Dime Stores, or five-and-dimes, maintained a central place in American life from before 1900 until after World War II. Woolworth's was the original and dominant dime-store chain. In the first half of the twentieth century, the main street of virtually every town and city in the United States featured a Woolworth's; it was the first place many people went to look for basic merchandise of all sorts. Woolworth's offered its customers a wide assortment of very affordable household items and the working class appreciated finding basic things at basic prices. The dime store's lunch counter was a common meeting place, its toys made it a favorite destination of children, and its endless locations meant it served as the neighborhood store for many. Although part of Woolworth's appeal was in its ubiquitous presence, local stores were also encouraged to remain local institutions. They varied widely from region to region and from city to town. Each filled a particular role and developed its own character.
In 1919, when F. W. Woolworth died, his chain of five-and-dimes consisted of 1,081 stores in the United States and Canada. At that time, department stores were all regional; Woolworth's was one of a very few nationwide chains. Department stores were also notably more lavish and expensive than dime stores. Millions of working people depended on Woolworth's and other five-and-dimes for many basic needs. As the nation's largest food-service retailer by the 1940s, Woolworth's maintained nearly a thousand inexpensive lunch counters across the United States before the first McDonald's opened.
Before Woolworth, shopping meant bartering. Merchandise was kept behind counters or on inaccessible shelves and customers had to ask clerks to show them an item. Fixed pricing had begun appearing in a few places, notably Michigan, in the 1870s, but was sporadic and unorganized. Other merchants had set up five-cent counters from time to time for limited runs, but no one had worked hard to make it consistently profitable, and certainly no one had devoted an entire variety store to the same fixed price. Frank Woolworth was not a natural salesman or bargainer, but he held a strong Yankee work ethic and recognized and exploited a good idea. He assiduously sharpened his bargaining skills until he became known for them. They helped him negotiate endless deals with wholesalers which allowed Woolworth's to make a profit on items under 10¢.
He had opened his first "5¢ store" in Utica, New York, on February 22, 1879, with $350 loaned him by his former employer. That first store barely turned a profit, but it spawned twenty more over the next ten years, twelve of which were partnerships and five of which failed within a few months. His fourth store, opened in Scranton, Pennsylvania, on November 6, 1880, was the first "5-&-10¢ store." Frank Woolworth never stopped opening or buying new stores: he ran twelve in 1890, fifty-four in 1900, two hundred thirty-eight in 1910, and three hundred nineteen by the December 1911 merger that created F. W. Woolworth & Co. Combined with his brother Charles's fifteen stores, his cousin Seymour Knox's ninety-eight, Fred Kirby's ninety-six, Earle Charlton's thirty-five, and William Moore's two, Woolworth became the first retail company to operate stores in all forty-eight states. As he planned for the merger that created F. W. Woolworth & Co., Frank Woolworth also oversaw the construction of the Woolworth Building in Manhattan. The tallest building in the world at the time of its completion in 1913, Woolworth insisted that it surpass the Metropolitan Life Building, which company had refused him a policy when he was laying the foundation for his empire.
Frank Woolworth said that he aimed "to open a store in every civilized town throughout the world." He expanded into England in 1909, then Germany, Canada, South Africa, and elsewhere. Woolworth's critics complained that Woolworth's was creating a monopoly and Congressman John J. Cochran championed legislation that would have taxed Woolworth's into collapse. Many people were dismayed by "the chain store menace" of Woolworth's in the 1930s, just as many recoiled when Wal-Mart built stores in their communities in the 1980s and 1990s. In 1935 Representative Cochran led a congressional investigation into the "super-lobby" of chain store interests. Woolworth's and drug-store chain A&P were the primary targets. Fortunately for the chains, a 1939 bill that would have broken them up died in committee. Woolworth's did indeed try to drive out or buy out much of its competition. The company knew that many of the towns and districts where they opened could not support more than one dime store.
Woolworth's remained literally a dime store for over fifty years, until 1932, when the top price was raised to 20¢. In 1935 the limited price policy ended as the company expanded into higher-priced merchandise such as furniture and appliances. Despite fixed, low prices, Woolworth paid better wages than most of his competitors. He introduced minimum wages for all positions, paid vacations, and Christmas bonuses. These things were far from standard early in the twentieth century. Woolworth's was also a major employer of women, although by the 1950s many were protesting their lack of promotion in the company.
Woolworth's lunch counters will be long remembered as the site of civil-rights sit-ins in 1960. The first one began at the Woolworth's in Greenville, North Carolina, on February 1, 1960. Soon protesters throughout the South were occupying lunch counters and calling for a nationwide boycott against Woolworth's. The company's earnings dropped 8.9 percent in March. Many cities integrated their restaurants after a few weeks, but Greenville endured sit-ins and demonstrations until July 25.
Woolworth's perfectly filled a key place in American culture in the first half of the twentieth century, but as the culture changed after World War II, Woolworth's importance waned. As other chains emulated Woolworth's low-cost approach, it became little more than another department store. The 2,850 Woolworth's stores of the early 1960s sold enormous quantities of merchandise, but held onto a very thin profit margin.
In the postwar era, Woolworth's seemed stale and staid; its workforce aged with its clientele as it failed to change with the times. A succession of company-trained presidents found it impossible to halt the gradual decline. The last 400 Woolworth's in North America were closed in 1997 and 1998. Woolworth's survives in the United States as Venator, a corporation consisting primarily of Footlocker athletic shoe stores. In Great Britain and Australia Woolworth's remains a major variety and, in Australia, grocery chain.
Yet the legacy of the dime store thrives in the myriad discount department stores throughout the world, in the many "dollar stores" now occupying the neighborhood malls that have taken the place of downtown shopping districts, and in the merchandise purchasing, display, and pricing policies that have become standards of modern commerce.
Brough, James. The Woolworths. New York, McGraw-Hill, 1982.
Raucher, Alan R. "Dime Store Chains: The Making of Organization Men, 1880-1940." Business History Review. 1991, volume 65:1.
Winkler, John K. Five and Ten. New York, Robert McBride &Co, 1940.
Wolff, Miles. Lunch at the 5 & 10. Revised and expanded edition.Chicago, Ivan R. Dee, 1990.