Intro/Outro (00:12):
Good morning, Scott Luton here with you on this edition of this week in business history. Welcome to today’s show on this program, which is part of the supply chain. Now family of programming. We take a look back at the upcoming week, and then we share some of the most relevant events and milestones from years past, of course, mostly business focused with a little dab global supply chain. And occasionally we might just throw in a good story outside of our primary realm. So I invite you to join me on this. Look back in history, to identify some of the most significant leaders, companies, innovations, and perhaps lessons learned in our collective business journey. Now let’s dive in to this week in business history,
Kelly Barner (01:14):
Let’s play an association game. I’m gonna give you a company name and you blurt out the first thing that comes to mind. Don’t worry about those people around you they’ll understand ready? Okay, let’s go. Macy’s now I’m betting that many of you said or thought things like parade New York or department store. And of course you wouldn’t be wrong, but for all of those and the many other things that may have come to mind, I’m willing to bet that the following weren’t among them tattoo, Haal Massachusetts and Benjamin Franklin. And yet all of those are closely tied to the person whose story I am going to share today. Roland Hui, Macy, the founder of Macy’s department stores. I’m Kelly Barner your host for this episode of this week in business history, on supply chain now, and I love history. I’m a proud Bostonian, and it’s hard to be a lover of history and grow up in Boston and not feel like you’ve been given a bit of an edge.
Kelly Barner (02:27):
As far as I’m concerned, we invented American history. And yet I’ll be honest that I had no idea. The founder of Macy’s was from Massachusetts. If you enjoy the unique blend of storytelling and business history that Scott Luton and I share on this week in business history, please take a minute to subscribe to the podcast and share a review that will help others find us with that said, let’s get back to this week’s business history story. The founding of Macy’s Roland H Macy was born on August 30th, 1822 on the island of Nantucket, the smaller and further away of Massachusetts’ most noteworthy islands as an exclusive as Martha’s vineyard or the vineyard is Nantucket is a whole other step up. Nantucket actually means far away land in the language of the native Wampanoags. But in the early 19th century, there wasn’t much going on there besides wailing at the time, Nantucket was the home to more millionaires than any other part of the country.
Kelly Barner (03:39):
Roland Macy’s father was a Whaler. And so he was a Whaler as well. Wheeling is the industry that gave RH Macy his start, and that gave the future Macy’s chain its brand identity. Macy’s got its single red star logo from a tattoo he had on his arm. R Macy’s sailed as part of the crew of the whaling ship. Emily Morgan, after he turned 15 and he got the tattoo on one of those voyages while Macy’s didn’t incorporate the star into their branding until 1949, it is generally accepted that his tattoo was the inspiration. Wailing also gave Macy his first opportunity to earn money. He earned about $550 on his first voyage, the equivalent of $13,000 today. That might not sound too bad, especially for 1840, but keep in mind that the typical wailing voyage was six months long. Macy was disappointed in his wages. And so at age 19, he decided to move to Boston and become printer’s apprentice.
Kelly Barner (04:52):
He had read about Benjamin Franklin’s success and wanted to model his own career after the founding father. Interestingly, Ben Franklin is actually in Macy’s family tree, but then again, so are John Lithgow, Humphrey Bogart, Kevin bacon, Linda Hamilton, Raquel Welch, and Kira Sedgwick. Despite the blood relationship between Franklin and Macy printing wasn’t in his DNA like retailing was. And yet how does a boy from Nantucket end up as the founder of a major metropolitan department store retailing was in his blood or being more appropriate for the era. Dry Gooding was in his blood. His father ran a store on Nantucket that he had worked in growing up. And then in 1844, Macy opened a needle and thread store in Boston, four years later in 1848, the gold rush began. Macy became one of the hundreds of thousands of people who headed west to make their fortune.
Kelly Barner (05:59):
And he was among the smartest. He didn’t plan to make his gold by mining or luck. He planned to do what he knew best and open a store to make money off the miners Macy and his brother Charles opened a dry good store in 1849 in Marysville, California. And it failed. Charles stayed in California after that, but Roland headed back east, despite the store’s failure in California, Macy stayed at it. Opening four retail, dry good stores between 1843 and 1855. One of them was the first store that would bear the Macy’s name and it was based in Haal Massachusetts. Now I wanna pause here quickly for a Massachusetts speech lesson. Wait, don’t laugh. Why are you laughing? Haver is spelled H a V E R H I L L, but please don’t say haver hill. That is not the way you say it. Spelling and pronunciation have almost nothing to do with each other when you’re in Massachusetts.
Kelly Barner (07:07):
It is what it is. Next time we’ll do Wooster. Now Haal was a Milltown with the Meramac river, providing much of the power needed to operate their hydro powered machines. Haverill was home to Woollen mills, tanneries shipping and ship building. And by the end of 19 13, 1 in 10 pairs of shoes produced in the entire United States came from the city. That also meant there were lots of people who needed dry goods and Macy plan to supply them. And yet this store like the other three, he opened during that same window of time failed all four of them. And so Macy took the only logical next step. He went to New York. Macy opened his first New York city location at the quarter of sixth avenue and 14th street. Macy’s didn’t move to their iconic 34th street location. Also known as Harold square until 19 0 2, 25 years after he passed away, that location has over a million square feet and it is the largest store in the world.
Kelly Barner (08:20):
Macy’s first day of business in New York was October 28th, 1858, sales totaled $11 and 8 cents equal to about $350 today. But that is par for the course. If you don’t believe me, go back and listen to my this weekend business history episode about John Wannamaker, the man who literally invented department stores. He got off to a slow start in Philadelphia, just like RH. Macy got off to a slow start in New York city, but Macy’s lock was about change. According to success.com Macy’s New York location ended up having between 85 and $90,000 in sales in its first year. Even with looming recession, like wanna makers, Macy’s expanded into neighboring buildings. As the business grew opening up more and more departments. He was personally involved in the use of Santa Claus themed exhibits and illuminated window displays as publicity tactics. As an aside, the RH Macy character featured in the 1947 movie miracle on 34th street was a portrayal that depicted him as alive and still running the company 70 years after his death in real life.
Kelly Barner (09:43):
Back in his actual timeline, things were really looking up bit by bit more customers started to roll in and they kept coming back for multiple reasons. According to business, insider.com Macy’s was one of the first stores to print the price of goods in their newspaper ads and offer money back guarantees. If customers were unsatisfied with their purchases, Macy also introduced innovations like tea bags, Idaho baked potatoes and colorful bath towels to the New York city market. In the 1860s, Macy’s became the first retail store to get a liquor license and serve beverages on site, which may have had something to do with customer loyalty. Macy’s became the largest department store in the world in 1924. The same year they ran the first Thanksgiving parade. Macy’s also offered its own made to measure clothing line for both men and women. And the orders were assembled in an onsite factory. In 1875, Macy took on two partners, Robert Valentine able the forge two years later, he would pass away from Bright’s disease, an older way of describing kidney disease while in Paris, France, by the time Roland H Macy died, his store had grown to occupy 11 connected buildings on 13th and 14th streets in New York city. And his net worth was $1.5 million.
Kelly Barner (11:25):
Let’s talk about his retail legacy. The last few years have not been kind to retailers in 1994. Macy’s merged with federated department stores, a company that also owns Bloomingdale’s in February of 2020, just before the pandemic hit. Macy’s had 680 stores, including their blooming deals locations. The company had just laid off 2000 employees and closed 125 stores. As of early 2022. Macy’s had about 500 locations open. And yet as our supply chain listeners will know, business size is no longer tied to bricks and mortar locations and footprint Macy’s is an omnichannel retailer, meaning that they have physical stores as well as an internet or direct to consumer presence. They employed a chief supply chain officer Dennis Mahe for the first time in 2020. And he has spoken about the investment that the company is making in digital supply chain transformation lik is responsible for sourcing inventory management and analytics, transportation, distribution, and operations, procurement and sustainability Macy’s plan was to transition from two separate warehouse networks where one serves stores in the other supports e-commerce sales to one centralized network.
Kelly Barner (12:59):
Their plan was expected to save 900 million by this year. An earnings report is expected on August 23rd. After this episode is recorded. So we’ll all have to check and see how that expectation aligned with the actual report. Regardless, a retail chain that got its start from a guy tough enough to be a Whaler on Nantucket, hopeful enough to tie his fortunes to the gold rush and brave enough to keep getting back up and trying again and again, despite consecutive failures should have what it takes to make it through this period of challenge and change after all they are the only retail chain I know of that has a tattoo on its arm nationwide.
Kelly Barner (13:51):
On that note, it is time to wrap up this edition of this week in business history. Thank you so much for tuning into the show each week. Don’t forget to check out the wide variety of industry thought leadership available@supplychainnow.com as a friendly reminder, you can find this week in business history, wherever you get your podcasts from and be sure to tell us what you think we would love to earn your review. And we encourage you to subscribe so that you never miss an episode on behalf of the entire team here at this week in business history and supply chain. Now this is Kelly Barner wishing you all, nothing but the best. We’ll see you here next time on this week in business history,
