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Macy's

MACY'S

MACY'S. In 1858, Rowland Hussey Macy opened a fancy dry goods store in New York City that evolved into


one of the world's largest and most famous department stores. After running unsuccessful stores in Massachusetts and in California during the gold rush, Macy employed a low price strategy and aggressive advertising to develop a fast-growing business. In 1874, he rented space in the basement to Lazarus Straus, his supplier of china, glass, and silverware. The member of a rich European Jewish family, Straus came to the United States after the revolution of 1848. He moved to Georgia, became a peddler, and eventually operated a store, before moving to New York. After R. H. Macy died in 1877, his successor took Straus as a partner in 1888 and sold him the entire store in 1896.

The Straus family moved the store to Herald Square (34th Street and Broadway) in 1902. With the completion of its Seventh Avenue expansion in 1924, Macy's became the largest store in the world (2,200,200 square feet). The company built its reputation by advertising heavily and consistently selling merchandise for less than the competition. The company advertised "We sell goods cheaper than any house in the world," and "Save 6% at Macy's." The term "Macy's basement" became a metaphor for crowds and "Macy's window" a synonym for a public place to be seen.

The Strauses became one of the richest families in America. Family patriarch Isidor and his wife Ida died on the voyage of the Titanic. His brother Jesse became Ambassador to France.

Macy's started one of the first in-store employee training programs in 1914 and began the famous executive training program in 1919. Many successful executives received their training at Macy's. Movie stars Carol Channing and Burgess Meredith as well as Mayor Jimmie Walker also worked at Macy's. The world-famous Macy's New York Thanksgiving Day Parade began in 1924. The corporation expanded outside of New York, buying stores in Toledo, Ohio (1923), Atlanta, Georgia (1925), Newark, New Jersey (1929), San Francisco (1945), and Kansas City, Missouri (1949).

In the 1980s the executives of Macy's purchased the company in a leveraged buyout. When sales did not meet estimates in 1992, the company incurred a large debt, forcing it into bankruptcy. Two years later, Federated Department Stores acquired control of Macy's and consolidated other Federated stores into new Macy's East and Macy's West divisions.

BIBLIOGRAPHY

Harris, Leon. Merchant Princes: An Intimate History of Jewish Families Who Built Great Department Stores. New York: Harper & Row, 1979.

Hower, Ralph M. History of Macy's New York, 1858–1919: Chapters in the Evolution of the Department Store. Cambridge, Mass.: Harvard University Press, 1943.

International Directory of Company Histories. Vols. 5, 30. Chicago: St. James Press, 1988, 1999.

JerryBrisco

See alsoDepartment Stores ; Leveraged Buyouts ; Retailing Industry .

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