the frontier. The ethics he had learned growing up as a minister's son in Hamilton, Missouri. The business instincts seemed to come naturally.

His career started in 1883 at the age of 8 when his father told him he would have to buy his own clothing. James had saved $2.50 from errands and bought a pig. He fattened the pig for several months, sold it at a profit and reinvested in more pigs. Soon he had a dozen pigs - and some unhappy neighbors. His father forced him to give up his young business.

As a young man Penney worked as a clerk. His first job paid $2.27 a month. He journeyed to Colorado for health reasons and invested his small savings in a butcher shop. His meatcutter told him his most important duty would be supplying the chef at the local hotel with a bottle of bourbon each week. Penney did it once and regretted it immediately. He ended the liquor bribes and lost his biggest account and the business.

In 1902 Penney went to the mining town of Kemmerer, population 1000,
in the southwestern hills of Wyoming. With $500 of his own money and $1500 of borrowed capital he joined a 1/3 partnership in a store Penney would run.

The Golden Rule was a shack on a muddy sidestreet in downtown Kemmerer. On one side was a laundry, on the other a boarding house. Penney lived upstairs with his family. The venture was not without risk. At the time part of a miner's wage was scrip redeemable only at the mining company store's inflated prices. Outside competition was decidedly not welcome.

Penney was determined to sell goods at prices as low as possible with a one-price policy for all. He would cater to the needs of rural America by selling basic types of merchandise his customers would need. His concepts were well-received. First day cash receipts totalled $466.59.

Penney did so well he was able to buy his partners out for $30,000 in 1907. Right from the start he had dreamed of a chain stores. He developed a partnership idea where the new store owner would own 1/3 of the new Golden Rule provided he had a man trained to run the store. These men trained others who would go and start their own stores in new western towns. The policy led to rapid and successful expansion. By the 1930s there was a Penney's store in every western town with a population greater than 5000.

In 1913 Golden Rule became J.C. Penney. The name was so trusted that lumberjacks were known to leave six months pay for safekeeping with a Penney's manager whom they had never seen but whom they trusted merely because he was a Penney's man.

In 1917 James Penney retired as President to devote himself to philanthropic interests. He remained as Chairman of the Board, a strictly honorary position. The Stock Market Crash drained his $40,000,000 fortune and broke, discouraged and ill Penney entered a Battle Creek, Michigan sanitarium where he prepared himself to die, considering himself a failure.

But he recovered and returned home with a renewed interest in the Penney Company. He travelled around the country attending company conventions and rarely missed an important store opening. Everywhere he went people were thrilled to see the J.C. Penney in their store. He raised prize cattle, his life having come full circle. Penney lived to be 95, just short of his oft-stated goal of 100.
He was the last of the great merchant princes.

1 comment:

Anonymous said...

I have to do a report on Richard Sears and Alvah Roebuck!!!
I need help!!!Any websites??? Please???