February 12, 2007

Sears & Roebuck

And the men behind the brand are...
Richard Sears and Alvah Roebuck

First some facts. In its heyday Sears & Roebuck had the most stores, the most customers, the biggest building. The company was the biggest publisher in America. They shipped enough catalogs to fill a train of boxcars 30 miles long. One out approximately every 200 American workers worked for Sears.
Sears alone accounted for 1% of the American Gross National Product.

And it all began with a shipment of refused pocket watches.

Richard Sears was 15 when he became the family breadwinner in 1879.
He worked in the offices of the Minneapolis-St. Louis Railroad but pestered his bosses for a field job. They sent him to North Redwood, Minnesota as a freight agent.

Checking shipments in the station everyday Sears quickly learned about the mail order business. In 1886 a town jeweler refused a shipment of "yellow watches." The Chicago commission house handling the watches wired Sears that as the station agent he could have the watches for $12 each rather then incur the return shipping costs.

Sears knew the popular gold pocket watches were fetching $25 in retail stores. But he wasn't interested in retailing. He took the watches and sold them to local station agents down the line for $14 each. Anything they made over that they could keep.

Sears was hooked. As a bonded freight agent he did not have to pay to take delivery. He could settle his account when other agents paid him. It was a venture without risk, only profit. Sears began ordering more watches C.O.D.
In six months he had amassed more than $5000, a substantial fortune in 1886.

He moved to Minneapolis, the biggest city he knew, and founded the R.W. Sears Watch Company. He began advertising watches in the paper, unheard of at the time, and found he had a natural flair for the work. So many orders poured in he needed to move to Chicago to facilitate shipping in 1887.

In April 1887 an advertisement appeared in the Chicago Daily News:
"WANTED - Watchmaker with reference who can furnish tools. State age, experience and salary requirement." A tall, lean man from Hammond, Indiana answered the ad. He presented Sears an example of his best work. Sears studied it closely for a moment and admitted, "I don't know anything about watchmaking, but I presume this is good, otherwise you wouldn't have submitted it to me." Alvah Curtis Roebuck was hired.

Sears continued to build his business by undercutting the competition in price, often buying discontinued lines from suppliers. With low prices come suspicions of quality. Sears quelled such doubts with the strongest guarantees in the business.

Richard Sears was an aggressive, dynamic salesman who thrived in business competition. But a large part of him also longed for the bucolic country life.
In 1888 Sears sold his watch company for $72,000, retaining a half-interest in the firm's Toronto branch. Roebuck owned 25% of the Canada business.
Sears invested $60,000 of his money in Iowa farm mortgages.

By 1889 Sears was again selling watches in Minnesota, doing business as the Warren Company, his middle name. Again he lasted only a year before retiring. This time he sold his Toronto business and his Minnesota concern to Roebuck.

A week later he was back. He asked Roebuck for half the company and soon their first watch catalog, featuring 52 pages, was published. Sears added products to the book as they caught his fancy. By 1893 he had added bicycles and organs and other general merchandise and the catalog grew to 322 pages. It was the first familiar all-purpose catalog from Sears & Roebuck, "The Cheapest Supply House on Earth."

The business was always buoyed by its pledge: We Guarantee Satisfaction and Safe Delivery on Everything You Order. The story circulated through the Midwest of a customer who had come to Richard Sears with a crusty, bruised watch he had dropped on a rock in the mud. Sears handed him a new watch. When the customer protested that the damage was his own fault Sears stopped him,
"We guarantee our watches not to fall out of people's pockets and bounce in the mud."

Sears wrote to the farmers in their own language - simple, earthy and direct. He called his catalog "the farmer's friend" and built confidence in rural America that they could comfortably write to the big city. Sears called his business plan "Iowaization."

In 1893 Sears & Roebuck again outgrew Minneapolis and returned to Chicago. Despite the general economic Panic Sears stepped up his advertising, driving the company into debt but boosting sales. If the orders slowed the company would fail and Sears kept expanding.

It was the proper strategy for long-term growth but the short-term risk was too much for Alvah Roebuck, who was at heart a tinkerer not a high-stakes gambler. In 1895 he asked Sears for $25,000 for his share of the company and got out.
In short order Sears located two new partners and Roebuck returned as the firm's head of watches and jewelry, seemingly not perturbed at the new arrangement.

Richard Sears was something of a loose cannon. His outrageous advertising claims were legendary. Once he started a banking department where customers could drop off savings for 5% interest, in complete violation of state banking laws. A sound businessman was needed to balance the irrepressible Sears.
Alvah Roebuck gave up but Julius Rosenwald, his next partner, steadied the enterprise.

Sears & Roebuck continued to expand as the economy strengthened. In one issue of Comfort magazine Sears placed 70 different ads, each bursting with copy from border to border. Sears travelled extensively in Europe seeking medical help for his ailing wife but kept a steady stream of ideas flowing to Chicago.

The Panic of 1907 exacerbated the differences between the expansionist Sears and Rosenwald. His chief satisfaction was derived not in making money but in making the company grow. In 1908 Sears resigned as president. He was named Chairman of the Board but never attended a board meeting. He spent his time on his great farm outside Waukesha, Wisconsin until his death in 1914 at the age of 50.

After Alvah Roebuck left the company in the early 1900s he made a modest fortune developing equipment in the infant motion picture industry. He was wiped out by the Depression and returned to Chicago at age 69 to seek work with the company that bore his name.

He stopped by a local store and the manager asked if he could publicize the visit of one of the founders. People poured in to see the Roebuck of Sears & Roebuck. He went on salary, touring for several years and writing a personal history of the company's early days. He died in 1948 at the age of 84, once again a shareholder in Sears, Roebuck & Company by virtue of the firm's profit-sharing plan.

51 comments:

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I always thought that Roebuck was black, but see no mention of that here. Was he?

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I too am searching for the race of Roebuck. Was he a Black man?

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I work for Sears part time. A co worker at my full time job called me at home and asked me about Roebuck. I immediately told him that he was Black. That's what I had heard. I then began my research. I have found NO evidence that he was a Black man. I am going to continue my research.

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