Americans love bargains. They will drive for miles in the hope of picking up a "conversation piece". They will walk around antique shops and
second-hand stores for all sorts of commodities. They will buy things just because they are bargains, and not necessarily because they have any use
for them. It is very likely that this love of bargain is true for all people, but in America it played an important part in the first five-and-ten- cents
store. Today, buying and selling merchandise is a specialized business. Some practice it as a highly-skilled trade; others regard it as a profession
requiring specific knowledge and years of experience. The storekeepers in Woolworth's time had never heard of such words as merchandising,
sales promotion, public relations, windowos displays, advertising, discounts, consumer appeal and many other with which we are familiar today.
In those days, "drummers," as traveling salesmen were called, brought their wares to the storekeeper. The storekeeper would choose and buy
whatever items he thought his customers would want. If the storekeeper's judgment was poor, the goods stayed on the shelves and gathered dust.
The only merchandising activity of the storekeeper occurred when his shelves became too crowded. He would then hold a grand sale or a
grand reduction sale to clear out the slow moving merchandise. Certain articles were always in demand, such as knives and many other small
household items. The storekeeper bought them from the drummer for the lowest possible price. He sold the goods, made a small profit, and
ordered more. His usual order was too small for the manufacturer to bother with, but the drummer ordered for several storekeepers at once.
This way of doing business made it possible for small, independent storekeepers to exist. The idea of a chain of stores buying directly from the
manufacturer in large quantities and selling in many differnt places throughout the country, had its beginning with Woolworth, Kress, Kresge,
and others who followed them. They were the forerunners of the large retail chain and department stores. These men had the vision to see that
the more the manufacturers produced, the greater would be the saving to the consumer.
Frank Woolworth was born in the town of Rodman in New York state, in the year 1852. He had a poverty-stricken childhood, which meant
hardly enough to eat, one pair of boots a year, and never a warm coat for the winter. Frank did not like farming. He dreamed of being a railroad
engineer. Later, he changed his ambition and wanted to becomea merchant. When Frank Woolworth was a young man apprenticeship was still
in existence, particularly in the eastern part of the United States. A boy was taken into business to learn a trade, or to learn how to conduct the
business. He was considered to worth very little to the owner during his learning period. Sometimes, the apprentice would be given his board and
a room. The businessman felt that he was doing something worthwhile for the young man he took as an apprentice. He reasoned that it was like
sending the young man to a school and paying his tuition.
Woolworth managed to take a short commercial course which he knew he needed to become a merchant. At first, he was given a small wage
of three dollars and fifty cents a week in the firm of Moore and Smith. After a while Woolworth came to the conclusion that while he was
not a good salesman, he could trim the store and dress the windows to attract customers. In time, he worked up to six dollars a week.
Another merchant offered him ten dollars a week and Woolworth decided that it was enough to marry on. Unfortunatly, his new employer was
not interested in having his windows dressed. And after a week or two of Woolworth's poor salesmanship, he reduced his wages to eight dollars
With a wife to support now, Woolworth decided to try farming. He bought a farm on mortgage and he and his wife raised chickens. But in a short
time, farming bored him. Besides, Moore and Smith asked him to return to his job. They found that they needed Woolworth as a window trimmer
to attract customers. When they offered him the job at ten dollars a week, Woolworth went back to working in the store. One day, at closing
time, Mr. Moore cast an eye on some small remnants of cotton cloth, cashmere and other odds and ends. He told Frank to gather them up and
put them on a table. "Sell them for what you can get" he said. Woolworth put a sign on the table which read: "Any article on this table. 5 cents.
People grabbed and pushed to buy, and the table was cleared in a short time.
Pleased with this success, Moore went to New York city and bought a hundred dollars worth of cheap materials. Back in watertown, New York,
he advertised a sale by distributing handbills. Within a few hours, all the goods had been sold. From this experience, Woolworth learned that
the word "bargain" sold goods to the American people. He decided that a store carrying low-price articles would draw many customers. He
opened a store in Utica, New York, with the idea that it would be a testing-ground for a chain of five-and-ten cents stores throughout the
country. The store failed, but, undiscourage, Woolworth opened another store in Lancaster, Pennsylvania.
Frank Wollworth had learned enough to realize the selling low-priced goods would not be profitable unless he bought cheaply, direct from the
manufacturer. A certain knife that was manufactured in Germany sold well in his stores. Woolworth went to Germany to try to buy the knife
at a lower price. He held up the knife and told the manufacturer that while it was a good knife, the price was too high. The German told him
what it cost him to manufacture it. "What about if I give you a big order" (Woolworth named a large order), "at what price could you sell it to
me?", the German figured a price of sixteen cents a knife. "Now, suppose I gave you an order large enough to keep your factory going for
twenty-four hours a day for a year? what then?", "eight cents", said the manufacturer. "Sold" said Woolworth.
Other businessmen did not like this way of doing business. By taking a manufacturer's output for a year, Woolworth prevented him from selling to
others. Besides many businessmen felt that it was not right for Woolworth, by this method, to be able to dictate production costs. Woolworth
aswer was that the small merchat would have to find his won way to survive the competition. By 1919, Woolworth had over a thousand
stores throughout the United States and Canada, as well as a branch in London.