Department store

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The interior of a typical Macy's department store.

A department store is a retail establishment which specializes in selling a wide range of products without a single predominant merchandise line. Department stores usually sell products including apparel, furniture, appliances, electronics, and additionally select other lines of products such as paint, hardware, toiletries, cosmetics, photographic equipment, jewellery, toys, and sporting goods. Certain department stores are further classified as discount department stores. Discount department stores commonly have central customer checkout areas, generally in the front area of the store. Department stores are usually part of a retail chain of many stores situated around a country or several countries.


[edit] History

The great Gostiny Dvor in St Petersburg, 1802.

Hudson's Bay Company in Canada was the first store to include departments; however, by modern standards, it would not be considered a department store because of the size and range of items that were stocked. The same may be said about Gostiny Dvor in St Petersburg, which opened in 1785 and should probably be regarded as one of the first purposely-built shopping malls in the world, as it consisted of more than 100 shops covering an area of over 53,000 m².

The first true department store was founded by Aristide Boucicaut in Paris. He founded Bon Marché in 1838, and by 1852 it offered a wide variety of goods in "departments" inside one building. Goods were sold at fixed prices, with guarantees allowing exchanges and refunds. By the end of the 19th century, Georges Dufayel, a French credit merchant, had served up to three million customers and was affiliated with La Samaritaine, a large French department store established in 1870 by a former Bon Marché executive.

The oldest independent department store in the world, until it was recently purchased by House of Fraser, was Jenners in Edinburgh, Scotland, which has maintained its original position on Edinburgh's Princes Street since 1838.

As Bon Marché evolved into a fully fledged department store in the early 1850s, Delany's New Mart opened in 1853 in Dublin, Ireland on Sackville Street (now O'Connell Street). What made Delany's different from most department stores of its time was its purpose-built nature; unlike others it had not evolved gradually from a smaller shop on site. Constructed to a lavish standard on the city's principal street, it was designed to rival the biggest and best in Europe. Acquired by the Clery family in the late 19th century, both the store and Imperial Hotel located in its upper floors were completely destroyed in the 1916 Easter Rising. However the store reopened in 1922, this time across numerous floors, as the famous Clerys department store that stands today, housed in a striking modern neoclassical building based on Selfridges of London.

Another claimant to the title of "World's first department store" is Bainbridges in Newcastle upon Tyne, founded in 1838 as a drapers and fashion shop but on record as collecting its takings by department as early as 1849. The ledger from that year still survives in the archives of the John Lewis Partnership who bought the store in 1952, and retained its original name until 2002 when the store was rebranded as John Lewis Newcastle.

In New York City in 1846, Alexander Turney Stewart established the "Marble Palace" on the east-Broadway, between Chambers and Reade streets. He offered European retail merchandise at fixed prices on a variety of dry goods, and advertised a policy of providing "free entrance" to all potential customers. Though it was clad in white marble to look like a Renaissance palazzo, the building's cast iron construction permitted large plate glass windows. In 1862 Stewart built a department store on a full city block at Broadway and 9th Street, opposite Grace Church, with eight floors and nineteen departments of dress goods and furnishing materials, carpets, glass and china, toys and sports equipment, ranged around a central glass-covered court. Within a couple of decades, New York's retail center had moved uptown, forming a stretch of retail shopping from "Marble Palace" that was called the "Ladies' Mile". In 1858 Rowland Hussey Macy founded Macy's as a dry goods store. Benjamin Altman and Lord & Taylor soon competed with Stewart as New York's first department stores, later followed by "McCreary's" and, in Brooklyn, "Abraham & Straus" (The Straus family would be in the management of both Macy's and A&S.

A Bon Marché department store in Paris, 1867.

Similar developments were under way in London (with Whiteleys), in Paris (with La Samaritaine) and in Chicago, where department stores sprang up along State Street, notably Marshall Field and Company, which remains the second-largest store in the world (after Macy's). In 1877, Wanamaker's opened in Philadelphia. Philadelphia's John Wanamaker performed a 19th century redevelopment to the former Pennsylvania Railroad terminal in that city and eventually opened a modern day department store in the building.

On March 1, 1869 Zion's Cooperative Mercantile Institution was opened in Salt Lake City as a new community store that became the first incorporated department store in America in 1870. A new 3-story brick and iron store was built in 1876, noted for its unique architecture and striped awnings. This store was replaced by an enclosed shopping center in 1973, and the new Zion department store preserved the gilt-edged ornate facade of the old store. In 1999 the May Department Stores bought a 14-store ZCMI chain and changed its name to "Meier & Frank", a May property with eight stores in Oregon and Washington. Subsequently May Department Stores completed a merger with Federated Department Stores and the Meier & Frank brand ZCMI stores have become Macy's stores, effective late 2006.

In 1881, Joseph Lowthian Hudson opened a small men's clothing store in Detroit. After 10 years he had 8 stores in the midwest and was the most profitable clothing retailer in the country. In 1893 he began construction of the immense department store at Gratiot and Farmer streets in Detroit. The 25-story tower was added in 1928, and a 12-story addition in 1946, giving the entire complex 49 acres of floor space. In 1954 the company became a suburban shopping center pioneer when it built Northland 13 miles northwest of Detroit. In 1969 it merged with the Dayton Corporation to create Dayton-Hudson headquartered in Minneapolis. George Dayton had founded his Dayton's Daylight store in Minneapolis in 1902 and the AMC cooperative in 1912, built the Southdale Shopping Center in 1956, and started the Target discount store chain in 1962. The new corporation closed the flagship Hudson department store in downtown Detroit in 1983, but expanded its other retail operations. It acquired Mervyn's in 1978, Marshall Field's in 1990, and renamed itself the Target Corporation in 2000.

By 1890 a new world of retailing had been created as department stores had a clear market position as universal providers. General stores eventually became department stores as small towns became cities. The most prominent department stores emerged from small shops. The department store created several of North America's first large businesses. The department store is also largely responsible for the standard store design seen today, because of its size it required new building materials, glass technology and new heating, amongst other architectural innovations. The store layouts made shopping easier for consumers regardless of their social or economic background. The department store also offered new customer services never before seen such as restaurants, restrooms, reading rooms, home delivery, wrapping services, store hours, new types of merchandise displays and so forth.

Image:David Jones Elizabeth St.jpg
David Jones department store building on the corner of Elizabeth Street and Market Street in Sydney.

Some department stores leased space to individual merchants, similar to the changes in late 17th-century London, but by 1900 the smaller merchants were purchased or eventually replaced by the larger companies. In this way they were very similar to our modern malls, where the property owner has no direct interest in the actual department store itself, other than to collect rent and provide utilities. Today only the most specialized departments are leased out, such as photography, photo finishing, automotive services or financial services. However, today this is rare, as most departments--even a store's restaurant--is usually run by the store itself.

Before the 1950s, the department store held an eminent place in both Canada and Australia, during both the Great Depression and World War II. Since then, they have suffered from strong competition from specialist stores. Most recently the competition has intensified with the advent of larger-scale superstores (Jones et al. 1994; Merrilees and Miller 1997). Competition was not the only reason for the department stores' weakening strength; the changing structure of cities also affected them. The compact and centralized 19th century city with its mass transit lines converging on the downtown was a perfect environment for department store growth. But as residents moved out of the downtown areas to the suburbs, the large, downtown department stores became inconvenient and lost business to the newer suburban shopping malls.

[edit] Discount department store

Image:Walmart exterior.jpg
A typical Wal-Mart discount department store.

The Fair Store Chicago, Discount Department Store, evolved over a number of years into a what may be the first discount department store, founded in the late 1800's. It states from it's founding the idea of selling for low prices, purchasing with cash. And starting the concept of odd prices, not ending in 5-cents. Founder Ernst J. Lehmann offered odd prices to save customers a few pennies on every purchase. I am not sure what year it could first be claimed a department store - in this case Discount Department Store. Link to 1891 completed Fair Store, Chicago. [1]

The Fair Store Chicago - was promoting itself as a Discount Department Store in the early 1900's in 1905. It states in 1915 in a booklet published by the store stated "The Fair Store is still, as it always has been and undoubtedly always will be, the store of the people, the down-town shopping center for the Savers, the market place for the Thrifty." In 1925 the stores were sold to Kmart founding chain S.S. Kresge. Then again to Montgomery Ward in 1957. [2]

1906 photo of The Fair Store: [3]

A discount store is a type of department store, which sell products at prices lower than those asked by traditional retail outlets. Most discount department stores offer wide assortments of goods; others specialize in such merchandise as jewelry, electronic equipment, or electrical appliances. Discount stores are not dollar stores, which sell goods at a dollar or less. Discount stores differ because they sell branded goods and prices vary widely between different products. Discount department stores are more popular in the United States than other countries. Following World War II, a number of retail establishments in the United States began to pursue a high-volume, low-profit strategy designed to attract price-conscious consumers.

During the period from the 1950s to the late-1980s, discount stores were more popular than the average supermarket or department store. There were hundreds of discount stores in operation, with their most successful period occurring during the mid-1960s in the United States with discount store chains such as Kmart, Zayre, Kuhn's-Big K (sold to Wal-Mart in 1981), GEM, TG&Y and Woolco (closed in 1983, part sold to Wal-Mart) amongst others. Currently, Wal-Mart, the largest retailer in the world, operates 1,353 discount stores in the United States; Target and Kmart are Wal-Mart's top competitors.

Examples of discount retail chain stores include Wal-Mart, Kmart and Target, all of which opened their first locations in 1962. Other retail companies branched out into the discount store business around this time as adjuncts to their older store concepts. As examples, Woolworth opened a Woolco chain; Montgomery Ward opened Jefferson Ward; Chicago-based Jewel launched Turn Style; and Central Indiana-based L.S. Ayres created Ayr-Way. These chains typically were either shut down or sold to a larger competitor during the late '70s and early '80s. Kmart and Target themselves are examples of adjuncts, although their growth prompted their respective parent companies to abandon their older concepts (the S.S. Kresge five and dime store disappeared, while the Dayton-Hudson Corporation eventually divested itself of its department store holdings and renamed itself Target Corporation).

Many of the major discounters are now opening "supercenters", which add a full-service grocery store to the traditional format. The Meijer chain in the Midwest consists entirely of supercenters, while Wal-Mart and Target have focused on the format as of the '90s as a key to their continued growth. Although discount stores and department stores have different retailing goals and different markets, a recent development in retailing is the "discount department store", such as Sears Essentials, which is a combination of the Kmart and Sears formats, following the companies' merger as Sears Holdings Corporation.

[edit] Countries

[edit] Argentina

Falabella is one of the most important department store in Argentina. It also has stores in Chile and Peru.

[edit] Australia

Although there were a number of department stores in Australia for much of the 20th Century, today Myer and David Jones, located nationally, are practically the national department stores duopoly in Australia. Other retail chain stores such as Target, Kmart and Big W, also located nationally, are considered to be Australia's discount department stores. Most department stores in Australia have their own credit card companies, each having their own benefits while the discount department stores do not have their own credit card rights.

[edit] China

Department stores first appeared in China at the beginning of the 20th Century, the concept said to be introduced by expatriate Chinese living in Australia. Before 1949, there were four main department stores in Shanghai: Wing On, Sincere, Sun Sun and Yat Sun; the first two still exist today.

During World War II patriotic sentiment in China had led to the formation of a number of department stores specializing in locally-made merchandise. This type of stores became the mainstay in China after the formation of the Communist state in 1949.

Both types of department stores have long had branches in Hong Kong; however Japanese department stores began to appear in the 1960s, and within a generation's time became the dominant force in the market. The Asian financial crisis of the late 1990s had resulted in the closures of some of these stores, but on the whole Hong Kong still has one of the world's most competitive retail markets.

[edit] El Salvador

  • Siman. The most important Department store Chain in Central America [citation needed].
  • Carrion.
  • Dorian's. Mexican Department stores present only in Mexico and El Salvador.

[edit] Finland

The most famous department store chains in Finland are Stockmann, privately owned by a family corporation, and Sokos, owned by a nationwide retailing cooperative. The Stockmann department store in central Helsinki is the biggest department store in the entire Nordic countries and a famous landmark of Helsinki.

[edit] France

France's major department stores are Galeries Lafayette and le Printemps, which both have flagship stores on Boulevard Haussmann in Paris and branches around the country. Part of the same group as Galeries Lafayette, the BHV (Bazar de l'Hotel de Ville) has a more mid-market clientele. The oldest department store in France (and maybe in the world) is still Le Bon Marché in Paris. La Samaritaine was bought by LVMH and closed in 2005.

[edit] Ireland

Originally the Republic of Ireland had two department stores, Clerys and Arnotts, the latter considered to be one of the five largest stores in Britain and Ireland. However several large retailers now own chains of department stores, such as:

The most upmarket chain is undoubtedly Brown Thomas, founded as a haberdasher's in 1849 on Dublin's Grafton Street. The company (which belongs to the same group as the UK's Selfridges or Canada's Holt Renfrew) bought its long time competitor across the street, Switzers, in 1995. BT then moved to the larger site. It also acquired and re-branded the former Switzer stores in Cork (formerly Cash's), Limerick (formerly Todd's) and Galway (formerly Moon's).

There are also many self-owned department stores around the country, especially in rural towns.

The British department store, Debenhams, has a Dublin city centre site within the Jervis Centre. The opening of the Dundrum Shopping Centre in Dublin's suburbs saw the arrival of two more British stores, House of Fraser and Harvey Nichols.

[edit] Germany

In Germany there are a number of department stores. There are two big department store companies, KarstadtQuelle (Karstadt and Hertie) and Kaufhof (part of the Metro AG). There are also some smaller independent department stores. Some department stores only sell clothing. The biggest clothing department store chain is C&A. Larger department stores in Germany usually contain a self-service restaurant, clothing departments, a toy department, a department for computer and electronics, a small book department (for bestsellers), a department for newspapers and magazines and a food department (like a supermarket).

One of the most famous department stores in Germany is the Kaufhaus des Westens (German for department store of the west) which is located in Berlin.

[edit] Mexico

Mexico has a number of department stores, many coming from other countries, such as the United States. However, some Mexican department stores exist and serve different income levels. Examples include Sears Mexico, Liverpool and El Palacio de Hierro.

[edit] Russia

Maybe the most famous Departement store in the world is the GUM in Moscow or the Petrovsky Passage. In Saint Petersburg there is The Passage extremely popular.

[edit] Spain

Spain is dominated by one department store chain, El Corte Inglés, founded in 1934. These stores tend to be vast buildings, selling a very broad range of products.

[edit] United Kingdom

All of the early department stores in London started out as small drapery stores which bought up neighbouring stores and increased their range of products.

Image:Harrods at night.jpg
The exterior of Harrods in London.

In Edinburgh, Jenners saw a similar development. It starting as a drapery store in 1838, which by 1890 had grown into Scotland's largest retail store by gobbling up all the small stores in the neighbourhood. In 1895, after a devastating fire, a new ultra-modern building opened, with lavish electrical lighting, hydraulic lifts and air conditioning. Four hours after the grand opening, 25,000 people had already visited the store.

In the UK the term "department store" still refers to the traditional, classic department store, which has a wide range of independent departments with their own staff and their own tills. Large discount stores with the tills located by the entrance are not regarded as department stores in the UK, although the owners may call them that.

[edit] United States

Image:Macy's at Town Center at Boca Raton.JPG
The exterior of a typical Macy's department store (formerly Burdines) at Town Center at Boca Raton located in Boca Raton, Florida.

In the United States, companies such as Macy's, Dillard's, Sears, and J.C. Penney are considered department stores, while retail brands such as Target, Kmart, and Wal-Mart are discount department stores. T.J. Maxx, Marshalls, and Burlington Coat Factory are stores that sell designer goods for less. Stores that carry a general line of groceries and other product lines similar to those of department stores are considered warehouse clubs or supercenters. Warehouse clubs require a nominal annual membership fee, while supercenters do not. Costco, BJ's Wholesale Club, and Sam's Club are examples of warehouse clubs.

[edit] Upscale Department Store

characteristics of an Upscale Department Store:

  • Sell brand name perfumes and Beauty supplies, like Burberry and Calvin Klein, and Nordstrom at the main entrance. And have specialist in cosmetics there to assist customers with applying and selecting make up.
  • Generally sells name brand clothes above an average price level, such as Dior, Chanel, Versace, LaCoste, etc.
  • When items are on sale, the price resembles that of a average priced item at a lower scale department store (Example: Jeans at Nordstrom usually are on sale for 80, which is an average price at Macy's)
  • may sell small household appliances like blenders

Some upscale department stores that operate in the United States include: Bloomingdale's, Saks Fifth Avenue, Nordstrom, Neiman Marcus, and Lord and Taylor.

[edit] Mid Range

characteristics of a Mid Range Department Store:

  • Sells cosmetics
  • Sells brand names and non name brands.
  • Sells accessories.
  • may sell small household appliances.
[edit] Comparison to upscale department store
  • sell cosmetics but generally not brand name. may sell brand name perfumes. Doesn't have perfumes and Beauty supplies at main entrance and doesn't have cosmetic specialist.
  • Doesn't sell upscale brand names.
  • Accessories and purse aren't upscale brand names and generally not even brand name.

Some mid range department stores that operate in the United States include: JC Penney, Kohl's, and Mervyn's. Sears is also in this category but is considered a more low-grade mid range department store due to the fact that is sells almost no brand names and has a more "Discount Department Store vibe because it sells power tools and may have a garden center.

[edit] Discount Department Store/ Super Store

  • Sells cosmetics, generally not name brand.
  • generally doesn't sell name brands.
  • Sells accessories, generally not name brand.
  • Sells small house hold appliances
  • Sells toys, electronics, and video games
  • more wide variety of products including house hold necessities.
  • Super stores usually sell food products and have a "one stop shop" vibe.
[edit] Comparison to Mid-Range Department Store
  • Doesn't sell brand names
  • Wide variety of products

Some mid range department stores that operate in the United States include: Kmart and Wal-Mart. Target is also in this category but is considered a more high-grade Discount Department Store due to the fact that is sells some brand beauty supplies, perfumes, and clothes. Also they have a higher quality in customer support and products.

[edit] Off-price retailer

  • Most products are named brand, liquidated, from other Department Stores
  • Liquidated products are "Last Session's" merchandise
  • Sells named brands for low prices.
  • Sells accessories for low prices
  • Sells more home brand things, usually not available in stores

Sells a lot of apparel things for low prices

Off-price retail department stores include T.J. Maxx, Ross Dress for Less, Marshalls, and Burlington Coat Factory. They sell named brands that was originally in department stores, but no longer in stock, for a low price.

[edit] See also

[edit] References

  • Abelson, Elaine S. When Ladies Go A-Thieving: Middle Class Shoplifters in the Victorian Department Store. New York: Oxford University Press, 1989.
  • Barth, Gunther. "The Department Store," in City People: The Rise of Modern City Culture in Nineteenth-Century America. New York: Oxford University Press, 1980.
  • Benson, Susan Porter. Counter Culture: Saleswomen, Managers and Customers in American Department Stores, 1890-1940. Urbana, IL: University of Illinois Press, 1988. ISBN 0-252-06013-X.
  • Ershkowicz, Herbert. John Wanamaker, Philadelphia Merchant. New York: DaCapo Press, 1999.
  • Gibbons, Herbert Adams. John Wanamaker. New York: Harper & Row, 1926.
  • Hendrickson, Robert. The Grand Emporiums: The Illustrated History of America's Great Department Stores. New York: Stein and Day, 1979.
  • Leach, William. Land of Desire: Merchants, Power, and the Rise of a New American Culture. New York: Pantheon, 1993. ISBN 0-679-75411-3.
  • Parker, K. (2003). "Sign Consumption in the 19th-Century Department Store: An Examination of Visual Merchandising in the Grand Emporiums (1846 – 1900)." Journal of Sociology 39 (4): 353–371.
  • Schlereth, Thomas J. Victorian America: Transformations in Everyday Life, 1876-1915. New York: HarperCollins, 1991.
  • Sobel, Robert. "John Wanamaker: The Triumph of Content Over Form," in The Entrepreneurs: Explorations Within the American Business Tradition New York: Weybright & Talley, 1974). ISBN 0-679-40064-8.
  • Spang, Rebecca L. The Invention of the Restaurant: Paris and Modern Gastronomic Culture. Cambridge, Mass.: Harvard University Press, 2000. 325 p.
  • Whitaker, Jan. Service and Style: How the American Department Store Fashioned the Middle Class. New York: St. Martin's Press, 2006. ISBN 0-312-32635-1.

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