THE ROW ABOUT HENRY FORD'S GROCERY STORES
A NATION-WIDE BOYCOTT against Henry Ford's tractors and automobiles was being planned by Detroit and other retail storekeepers, say dispatches from the Michigan city, because the manufacturer, in an attempt to reduce the cost of living to his thousands of employees, had established markets and stores for them near the three Detroit plants, where goods of all sorts are sold at prices far below the retail price, and in many cases considerably below the wholesale cost of the goods to the ordinary merchant.
This was a new kind of "company store," run for the benefit of the employees, rather than the company, altho it is said to have made a profit of 3 1/2 per cent. The butcher and baker and candlestick makers of Detroit could find no fault with the Ford stores in the beginning. But five months ago, when it became virtually impossible to prevent Ford employees from loaning their identification. badges to their numerous friends, the stores were opened to the general public. Then came the deluge—of telegrams, committees of protest, and the launching of a boycott campaign. Protests and threats to boycott Ford cars are said to have come from as far west as Seattle and as far south as Missouri.
This was the situation on April 4. People in every section of the country, no doubt, were wishing they lived in Detroit, so that they could take advantage of the low prices of Henry Ford, grocer. Or that some local Croesus would emulate the Detroit manufacturer in their home town. The coal dealers, meat markets, and grocery stores the country over, on the other hand, probably were wondering what would happen to them if such a miracle should come to pass. It was in Detroit, however, that the situation was acute. The recently organized Michigan Retail Merchants Association therefore called a meeting of protest. For two hours the retail merchants listened to speeches criticizing the Ford merchandising policy. Then a quiet mannered young man got up and announced that the Ford stores would be closed to the public! The meeting adjourned.
The story of the Ford stores is thus told by Orville Dwyer in a Detroit dispatch to the Chicago Tribune:
"Mr. Ford's reason for opening these stores, it is said, was to stop profiteering on his employees. When he started to pay his employees not less than $5 a day, a high wage for that time, the merchants in the vicinity took advantage of it, it is charged, and boosted their prices. The auto maker then opened the stores to help his employees.
"But there arose a traffic in the badges he issued to his employees authorizing them to buy. Some employees loaned their badges to their friends. Various schemes to limit the stores to Ford employees were tried. None of them was entirely successful. Finally the doors were opened to the public."
According to an Associated Press dispatch, persons dealing at the Ford markets declare that they purchase at from 10 to 40 per cent. under the prevailing retail prices. Not even chain-grocery or department stores can compete with the Ford stores, this correspondent adds. In the Baltimore Sun we find the following explanation by W.A. S. Douglass:
"The store at Highland Park, for example, occupies two floors in a corner of the huge plant. The entrances and exits are plainly marked and the wicket system is used. As one enters, the checker hands one a purchase slip of three pages. On this the salesman or salesgirl marks the purchases. Before one leaves one must pass the pay desks, a series of grills, with one's packages. Here the bill is receipted.
"The methods that have made Mr. Ford the world's richest man are followed closely in the conduct of his stores. No waste motion, no waste space, no frills or flounces, no servility—and no civility. You come there to buy cheap and to get good stuff.
"Altho the Highland Park store was visited early on a weekday morning, its aisles were crowded as on Saturday in a department store. Everybody—men, women and children—carried bags. Into these they would drop their purchases and move along to the next counters.
"The meats are of the very best. Steak-cutting machines, chop-slicing machines, machines for dividing a steer into standard food portions, abound in this mass production butcher shop. Back of the counters, where canned goods, bread and vegetables are sold, are great open bins stacked with these foods. On the second floor is the shoe shop.
"Outside, cars are lined two deep. Ford automobiles are in the majority. But one sees more than a few fur coats enveloping prudent, tho well-to-do, housekeepers whom one might class as snappy looking folk of the Buick standard. And, slinking around with bags in their hands, are seen liveried chauffeurs doing buying errands for their mistresses. Thus showing that even a Packard outlook is not too haughty to overlook a Ford economy."
Whether the Ford example of the company store, operating at a small profit and serving the public, will be followed by other manufacturers is doubtful, we are told, now that the Ford stores have been closed to the public. Nevertheless, we are reminded by the New York World, "you can not but admire the efficiency with which the job is done. A workman is able to buy necessities at very greatly reduced prices. And that, of course, is a good thing." As the Brooklyn Eagle observes: "It is the nature of the American to get the most for his money."
On the other hand, writes M. E. Tracy in the Washington News, "while the idea of getting things cheap is fine, if kept within reasonable bounds, the idea of live and let live is the real basis of prosperity." In the opinion of the Schenectady Union-Star, "it is an open question whether it is an undiluted benefit to the public to drive the small dealer out of business. A basic low-price store is valuable in a community to correct prices in Other establishments, but it is a question whether the benefits from the Ford plan would have offset the bad effects of a string of bankruptcies." In the opinion of the Boston Post:
"There is nothing new in the Ford scheme. It has always been feasible, but hardly wise on a nation-wide scale. There are a great many thousand persons whose living depends upon the very lines of business that would be undermined by a wide-spread application of the Ford idea of merchandising. Handling standard goods in large quantities, buying and selling for cash, giving the bare necessities of service, refusing to stock anything but articles which can be quickly turned over, he can sell at surprizingly low prices. But he skims the cream, leaving the skimmed milk for other merchants who make it possible for thousands of people to make a living—and buy Ford cars.
"American business has been built up on the principle of give and take. A tremendous proportion of all money taken in by business is poured out again in wages. A job-creating business is the one big asset of any community. The Ford idea is a job-destroying business."
"For our part," avers a Providence News editorial writer:
"We are glad that we can still trade with a corner grocer who knows us by name and knows the kids when we send them up on an errand; who is always ready to agree with our profound observations on the weather; who can be depended upon for a little credit just before pay day; who knows the cut of steak we like and how we want our coffee ground; who retains, in short, the semblance and manner of a human being. And we are glad to pay a few extra pennies by way of protest against the encroachments of a mechanized civilization."
Out in Missouri, the Kansas City Star also has "a word to say for that noble old institution, the corner grocery store":
"Around the old corner grocery store our cities were built, our settlements were established, our country was developed, and our civilization expanded. That is the way Kansas City began. Wichita sprang from the little old grocery store that was started down by the Chisholm trail. Topeka had its beginning in a log cabin grocery.
"The chief purpose in the life of the old corner grocery store was to supply the town with sugar, salt, coffee, smoking tobacco, and canned goods.
"The storekeeper opened his store at six in the morning, to provide a half-dozen eggs, on credit, for a forgetful housekeeper. He kept the store open until ten o'clock at night to provide a public forum for the town's oratorical statesmen who desired to discuss national issues. He was the most faithful public servant this department now recalls. It can not believe that now he is to be shoved off the gang-plank into the turbulent sea of modern business conditions."
Source: The Literary Digest for April 16, 1927