The Rise Of The Supermarket

PrintPrintEmailEmail

U.S. Patent No. 1,242,872 was issued on October 9,1917, to Saunders for “certain new and useful improvements in Self-Serving Stores.” The legitimacy of his claims would subsequently be challenged in the courts and partially voided, but industry historians still count him as the progenitor of self-service food shopping. Saunders, who had entered the business as a fourteen-year-old clerk in a rural Virginia general store, called his new shop Piggly Wiggly—a name inspired by a plump shoat he chanced to see escaping through a fence—and it was an emporium like no other of that time. It had turnstiles at the entrance and a check-out counter at the exit. In between wound a single serpentine aisle lined with easy-to-reach goods. Customers took what they wanted and paid cash.

 

Simple as it sounds now, Saunders’s idea constituted a radical revision of retailing orthodoxy. Previously, groceries and dry goods had been sold on a credit-and-delivery basis. Customers presented their orders to clerks, and the clerks filled them. Accounts were periodically tallied, and bills prepared. After considerable scrutiny Saunders determined these practices to be massively wrong-headed and created his alternative. (In the interests of historical balance, it should be acknowledged that several merchants in the West, principally in Texas and Southern California, seem to have come to similar conclusions at approximately the same time. But Saunders got the patent.) Having eliminated much of his standing overhead, he slashed prices, and on a masterfully hyped mixture of novelty and economy he proceeded to build an empire.

Supermarkets seem so basic that it is difficult for us to comprehend the impact of their invention.
 
In naming the true Father of the Supermarket we get into suspect terrain, ambiguous and hotly contested.

Clarence Saunders stuck with his formula, and Piggly Wigglys proliferated. At the apex of the company’s growth there were nearly three thousand of them throughout the United States, and they all went by the book. Saunders’s instruction manuals were lengthy and complete, spelling out every aspect of the operation in exhaustive detail. His formula worked, and his corporate worth soared, eventually leading to his undoing. Armed with a satchelful of cash and determined to protect the value of his stock, Saunders stormed Wall Street in 1923. He began placing orders and driving the share price up until, on paper anyway, he held virtually all of the company’s outstanding common stock. At that point the New York Stock Exchange declared a corner, demanded that he pay for stock that he was buying on margin, and the whole precarious construction came tumbling down.

In the decades that followed, Saunders grew crankier and more iconoclastic. He’d built a fabulous pink palace in Memphis, but he never got the chance to live in it. His patent protection diluted, he turned to a new idea and set up a string of Clarence Saunders Sole-Owner-of-My-Name stores. When these foundered, he poured his energies into a futuristic merchandising format that he christened Keydoozle—key does all—a kind of grocery and dry goods automat where shoppers would use special “electric keys” to select items from closed display cases. The goods would then be ferried by conveyor to a check-out counter, there to be picked up and paid for. “Then she gives her tape to the cashier,” Saunders explained to a Forbes magazine reporter in 1941. “It is fed into automatic machinery that uses the punched holes to activate a sorting apparatus backstage. And as if by magic a moving belt produces her beans, butter, bread, cauliflower, Tabasco sauce and scallions. She pays her bill and walks out pop-eyed.” But popeyed was apparently not enough, for Keydoozle never got off the ground. After losing Piggly Wiggly, Saunders never flew quite so high again. Nevertheless, fully fourteen years before the first real supermarket is judged to have been born, Clarence Saunders had anticipated many of its essential elements.

During the early decades of this century a few major grocery chains—the Krogers and Safeways, the Grand Unions, and most of all the Hartford brothers’ Great Atlantic & Pacific Tea Company—came to dominate the nation’s retail food trade. The first A&P opened in 1859. By 1930 there were almost 16,000 of them. Between 1914 and 1930 the number of corporate chains more than tripled, while their cumulative retail outlets increased from 24,000 to some 200,000. The keystone of chain store development was an equation that linked efficiency and expansion. Independent stores were owner operated. Owners purchased their stock from wholesale distributors and sold it to consumers, earning a profit on the markup. Chain stores were operated by salaried clerks and supplied by the parent company, which bought goods directly from the manufacturers. The more outlets that were added to a chain, the greater was the portion of a producer’s output controlled by buyers for that chain, and thus they exerted an inescapable influence over price. As the chains’ range and power grew, they commanded ever more potent economies of scale and tightened the screws on independents.