CHAIN STORE GUIDE THROUGH THE AGES

A TOUR OF THE RETAIL & FOODSERVICE INDUSTRIES THROUGH THE LAST 80 YEARS.

In 2013, Chain Store Guide celebrated its 80th anniversary. In honor of this occasion, we hosted a monthly series of editorials called “Chain Store Guide Through The Ages”, starting with the 1930s, the decade in which CSG was founded. Each month we took a look at a different decade and reviewed what happened in that time and how it affected the industries we now serve.

Though we started off printing paper directories, our delivery of essential business sales leads has evolved into a robust and powerful online database system used by many of the top Fortune 500 companies as well as mid to small companies who want to grow their business.

Editorial Staff Apparel & Department - Natasha Perry Drug & Grocery - Brian List Home, Hardware, & Discount - Arthur Rosenberg Restaurant - Linda Helman Editing & Introduction - Matthew Werhner

This eBook can also be found indexed by decade online at newsroom.chainstoreguide.com.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Apparel Industry The Apparel Industry

1930s

The apparel industry in the 1930’s was very different than it is now. With more Army and Navy goods stores than traditional department stores, apparel was more about need than fashion. There were more than 50 percent fewer Women’s stores than Men’s stores. There were also more locations that were independently owned than operated by chains. Independents, or companies with 3 stores or fewer dominated the family apparel industry, operating 89 percent of the locations. To put annual sales in the 1930’s into perspective, the entire apparel group did around $4 billion in sales, which is what Abercrombie & Fitch brought in last year alone.

Rainbow Apparel Co., which currently operates 1,100 locations was started in the 1930’s. So was women’s apparel retailer Deb Shops Inc. and sporting goods retailers Dunham’s Athleisure Corp. and Recreational Equipment Inc. (REI). The decade also brought us women’s apparel retailer Maurice’s which spent the early years of this century acquiring Dressbarn and Justice and becoming Ascena Retail Group Inc.

1940s

As Europe, and later America, entered World War II, fashion responded. Drabness and uniformity in clothing were embraced, and people were encouraged to make do with the clothing they already had. During the war, all types of cloth were needed for a variety of wartime purposes, and material for clothing was severely rationed. The United States government had requisitioned all silk supplies, forcing the hosiery industry to completely switch to nylon. Then in 1942 the government requisitioned all nylon for parachutes and other war uses, leaving only the unpopular cotton and rayon stockings. As people found ways to make-do, the 1940’s saw the first widespread use of man-made fibers.

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Due to the limited materials, fashions of the era emphasized shorter skirts than ever before and short, blocky jackets. The most characteristic North American fashion trend from the 1930’s to the end of World War II was attention at the shoulder, with butterfly sleeves and banjo sleeves, and exaggerated shoulder pads for both men and women by the 1940’s. Another notable fashion trend for women in this period was the introduction of the ensemble, a matching dress or skirt and coat.

Despite the woes of the war, some big brands managed to jumpstart in the 1940’s. Coach was established in 1941. The Cato Corporation, Talbots and The Buckle Inc. were all started in the mid-1940’s. Hibbett Sports was founded in 1945, and Dick’s Sporting Goods in 1948. The most surprising was Fredericks of Hollywood, which would soon introduce the world’s first push-up bra.

1950s

By the early 1950’s, designers had grown tired of the utilitarian, minimalist clothing of the wartime era. Square shoulders and short skirts were replaced by the soft femininity of longer skirts, fitted waistlines, and rounded shoulders. Innovations in textile technology following WWII resulted in new synthetic fabrics and easy-care fabric finishes. These fit the suburban lifestyle of the 1950’s with its emphasis on casual sportswear for both men and women. Acrylic, polyester, triacetate and spandex were all introduced in the 1950’s.

Although critics complained about the extravagance of clothing while rationing was still mandated, women throughout the country demanded the revitalized femininity of a new look. Longing for elegance and luxury, garments were often lined with luxurious, expensive fabrics. Decorative accessories became necessary items.

Due to the baby boom, there was a high demand for clothing for children. Children’s clothing began to be made to a higher quality, and some even adopted trends popular with teenagers. Boys started wearing jeans to school and girls’ dresses were styled after those of the older women.

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Prior to 1960, designers generally created styles for runways, and clothing manufacturers mass produced the designers’ styles for the general public. However, during the 1960s youth throughout the Western world began to rebel against traditional clothing styles and create their own trends. Soon, fashion designers and manufacturers were frantically trying to keep up with the trends and implement the youths’ popular creations into clothing for the masses.

The bikini came into fashion in 1963. In the middle of the decade people were dressing in psychedelic prints, highlighter colors, and mismatched patterns. Mini- skirts and go-go boots were made popular. By the end of the decade the hippie look was in style. Both men and women wore frayed bell-bottomed jeans, tie-dyed shirts and headbands.

Hundreds of apparel and footwear retailers and department store companies got their start in the 1960’s. Kohl’s Corporation was founded in 1962 and Dillard’s Inc. in 1964. Top retailers The TJX Companies Inc., Limited Brands, and Gap Inc. were also established in the swinging sixties.

1970s

The 1970’s began with a continuation of the hippie look from the 1960’s including bell bottoms, miniskirts, hot pants and blue jeans. During the 1970’s a large variety of clothing became popular. It was normal for women to wear pants on a daily basis. In fact, many of the styles of the decade were androgynous. Another trend for both sexes was the fitted blazer, which flared slightly at the hip. It came in a variety of fabrics, including wool, velvet, suede, and leather.

1970’s fashion included platform shoes which appeared on the fashion scene in 1971 and often had soles two to four inches thick. Both men and women wore platform shoes. Wide-legged or flared jeans and trousers were another fashion mainstay. The disco look was popular and included three-piece suits for men and rayon or jersey wrap dresses for women. By the mid-1970’s hip-huggers were gone and were replaced by the high-waist jeans and trousers with wide flared legs. These lasted until the end of the decade when the straight cigarette-leg jeans came into style.

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Several top companies were founded in the 1970’s. Top men’s apparel specialty retailers The Men’s Wearhouse and Destination XL Group Inc. were founded in 1973 and 1976, respectively. Top women’s retailers Bebe Stores, Body Central, Bon Worth, Cache, Charlotte Russe, Dots and Victoria’s Secret all started in the early to mid-1970’s. Family apparel stores starting in the decade include American Eagle, Burlington Coat Factory, Fifth & Pacific Cos., Rue 21, The Marmaxx Group and Urban Outfitters Inc.

1980s

While high fashion had declined during the 1960’s and 1970’s, the 1980’s saw a rise in the popularity of designer styles. Wealthy people across the country made their way to New York boutiques and Paris fashion shows to purchase directly from designers’ lines. Mass producers replicated the high fashions for the general public and department stores specialized in selling them.

Power and money dominated the styles of the 1980’s. Women wore expensive suits and dresses during the day and extravagant designer gowns in the evening. Brand names became increasingly important in this decade, making Ralph Lauren and Calvin Klein household names, among others. Designer jewelry, such as diamonds and pearls were popular among many women, not only for beauty but as symbols of wealth and power.

Ross Stores debuted in this decade to serve as an outlet for designer brands. Tween Brands got its start in the late 1980’s as Limited too stores introduced designer styles for girls. Top brands such as Aeropostale, BCBG, Express, Guess, J. Crew, J. Jill and Tommy Hilfiger were founded in the 1980’s.

1990s

The range of fashion goods available in the 1990’s was huge. The main focus of fashion was the striving to achieve individuality. After the consuming years of the 1980’s, less became more in the 1990’s. The designer styles of the 1980’s were rejected in exchange for more comfortable, casual clothing.

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Flannel shirts and ripped jeans were considered grunge fashion inspired by the new popular style of music. The rising hip-hop movement brought baggy pants into fashion. Comfort remained the key factor in clothing choice for most in the 1990’s. Standards for work relaxed, and casual dresses and pants became popular workplace attire. We can thank the naughty nineties for acid-washed jeans, parachute pants, and the mullet.

Notable brands such as Cotton On, Lululemon, Lucy Activewear, Tommy Bahama, Under Armour and Vineyard Vines got their starts in the 1990’s. Leading shoe retailer DWS Inc. started selling footwear in 1991. Top family retailer Old Navy was founded by Gap Inc. in 1994.

2000s

Expensive designer clothing was still sought after by some, however, casual and comfortable clothing styles at reasonable prices were the popular choice at the start of the new century. The fashion trends of the 2000’s saw the fusion of previous styles. For the most part, the mid-late 2000’s did not have one particular style but recycled vintage clothing styles from the 1940’s, 1950’s, 1960’s and 1980’s.

Despite the numerous and mixed fashion trends of the 2000’s, items of clothing which were popular throughout the decade include Ugg boots, hoodies, high-tops, and skinny jeans. The decade also brought eco-friendly and ethical clothing, such as recycled fashions and fake fur. As with any other time period, you just never know what new trendy or outrageous style will emerge next on the fashion scene.

True Religion Brand Jeans, which now has 150 stores, got their start in 2002. The clog craze began the same year when Crocs introduced a new kind of comfort. Accessory retailer Charming Charlie has only been around since 2004, and with well over 200 stores the company expects rapid growth to continue. Ascena Retail Group Inc. was formed in 2011 and is now the parent company of women’s apparel retailers Charming Shoppes, Dress Barn and Maurices, and tween retail chain Justice.

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2010s & Beyond

It’s a given that people will continue to wear and buy apparel and footwear, but the way they buy it will change. Many retailers will focus more on their e-commerce business, and will maintain a lower inventory at its brick and mortar locations. Manufacturers, who once used outlet stores to sell last season’s merchandise, will continue to see higher growth using the internet.

More consumers will make purchases online, and many will even create their own unique products. The footwear industry introduced the create-your-own concept, but custom-made apparel and accessories are sure to be a hit as well. As customers are using new devices, top retailers will adapt to their shopping habits creating new apps and services for the technology driven consumers.

Apparel Specialty Store Sales Leads Database

Contact the Buyers & Top Executives in the industry leading apparel chains. • 5,600* Apparel Specialty Retailers • 16,100* Buyers and Decision Makers • 8,800* Personal Email Addresses (Plus Version) *Counts are approximate and subject to change.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Discount Retailer Industry The Discount Retailer Industry

1930s

One might think that during a tumultuous time like The Great Depression, discount stores would have been in great demand. Unfortunately the births of Walmart, Target and Kmart were three decades off. At this time, variety stores were all the rage typified by the five and ten cent concept embodied byWoolworth stores.

Founded in 1879, Woolworths actually were the discount stores of their day. They sold discounted general merchandise mostly at the much publicized set prices of five or ten cents which essentially became their moniker and brand.This proved to be a great merchandising aid as tough times such as the depression hit, as consumers knew how far their limited funds could carry them. In a sense this concept was the precursor to the single priced dollar store, such as Dollar Tree, which was five decades from creation.

International in scope, Woolworths also was somewhat of a forbearer to the McDonald’s type of branding in offering product to travelers who seek consistency in quality and price as they arrive at locations unknown. In the case of Woolworths, their stores were the recipient of even international travelers who sought familiar fare when far away from home. This was especially true of their lunch counters which were magnets for the hungry and thirsty whether seeking a meal, a hearty snack or refreshments.

Across the seventeen files that make up Chain Store Guide’s database of Discount Stores & Specialty Retailers 168 were founded during the decade we term the The Threadbare Thirties. Some of the more prominent retailers included on this prestigious list include the Hewlett-Packard Company, Harry & David and Meijer Inc., as a single unit grocer, seen as an answer to some of the woes of the Great Depression. The big box food and general merchandise/discount concept was initiated nearly thirty years later under the trade name Thrifty Acres. At the very end of the decade, in 1939, Dollar General was founded, a true sign of the times and a harbinger of future consumer buying trends.

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Of the 229 companies currently listed in CSG’s database which were founded during this decade, 53 were founded prior to 1945, 31 were founded during 1945 and 145 were created after 1945 and the completion of the war.

Interestingly, one of the retailers founded during the war, in 1943 was Jo-Ann Stores Inc. Started at the height of wartime shortages and sacrifices and following an enduring and debilitating recession, a sewing and crafts store seemed to be one of the most appropriately needed types of retailers. With money and goods in short supply and families torn apart by a demanding military effort, what better resource than providing for creating and mending clothing and other fabrics at home?

Shortly after the war, in 1946, The Navy Exchange Service Command (NEXCOM) was created. Even as the military focused on peacetime activities, it remained greatly expanded as now an emerging world leader. Serving the growing domestic needs of servicemen and their families was seen as a vitally emerging role of the military.

General merchandising purveyors remained popular for a postwar population whose longtime suppressed thirst for essentials was finally about to be satiated. 1947 saw the birth of Spencer Gifts as a mail-order catalog retailer. This at a time when the country was about to experience a new found mobility and found comfort in the convenience of mail order as seen in the commanding popularity of the catalogs issued by Sears, Roebuck and Co., among others. Spencer’s first retail store wasn’t opened until 1963 during the growing popularity of malls to which the retailer became a fixture.

Regional discount variety chain Fred’s Inc. was also founded in 1947, as a single unit operator in Mississippi. In 1953 the company moved its headquarters to Memphis and grew easily until the advent of even larger footprints with names like Walmart, Kmart and Target came on the scene during the following decade.

Interestingly the late 40’s witnessed the birth of two future toy giants. Mattel Inc. was founded in 1945 and Toys “R” Us Inc. was founded just three years later. The rapidly approaching baby boom within a climate of startling prosperity and revolutionary plans for merchandising guaranteed astounding success for these toy industry pioneers.

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1950s

The fifties was a decade of considerable growth for many of the industries covered in Chain Store Guide’s databases of Discount, Dollar & Specialty Retailers. Surprisingly it wasn’t until the very end of the decade when the second of what was to be the big three national dollar chains, Family Dollar Stores Inc., emerged. While the US economy was growing into an international power and many of its citizens were finally prospering, rapidly growing young families were having to temper any prosperity they enjoyed with a sense that there were more mouths to feed and more appetites and heads to account for.

Retailers like Family Dollar saw themselves as the community saviors of young families challenged by growing family needs. This predated the nest phase of discount retailing, the big box discounter, by just three years. However as big boxes were designed to serve regional areas, especially with the growth of regional roads and the national highway system, the considerably smaller dollar stores remained community oriented, as they do to this day.

Speaking of the then newly designed national highway system, the database of Discount, Dollar & Specialty Retailers indicates considerable startup activity for automotive aftermarket retailing. This was an era which succeeded both the Great Depression, a time during which the automobile was a luxury few could afford or even afford to maintain, and World War II, when most automotive and parts manufacturers were forced to concentrate on producing a wide variety of military vehicles and products most essential for the war machine.

Thus there was an incredible pent up demand for autos as the 1950s emerged. This increase in the demand for automobiles was further fostered by a booming economy combined with the baby boom and the well planned, emerging national highway system. America’s new found international prestige brought about greatly increased demand for our automobiles and parts overseas as well.

To this end domestically, we saw the birth of key parts chains, which eventually grew to regional and even national status. The best example here is O’Reilly Automotive Inc., which was founded in 1957, quickly emerged as a regional force and became a national power decades later with the acquisition of CSK.

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Not surprisingly a number of tire retail chains emerged from this decade. Les Schwab Tire Centers, Somerset Tire Service Inc. and Big 10 Tire Stores Inc., all began during the 1950’s. In Canada tire dealers including O.K. Tire Stores Inc., Kal Tire and Fountain Tire were founded during this decade.

Also of note at this time, Interstate Battery was founded in 1952. CARQUEST was created in 1957. The need for the emergence of such companies can be seen through simple statistics reflecting the time. In 1950 American households averaged just under one car per household. By 1960 that average increased to nearly 1.3 per household. Not surprisingly, today that number measures well more than two vehicles per household.

1960s

Coming out of the remarkable financial growth generated by the post war/baby boom era of the fabulous fifties, the sixties ushered in new modes of thought reflecting unprecedented prosperity and the desire to forge new economic and political models. This astounding growth, after the many years of enduring the harsh economic scales brought on by the Great Depression and World War II, produced an aura of unprecedented international economic and military leadership. It also allowed Americans of diverse statures to ponder the future and take on innovative measures to advance it.

Thus the era of the big box commenced in 1962 as Sam Walton began his rural- based enterprise to be known as Walmart Discount City. This after years of Walton tinkering with approaches to a new aged Five and Dime.

While Walton has received the proper kudos through the years for his reinvigoration of the classical Five and Dime model, eventually to become the world’s largest corporation, he was not alone in initiating a big box, discount/ general merchandise concept at that time. 1962 was also the year Kmart and Target entered the rapidly changing retail landscape. Not to be overlooked, Shopko was also founded in 1962. Five years later Big Lots entered the scene.

General merchandise discounters weren’t the only retailers to hear the call of the new concept- big box retail model in the sixties. In 1968 Best Buy emerged from the confines of an audio specialty shop which had been founded just two years earlier. During that same year, West Marine entered the scene as a one stop shop for marine products and accessories. Earlier during this decade Crate & Barrel was founded (1962), as were Brookstone (1965), Petco (1965) and Kirkland’s (1966).

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The sixties also saw America’s ever increasing romance with automobiles fuel the birth of chains designed to offer products to keep those cars in strong working order. Uni-Select began operations in 1968, adding to the very diverse group of successful automotive aftermarket chains launched during that decade. Earlier, we saw the entry of aftermarket icons including the Discount Tire Company, General Parts Inc., and Big O Tires. As prosperity boomed so did the realization of new retail concepts which were to expand and prosper through the coming decades.

1970s

Economically, the decade of the seventies was a particularly strong extension of the sixties. Internationally, the dollar was king. Militarily, while The Soviet Union was thought to be neck and neck with the US, their respective standards of living and projections for domestic growth were almost diametrically opposed. Westerners visiting the Soviet Union often discovered long lines outside food stores and were even approached by Soviet citizens seeking charity such as an orange, soft drinks or cigarettes that may have ‘accidentally’ found their way across the border.

While the Discount/GM big box had pretty much been born in 1962 with the founding of Walmart, Kmart, Target and Shopko, the wild success and growth of these retail formats only encouraged others to try the format on for size. Thus in 1976 Costco came on board under the Price Club name, its initial location in a converted airplane hangar in San Diego.

Originally the company served only small businesses, however the company soon saw that it could reap far greater buying power by also adding select non-business members. This idea ignited the growth of the warehouse club industry. In 1983, the first Costco warehouse location was opened in Seattle. In 1993 Costco and Price Club merged under the banner PriceCostco and the rest is a very successful, innovative history.

The prosperous seventies also witnessed the birth of eventual national retail titans including large formats Bed Bath & Beyond, Michaels Stores and Hobby Lobby. The nation’s love affair with automobiles, in part as a result of a recently minted, comprehensive national highway system, was continuing to grow as witnessed by the founding of two giants of the automotive aftermarket AutoZone and Tire Kingdom.

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A relatively new concept, office services, was created in 1970 with the founding of Kinko’s. Back at the start, the services pretty much were offered in the form of a copy shop. Ultimately Kinko’s was acquired by a company which coincidentally was founded a year later in 1971, on another revolutionary concept which had been scripted in a college paper and was inaugurated as Federal Express. Of course, Kinko’s is now FedEx Office.

Another distinctive, new-fangled operation began in 1976, founded by three partners, one of whom, Steve Wozniak, actually designed and hand built the kits that were to introduce the Apple 1. Few thought the company would succeed for any length of time. It almost didn’t and several times was on the ropes financially, during the next two decades. As proof of the degree of early doubt as to the company’s eventual success, the third partner who founded Apple, sold his shares in 1977 to the two Steves, Wozniak and Jobs, for $800.

No one at the time of Apple’s inception anticipated that a literally, home-grown computer manufacturer, which had emanated from such humble beginnings, would eventually redesign personal communications. Certainly no one had an inkling this manufacturer would become one of the world’s most admired retailers and one of its most profitable companies. Several other unique retail concepts were founded in the seventies. The Container Store began as a single unit retailer with just 1,600 sq. ft. of retail selling space. 1-800 FLOWERS commenced operations during the bicentennial and was one of the first retailers to offer a 24/7 toll free number to a public which then had a revolutionary, simple, stay-at-home option to give gifts to loved ones virtually anywhere in record time, long before there was a worldwide web.

1980s

Following Costco’s enormously successful lead, Walmart opened its own membership club concept in the form of Sam’s Club, appropriately named after Walmart founder Sam Walton. One year later, in 1984, the third of the remaining national membership clubs, BJ’s Wholesale Club, was founded by then retail discount giant Zayre Corporation, in New England. Though both of these newer club concepts were to experience challenging times, Walmart’s considerable clout in the backing of Sam’s Club and dynamic executive and strategic changes for BJs, about a decade after becoming an independent, have resulted in strong retail forces.

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Specialty retailing entered a new era as national office supply chains Staples and Office Depot were both founded in 1986. Two years later OfficeMax was founded and opened its first store in Ohio. These chains grew rapidly. Of course, currently two of these market dominators, Office Depot and OfficeMax are planning a merger.

A new concept in retailing, HSN began operations in 1982 as the Home Shopping Club on a Florida cable channel. This was in the early days of cable television. The company expanded into the first national shopping network three years later, and changed its name to the Home Shopping Network. Its primary competitor QVC began operations during the following year.

The rapid growth in the demand for home computers during this decade spawned two companies which focused on this market. Gateway was founded in 1985 one year after Dell. Gateway went on to launch a chain of computer stores, long before Apple began its ground breaking retail concept. During 2004 Gateway shuttered it entire remaining 188 stores from what had seemed to be an impressive retail chain. This was three years after Apple had opened its first retail location.

1990s

Historically, retail evolutions and even morphs generally come about as a result of eventful or pressing economic conditions or technological innovations. Consumers naturally gravitate to perceived opportunities made available by changes permitted by social or technological progress.

During the decade of the Nineties, historically stunning changes in technology brought about new classes of retailers based on a brand new range of products offered and on a stunning new platform from which to sell…the Internet.

Amazon.com started up operations mid-decade as a new kind of retailer of books. Its retail platform also was a new concept- an Internet-only company. Before long, Amazon smoothly branched out to include like products such as music CDs and pre-recorded movies on video tapes and DVDs.

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While Amazon pioneered in selling music and movies online, Netflix began operations in 1997 by offering customers a new type of service, DVD movie subscriptions to be sent through the United States Postal Service. Quickly, Netflix became the fastest-growing customer of the USPS. Meanwhile, Blockbuster was slow to perceive the competitive challenge of Netflix and even slower to react. This essentially was the beginning of the proverbial end for the one-time category killer, which had dominated the video rental scene the decade before.

Overstock.com pioneered as an almost Amazon-style e-tailer, based on the platform of an odd-lot/closeout retailer. Here the company name essentially told the story. Created just a few years after Amazon, few visitors needed instructions as to how to purchase from the site.

During this decade many other companies were started based on selling purely from the new frontier called the Internet. Others offer products made available by recent technological innovations. These startups included: GameStop, MetroPCS Communications, Value Vision Media (television shopping- popularly known as ShopNBC) and Buy.com (now Rakuten.com Shopping).

2000s

As previously noted in the last historical review, the decade of the Nineties proved to be a retail game changer, introducing companies which were essentially reflections of new technologies. Most prominent of these technologies was the Internet, as corporations now employed a brand new platform from which to sell products and services. The new century has most significantly proved to be a continuation of the above.

Redbox is one of the most impressive of the new century startups, as the first nationwide chain of kiosks to offer overnight rentals of DVDs. Starting with a standard rental fee just $1.00 per day the system grew impressively. These vending machines are located at virtually all locations of ubiquitous retailers including Walmart and Walgreens.

Redbox proved to be significant in the downfall of the leading video rental chains Movie Gallery, Hollywood Video and finally Blockbuster. The new concept of Redbox kiosks made the traditional chains seem antiquated in terms of price, time needed per visit and availability of the kiosks 24/7.

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Verizon Wireless began operations in early 2000 as the result of a complex merger, essentially between Bell Atlantic and GTE Wireless. Through the decade, other wireless providers were brought into the system including Alltel. Currently Verizon wireless operates the largest mobile network in the United States.

Gamefly Inc. is often thought of as the Netflix of video gaming. As Netflix surely compromised the industry dominance formerly enjoyed by Blockbuster, Gamefly has upset the financials of brick and mortar industry leader GameStop. However, unlike Blockbuster, Gamestop has been proactive in maintaining its position in the market with creative offerings and pricing schemes, including buying and selling used games.

While tech-based retailers have been much the rage for the past twenty years, enterprising brick and mortars continue on paths of rapid growth. Five Below entered the market as a new style dollar store model with a wide variety of merchandise, all at price points of five dollars or less. The company is on pace to open 60 new locations this year after consecutive years of opening at least 40 new locations.

2010s & Beyond

After looking back on eight decades of retail history, it is a good time to take a look at the road ahead. It can easily be said that the two most dominant and influential retailers of the 21st century are Walmart and Amazon. For virtually their entire respective existences, these companies have sent shockwaves across first American and then international retailing. The markets they grew to compete in were virtually limitless.

Walmart has brought about the demise of many independent retailers as well as a number of once leading chains such as Woolworth and nearly the once powerful Kmart. Amazon has almost singlehandedly brought about the phenomenon termed ‘showrooming’, which has sent retail executives in companies such as Target and Best Buy reeling and humbled even Walmart. Two decades ago Walmart improbably entered the grocery market and quickly dominated. Now Amazon is slowly developing its own path in this arena.

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It is now clear that the efficiencies of Internet retailing have forced traditional brick and mortars to rethink their platforms, even after adapting to the lure of Internet marketing. Thus several national chains are beefing up their already considerable Internet presence, while economizing by shrinking their brick and mortar prototypes. Best Buy is a leading retailer employing these tactics. Recent very positive quarterly financials indicate they are on the right track.

Staples, long the leading brick and mortar in terms of online sales (yes, even ahead of Walmart), opened a new prototype which significantly cuts down on real estate and relies on Internet kiosks to offer a greatly expanding array of office related products, available for rapid delivery direct to the office. Prior to their merger, OfficeMax and Office Depot were opening similar new prototypes to that of Staples. The new Office Depot will continue on that path.

Retail real estate interests must brace for the onslaught of shrinking prototypes in the coming years. Walmart’s latest investor forums have focused on its preoccupation on growing smaller prototypes, namely the Walmart Neighborhood Market concept and Walmart Express, Walmart’s answer to the most enviable growth expansion of dollar stores. CityTarget is Target’s smaller prototypes which focuses efficiencies on major urban markets.

Discount, Dollar, & Specialty Retailer Sales Leads Database

Contact the Buyers & Top Executives in the industry leading discount retailers. • 5,000* Discount, Dollar, & Specialty Retailers • 19,300* Buyers and Decision Makers • 10,900* Personal Email Addresses (Plus Version) *Counts are approximate and subject to change.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Drug Store & HBC Industry The Drug Store & HBC Industry

1930s

A typical drug store in the 1930’s was quite different than it is today. For example, Schwab’s Pharmacy was a drug store located in Hollywood, California. It was a popular local hangout for movie actors and movie industry dealmakers from the 1930’s through the 1950’s. Like many drug stores in the United States throughout the mid-twentieth century, the Schwab location sold medicines, but also had a counter serving ice cream dishes, light meals, and drinks. According to the Census Bureau, there were over 58,000 drug stores in operation at the beginning of the decade. 54,500 of those were operated by one, two, and three store independent companies. Over half of the drug store locations provided soda fountains – a concept Walgreens has rehashed into some of its new locations. According to Chain Store Guide, only 36 drug chains were founded in the 1930’s that are still in existence today, including Hi-Scholl Pharmacy, King Pharmacy, and Kopp Drug.

1940s

The 1940s were an eventful decade for perennial leading drug store chain Walgreens. After Charles Walgreen Sr. died in 1939, his son Charles R. Walgreen took over the company until his retirement in the early 1950s. The years were prosperous under Walgreen Jr. although they lacked the explosive expansion seen in the early part of the century. Other highlights include the opening of a non- profit drugstore in the Pentagon, and the acquisition of its first foreign property in Mexico.

The pharmacy in the 1940s was still very much a popular destination and social gathering place. Notable chains founded during this time include Sioux Falls, SD – based Lewis Drug in 1942 and Wadsworth, OH – based Ritzman Pharmacies in 1950. Kinray Inc., a large pharmaceutical wholesaler, was also founded during the decade in 1942.

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Like other retailing, drug stores began following the needs and preferences of the American people in a post-World War II economy. Drug stores were offering a wider variety of merchandise, advertising heavily, and offering discounted prices to lure in larger numbers of customers. In addition, the popular location strategy of today’s pharmacies being on busy corner intersections with easy accessibility was beginning to take shape in the 1950’s. Perennial industry innovator Walgreens began to build self-service stores instead of clerk service stores in the Midwest, and by 1953 it was the largest self-service retailer in the country. Notable drug chains founded during the decade and still in operation today include Astrup Drug, Fruth Pharmacy, and Ritzman Pharmacies.

1960s

The 1960’s saw the founding of one of largest and most influential pharmacy retailers in United States history – CVS Caremark. Its first store – selling only health and beauty products – opened in 1963 in Lowell MA by brothers Stanley and Sidney Goldstein and partner Ralph Hoagland. By 1964, the chain had 17 locations. The CVS banner (standing for Consumer Value Stores) is developed into the company’s original logo. It wasn’t until 1967 that the company began operation of its first stores with pharmacy departments, opening locations in Rhode Island, Warwick, and Cumberland. In 1969, CVS was sold to Melville Corporation and by 1970 it operated 100 stores in New England and the Northeast.

CVS was still far behind industry leader Walgreens, which by 1960 filled its 100 millionth prescription. Walgreens was a strong innovator in the marketplace, entering the Puerto Rico market during the decade and revolutionizing child- resistant prescription containers. Ironically, another industry leader was founded during the 1960’s – Rite Aid. In 1962, the company opened its first store as Thrift D Discount Center in Scranton, PA. By 1968, it officially changed its name to Rite Aid Corporation and made its first initial public offering. Like most stores in the 60’s, the emphasis began to shift towards price and promotion, in addition to self- service offerings and departments.

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As with many retailers in the country during this time, drug stores were trying to adapt to the rapidly changing needs of the customer. CVS began differentiating itself from its competition by opening small health and beauty aids stores in enclosed shopping malls. By 1974, the company achieved $100 million in annual sales, with the help of two multi unity store acquisitions – the larger being its 1972 acquisition of 84 Clinton Drug and Discount Stores. However, CVS still lagged behind industry leader Walgreens, which reached $1 billion in sales by 1975. During this time, Rite Aid’s 267 stores had spread across 10 states, and the company was listed on the New York Stock Exchange. Also during this time, a significant technological advancement in pharmacy retailing emerged – the electronic portable digital counting device for prescription medicine. The technology was invented in Manchester, England by brothers John and Frank Kirby and patented in 1970. By 1975, it was exported to American and greatly helped to automate and increase efficiencies.

1980s

At the time, Walgreens was still the retail pharmacy leader. However, the gap began to close and the ‘big three’ drugstore chains were growing rapidly. By 1981, Rite Aid had cemented itself as the third-largest retail drugstore chain in the country, and in 1983 it surpassed $1 billion in sales for the first time. Walgreens achieved this feat in 1975, and by 1984 it opened its 1,000th store in Dearborn, Chicago. CVS reached the $1 billion sales mark in 1985, and at its 25th anniversary in 1988, it finished the year with nearly 750 stores and $1.6 billion in sales. In the industry, the electronic portable digital counting device that was brought over to America in the previous decade was making traction throughout pharmacies. An increase in the demand for personal home computers as well as computer use in the business world also helped to increase efficiencies.

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This decade was about rapid expansion and major acquisitions in the retail drug industry. Highlighted by CVS and Rite Aid, several major acquisitions propelled the Big-Three to having over 10,000 pharmacies operated combined. In 1990, CVS acquired 500 stores from People’s Drug, which helped to establish new mid-Atlantic markets for the company. Then in 1997, CVS completed the largest acquisition in the history of the U.S. retail pharmacy industry – 2,500 stores from Revco primarily in the Midwest and Southeast. After a 1998 purchase of 200 Arbor Drugs of Michigan locations, CVS was up to 4,100 stores in 24 states.

In 1995 Rite Aid made the largest acquisition in its history with the purchase of Perry Drug Stores – the largest drugstore chain in Michigan. The deal propelled Rite Aid to nearly 3,000 stores in operation. Then in 1996, Rite Aid added an additional 1,000 stores with the acquisitions of Thrifty PayLess Holdings, Inc., Harco, Inc., and K & B Incorporated. Rite Aid and General Nutrition Companies (GNC) began its ‘store-within a store’ concept in 1999. Not to be outdone was Walgreens, which grew mostly organically and opened its 2,000th store in Cleveland OH in 1994. Walgreens also launched new offerings with its online pharmacy services and in 1997 it rolled out a new prescription-filling computer system to all of its stores. By year 2000 the company reached the 3,000 store mark.

2000s

Throughout the decade and up to present day, the retail drug industry has been dominated by the three big players – Walgreens, CVS Caremark, and Rite Aid. All have made significant changes and improvements to their respective businesses over the past 10+ years. In 2000, Walgreens was up to 3,000 retail pharmacy locations. By fall 2007, it had doubled its retail network to 6,000, highlighting the explosive growth it experienced during the decade. Also in 2007, CVS Corporation and Caremark RX Inc. completed their transformative merger, creating CVS Caremark, the nation’s premier integrated pharmacy services provider. In 2009, CVS operated over 7,000 pharmacy locations, and in 201 the company exceeded $100 billion in total revenue.

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For Rite Aid, the decade was a mixed bag. In 2007, it completed its purchase of the Brooks and Eckerd drugstore chains, cementing the company as the largest drugstore chain on the east Coast and the third-largest nationally. However declining profits, problems with the integration process, and store closures led to a 75% drop in stock price before closing at an all-time low in 2009. Today, the much leaner company is still the third largest drugstore chain in the country, while recently in 2013 reporting three straight sets of positive earnings per share.

2010s & Beyond

Consolidation has been the one constant theme in the retail drug industry. The ‘Big Three’ chains dominate prescription market share and pharmacy locations and will continue to do so in the future. Rite Aid has made a strong comeback and has solidified itself as the number three pharmacy operator in the country. However, discounter Walmart and grocer Kroger are not far behind and will likely look to the pharmacy department as growth areas in their respective businesses. Other trends that will shape the face of the industry will center on the Affordable Care Act and how it affects individuals’ payments for prescription medicines. While it is possible the number of total consumers with health care coverage will increase, the bottom line cost to their wallets for pharmaceuticals remains to be seen. In addition, individuals have been slow to sign up for the coverage, and the government website supporting the Affordable Care Act has been plagued with technical issues. The controversial law is opposed by many, and the first quarter of this year will be critical for the Obama administration’s credibility on the health care front.

Drug Store & HBC Chain Sales Leads Database Contact the Buyers & Top Executives in the top drug stores & HBC chains. • 6,100* Drug Stores & HBC Chains • 13,800* Buyers and Decision Makers • 3,700* Personal Email Addresses (Plus Version) *Counts are approximate and subject to change.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Home & Hardware Industry The Home & Hardware Industry

1930s

After publishing the first Chain Store Guide in 1933, entitled The List of Restaurant Chains, Chain Store Guide founder Irving Slobod embarked on his next two projects. This resulted in guides for Auto Accessories Chains and Hardware Chains, which were published in 1934.

Mr. Slobod felt that while the economic devastation brought on by the Great Depression had all but killed consumer abilities to afford, much less seek new homes and/or cars, repairs were more necessary than ever. Mr. Slobod saw these two industries as aligned and recession proof. Ultimately they were published as one volume under several iterations of the title of Directory of Hardware and Auto Supply Chains through 1979.

During the 1930’s, home centers, which preceded bigger box, home center warehouses were decades from entering the scene. Local hardware stores and paint dealers were in demand as consumers tried to maintain their homes as best as they could afford.

Entering the decade there were more than 25,000 hardware stores scattered across the country. To help manage their many challenges for survival in a harsh economy, Ace Hardware had been founded in 1924 and was incorporated in 1928 just before the Great Depression hit. To many independent hardware retailers at the time the concept of a co-op was a godsend, as it offered a haven of economically priced products with the beginnings of instruction on modern day merchandising.

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The early part of this decade was dominated by the actions of war. The consolidated national effort behind World War II produced a sense of unity which was the result of a virtually unanimous determination to see the war through to a successful conclusion no matter what the personal cost. This produced a sense of sacrifice which included virtually anything necessary to promote a successful war effort. Thus many materials which would have been deemed essential to home building or repair were in very short supply as were many of the skilled people who were using their abilities in the war effort.

As the nation began to shift from a mode of war to one of peace, we began to see the founding of a number of dealers and distributors which reflected both the nation’s new focus as well as the dawn of a sense of national prosperity. Current regional retail stalwarts including ACO Inc., The Andersons and The A.G. Mauro Co. were founded in 1946, 1947 and 1949 respectively. Buying cooperatives Do It Best and True Value Company were founded in 1945 and 1946 respectively.

Long time national power Lowe’s was founded in 1946, based on a single family owned location which had been run by the women of the family as the men fought in the war. A second location was acquired in 1949. The first Lowe’s store focused on selling hardware and building materials but also offered dry goods, produce, groceries and supplies for horses.

Chain Store Guide’s current database includes 564 companies which were founded during the Fighting Forties. Of these, 125 companies were founded prior to 1945, 77 more were founded during 1945 and 362 were founded after 1945. The trend here is clear, as we emerged from the war effort and began to put the sacrifices behind us in a climate of oncoming prosperity, there was a clear need to finally repair and restore our homes. As the baby boom emerged, new home building became paramount. The aforementioned are all companies which have survived the tests of time for over six decades, including the ravages of the recent subprime crisis and the debilitating recession.

1950s

By the turn of the decade it was clear that the US had entered a new, post-war era. The American economy clearly had left behind its need for harsh sacrifices with the ravages of the economies of the Great Recession and World War II.

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As families grew in size and in wealth, the great need for building and remodeling became apparent. Chain Store Guide’s databases of Home Center Operators & Hardware Chains and Building Products Distributors indicate that during the decade of the 1950’s, 559 companies were founded that still exist today. Of course the late 1940’s contributed additional dealers who were preparing for a hopeful post-war expansion. Lowe’s founded in 1946 opened its second location, a hardware store in 1949.

Longtime industry-leading pro dealer 84 Lumber opened its first unit in 1956 and quickly saw the need for its services go way beyond the geography of its initial locations. Ultimately, the chain took on a national flavor while carefully building its brand with close ties to respective community needs.

It was in 1955, at the half point of the decade, that Chain Store Guide founder Irving Slobod met with colleagues at sister company Lebhar-Friedman, to discuss the future of the industry. During the meeting it became apparent that industry retailers would be growing their prototypes to meet the needs of the emerging population for the building boom.

Mr. Slobod thought out loud as he sought to define and describe the new retail archetype. He thought these dealers needed to prepare not only for building, but for remodeling and repair, as well as helping consumers with products designed to make residences more livable. Thus he came up with a term designed to promote retail establishments offering a full range of products and services for this new age. He coined these Home Improvement Stores. This he then enhanced this with the term Home Improvement Centers, which is still widely used today.

1960s

The incredible growth of the economy during the fabulous fifties and the effects of the baby boom resulted in a stunning demand for home building, both new and as add-ons during the sixties. It was in this atmosphere that John Menard began his small firm, engaged in new home building. As his and his competitor’s demands for building materials grew, Menard set up his first location, designed to offer lumber and the many other products needed to fuel the building drive. Ultimately Menards became a unique big box icon, years before Home Depot set its mold. To this day Menard continues to grow its prototypes as many big box mainstays across the entire retail spectrum seek to shrink theirs.

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Fastenal Company was created in 1967 to meet the rapidly increasing needs of supplies for builders. To this day the company continues to innovate efficient distribution standards to meet the needs of its builder customers. Currently, in addition to aggressively approaching the opening of its 2,700th location, the company has embarked on a program which has strategically placed nearly 30,000 FAST Solutions industrial vending machines, to make its most essential building products ever more accessible to its busy customers.

The Farm & Home segment of our industry also felt the demands of a strongly growing market during the sixties. Thus as early as in 1960 we witnessed the introduction of what were to become two cornerstones of this market, Orscheln Farm & Home and Rural King Supply. Though essentially regional in scope, these powerhouses have grown to offer over 200 locations between the two companies.

1970s

In the mid 1950’s, Chain Store Guide founder Irving Slobod coined the term Home Improvement Center, as colleagues sought to define the coming larger prototypes which would supplement the increasing demands on traditional hardware stores by a growing and ever more affluent population. Thus for the next two decades home centers continued to expand the dimensions of the industry, as a strong economy induced growth in building as well as remodeling.

Home Centers flourished despite a well-earned reputation for often operating as part on an old boy’s network. Expanded buying power and a large box offering a fairly total package to customers was so compelling that maximum efficiencies were not seen as paramount to the ability to rake in considerable profits.

With this in mind, The Home Depot was founded. Its four founders envisioned the efficiencies, especially in terms of buying power, which would gain major accommodations directly from manufacturers based on customer demands which could be best satisfied by a warehouse sized format.

They also carefully planned this grand, new organization to make sure that as it saved customers dollars, those savings were a direct reflection of a carefully, tightly run organization. These factors plus the ability to more thoroughly compete with pro dealers for the builder’s market, pretty much doomed many of the existing home center operators who clung to their old boy’s ways.

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Also of note during the seventies was the founding of Harbor Freight Tools which created an almost big box concept to offer the full gamut of tools and devices that could satisfy the desires of any builder or do it yourselfer. Also prominent regional powers Ridout Lumber and RP Lumber were established during this decade.

1980s

The 1980’s was essentially a decade which confirmed the genius behind the platform which had been launched to create the Home Depot. The Home Depot was founded in 1978 and quickly rose to a position of industry dominance. The influence generated by its big box/home center warehouse platform and its resulting ability to dictate supply chain terms directly to manufacturers, quickly began to undermine previously dominant home center chains, with their smaller prototype and lack of focus on modern supply chain efficiencies.

Traditional industry number two, Lowe’s, quickly fell behind the new leader but has since long maintained its annual number two spot. In order to keep its status quo, Lowe’s essentially copied the Home Depot platform by rapidly growing its prototype, while maintaining an aggressive expansion pace. In fact Lowe’s was fine with the notion of opening some of its warehouse locations near to existing Home Depots; some even competed from across the street.

While these were the only two nationally based home center warehouse chains, longtime industry number three, regional power Menard also ran from a platform which stressed the acquisition of goods direct from manufacturers based on supply chain efficiencies and an incredible ability to have its stringent demands acceded to by manufacturers. All this while continually increasing the square footage of its prototypes.

During this decade, Sears inaugurated its unique chain of hardware stores, based in part on its enviable reputation of offering quality products and tools for the do it yourselfer, at reasonable prices. Its full line of tools under its Craftsman brand were the envy of manufacturer competitors as well as many retail chains which were denied access to the brand due to the exclusive nature of the private label with Sear’s stores.

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A decade later Sears purchased Orchard Supply Hardware, the large format, California-based hardware chain. It was later announced that Sears Hardware Stores would be converted to the Orchard format and brand. The company then expected to begin an aggressive expansion of the entity. After several years of anticipating this changeover, it became apparent that this was not meant to be. By this time, the retail icon which Sears had long represented was itself vulnerable and it became clear that the company was in no condition to launch a new ancillary concept.

1990s

The nineties proved to be a natural extension of the decades of the seventies and the eighties for the home center/hardware market. Home Depot’s imposing and ultra-efficient platform proved to be successful beyond all dreams and the company’s growth came at the expense of a lot of smaller home centers and hardware stores, which struggled and at times failed to survive.

In fact during the decade of the nineties, several warehouse style home center chains eventually succumbed to the financial stresses of operating giant home center warehouses at less than optimum efficiencies. Simply, they abandoned operations despite having the Home Depot model to look up to. On the other hand, Lowe’s was successful in its morphing to the warehouse model from its much smaller prototypical roots. These failed chains included Builders Square, Home Quarters Warehouse and Handy Andy Home Improvement Centers.

Overall, the decade was one of steady financial growth for most retailers in this market. Annual increases in total sales were often attributed to rising prices for building materials. However, based on the laws of supply and demand, these pricing trends general reflected the growth of housing starts and renovations during an exceedingly prosperous economy which included years of national surplus.

During this decade Builders FirstSource was founded. The Texas based pro dealer started out strong, grew slowly as the economy called for, and later struggled during the recession as did virtually all pro dealers.

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Lumber Liquidators was founded in 1993 by a building contractor who began purchasing excess wood from other companies. He then resold his wares from the back of a trucking yard. In 1996, he opened his first store and opened a second eight months later. Today, after years of steady growth, even through the years of the recession, the company operates well over 300 stores and expects to open 10- 12 by the end of the next quarter.

2000s

The decade of the nineties exited on a strong financial note for the home center/ hardware industry. Continuing on a slew of strong growth years into the new millennium, many companies in this industry maintained rates of unprecedented annual financial growth. In the early part of the new century, the housing boom grew as almost never before. This was in large part a reflection of the overall strength of a national economy riding the crest of a budget surplus.

Unfortunately, just past the middle of the decade, other factors behind the housing boom began to emerge. The term ‘subprime’ came out of obscurity and quickly became a fixture in news reports.

It turned out that speculation in housing had run amok. Loans were not just being granted based on traditional consumer merits. Loans were being given away with little in the way of true collateral. The term ‘flipping houses’ emerged and eventually was so commonly mentioned that it became the fare of a television show. The subprime crisis went from obscurity to a much mocked practice, as it was discovered that poorly backed mortgage loans were being bundled and sold internationally as financial securities, as if they were secured notes or bonds.

Suddenly, most companies in this market saw once rapidly rising annual financials quickly sink. The subprime crisis brought recession-like results to this market well before the recession crippled the rest of the country.

Though the past few years have been rough on this industry, especially pro dealers who so rely on builders with new housing starts, a couple of major startups emerged out of mergers and acquisitions of prominent distributors. BlueLinx Holdings began operations in 2004 when the company was essentially created to acquire the distribution division of Georgia-Pacific Corporation.

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ProBuild Holdings began operations as a result of what was basically the merger of two powerful building products distributors. The Strober Organization was an established, growing power, representing the Eastern United States. The Lanoga Corporation was a similar power focused on the Western US, with strong holdings deep into Alaska.

Both of these new companies seemed destined for growth and greatness until the subprime crisis hit, followed by the recession. Like most companies in our industry, financials became challenging and location closures, at times a must.

2010s & Beyond

After the economically staggering industry conditions brought on by the subprime crisis followed by the recession, the industry has recently enjoyed modest prosperity and even growth. Recent Home Depot financial reports have been most encouraging and required focus on the company’s successful initiatives after returning to its roots, focusing on strong customer service to the do it yourselfer. Even Lowe’s seems to have recovered from a period of merchandising guffaws and public relations flops, including poorly executed store closings and exits from previously esteemed markets. Menards continues on its unique path, being one of the few major retail chains to actually grow its store footprint in the industry.

Throughout the industry’s economic sufferings in recent years, the Farm & Home segment has more than held its own. In many instances resident companies have actually grown considerably. This has been achieved through retailers knowing their customers actual needs and wants and adapting product mixes, even radically, to meet them.

The best example of growth here, and perhaps throughout our industry, is that of Tractor Supply. Since 2004, the company’s weakest year for growth saw an increase of 75 locations. Twice in that time the company added a high of 91 stores for those respective years.

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As economic signs continue to offer hope, despite occasional mixed indicators, Farm & Home retailers should continue to prosper, especially Tractor Supply. As to the rest of the industry, though many recent economic building indicators have been fairly positive we still are hit by negatives as well. While regional Menards seems to consistently experiment and expand annually, national powers The Home Depot and Lowe’s have been limiting openings in recent years to the single digits or barely above. Until building growth is strong and consistent for some time, these stalwarts are not likely to significantly increase expansion plans.As the industry leaders go, most of the industry follows.

Home Center & Hardware Store Sales Leads Database

Contact the Buyers & Top Executives in the top home center & hardware stores. • 4,400* Home Center & Hardware Companies • 16,000* Buyers and Decision Makers • 6,400* Personal Email Addresses (Plus Version) *Counts are approximate and subject to change.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Restaurant Industry The Restaurant Industry

1930s

In the 1930s, choices for dining out were pretty limited: automats, cafeterias, coffee shops, and full-service fine dining restaurants. With high unemployment and low wages, eating out wasn’t an option that many folks exercised. For those who did venture out, they might have found (depending on where they lived) an A&W Restaurant, Big Boy, Bridgeman’s, K&W Cafeteria, Krystal, Pat O’Brien’s, Peter Luger, S & S Cafeteria, Trader Vic’s, or White Castle. However, despite the ongoing recession, government figures show that the number of restaurants rose more than 25% during the decade, likely encouraged by the repeal of Prohibition in 1933.

1940s

The war years of the 1940s posed a dichotomy for restaurant operators. The demand for food outside the home increased as more women joined the work force as the men were deployed, but labor shortages and rationing of both food and gasoline created difficult business conditions. The Chain Store Guide database includes only 33 new businesses founded between 1940 and 1945. Among those were Dairy Queen and Carl’s Jr., both opened prior to America’s entry into the war in late 1941. Even after the war, supplies remained tight for a time, while women returned to their own kitchens. However, by the end of the decade the economy was starting its post-war boom, and businesses of all sorts began to flourish.The CSG database shows that more than 60 restaurant companies came on the scene during the last four years of the 1940s, including such iconic brands as Baskin- Robbins, In-N-Out Burgers, and Long John Silver’s.

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When World War II ended, men returned to their ‘real’ jobs and many women left their war-time positions and returned to their homes full-time. Despite the post- war boom, the foodservice industry wasn’t thriving. Perhaps not so coincidentally, the TV dinner made its debut in 1953. In an effort to boost business, the National Restaurant Association adopted the slogan, “It’s fun to eat out.” Among the family-friendly chains that opened their doors for the first time during the decade are Bob Evans, Denny’s, and IHOP.

A booming Detroit also served as a catalyst to a major change in foodservice. Prior to the onset of WWII, the Depression had taken its toll on new car purchases. During the war, many of the automobile plants were retooled to support the Allied Powers efforts, significantly reducing the production of civilian vehicles. These two factors combined to develop a high level of demand for new cars once the conflict was settled. Automobile ownership in the U.S. jumped from 222 cars per 1,000 people in 1945 to 324 in 1950 and 410 by 1960. By 1955, there were more cars than households in the U.S. Along with the more mobile population arose many of today’s most iconic drive-through brands: McDonald’s, Burger King, KFC, Pizza Hut, Taco Bell, Whataburger, and Jack in the Box.

The Chain Store Guide Database of Chain Restaurant Operators currently has more than 200 restaurant-operating companies that were founded between 1950 and 1959.

1960s

The ten years following the peaceful and prosperous 1950s was highlighted by massive social upheaval. The civil rights movement reached its peak, the Vietnam War was heating up and becoming increasingly unpopular, especially among young people, and the assassinations of Marin Luther King and two of the Kennedy brothers were sober reminders that the world was changing. Many of the so-called baby boomers were in college and no longer content with the status quo, not at all hesitant to protest and express their dissatisfaction.

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Amid the turbulence, Pete’s Super Submarines was opened by a teen-ager named Fred DeLuca in 1965 as an effort to earn enough money for college. That little sandwich shop is now the Subway system, operating nearly 40,000 stores in 100 countries around the world. Arby’s, Blimpie, Captain D’s, and Hardee’s also began selling their sandwiches in that decade. Huddle House, the restaurant that famously never closes, opened its first door in 1964 and was marketed as a place for customers to “huddle” after the big Friday night football games. Red Lobster and Ruth’s Chris Steak House started operating to serve the needs of a more adult diner.

1970s

By the 1970s, the world was a little more settled. The Vietnam war came to an unsatisfactory conclusion with the fall of Saigon. The hippies had gone home, and disco dominated the music and fashion scene. Women took to the streets and the halls of Congress demanding equal rights, and Richard Nixon was forced to resign in the wake of the Watergate scandal.

The 1970s were boom years for restaurant growth, with nearly 800 companies in the CSG Database debuting between 1970 and 1979. Women were an increasingly large part of the workforce during this time: According to U.S. government numbers, the participation rate of married women jumped from 27.6% in 1960 to 39.7% in 1970 up to 54.1% by 1980. Married women often have families so this movement of women into the workplace began to signal the increasing importance of quality time with their loved ones. Casual-dining chains such as Bennigan’s, Cheddar’s, Cheesecake Factory, Houlihan’s, Ruby Tuesday, and Tony Roma’s all premiered during that decade, offering consumers a relaxed, friendly atmosphere where they could congregate with family and friends over adult beverages and eat mostly American food that they didn’t have to cook themselves or clean up after.

Perhaps because of the burgeoning Subway chain, the era also saw the proliferation of sandwich chains, including Au Bon Pain, Jason’s Deli, Cousins Subs, Mr. Submarine, Port of Subs, and Potbelly Sandwich Works. There was also an increasing emphasis on ethnic food, especially from south of the border. Taco Cabana, Taco Mayo, and Taco Maker joined the growing Taco Bell chain in bringing Mexican food to the masses. Baja Cantina, Chili’s, El Toro, Hacienda Mexican Restaurants, King Taco, Mighty Taco, and others were part of the movement. Starbucks served its first cup of coffee in 1971, launching the gourmet coffee trend that continues up to today.

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In 1987, Ronald Reagan challenged the Soviet Union’s leader Mikhail Gorbachev to “tear down this [Berlin] wall.” By the end of the decade Germany was reunified, and the Soviet Union was unraveling. The computer age was well and truly underway with the introduction of personal computers into offices and homes.

On the foodservice front, the 80s were the decade of the chicken wing. The most commonly accepted version of the origin of the Buffalo wing phenomenon is that they were first served at the Anchor Bar in Buffalo, NY, in the mid-60s, and were created by the bar’s owner to 1) serve unexpected company, 2) prevent them from going to waste or 3) provide a treat on late Friday night to serve their Catholic customers who hadn’t eaten meat all day. Wings were typically discarded by restaurants at the time, so finding a profitable use for them was like found money. In 1982, Buffalo Wild Wings opened its first restaurant, followed the next year by Beef ‘O’ Brady’s then Hooters in the mid-decade. We also saw the start of The Wing Machine, Wings N Ribs, and Wings to Go.

Another trend noted at the time was a growing desire for gourmet ice cream and treats. Feeding this appetite were Bruster’s, Cinnabon, Cold Stone Creamery, Culver’s, Dippin’ Dots, and Marble Slab Creamery. Sandwich chains continued to proliferate with the openings of Jersey Mike’s, Penn Station, Philly Franchising.

Five Guys Burgers & Fries and Panera Bread ushered in the era of what we now call fast-casual foodservice, with food prepared to order but a lower price point than a traditional casual-dining location. More coffee houses opened under the Barnie’s and Joffrey’s name. Many of the other restaurant operators that began in that decade were franchisees of varied concepts as the idea of the franchise business model caught on. Among the more than 1,200 restaurant companies founded in those ten years was a proliferation of many different types of ethnic chains, ranging from Mexican to pizza to Chinese to Italian to Vietnamese and beyond.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Restaurant Industry 1990s

The 1990s began with the invasion of Kuwait by the troops of Iraq’s president Saddam Hussein. Although the invaders were quickly turned back by a coalition force from 34 nations, it foreshadowed the violence that was to come. The World Wide Web became available to the public, and computers continued to revolutionize how business was done, particularly as Microsoft technology grew in popularity and dominance.

There were two major foodservice trends in the 1990s: the growing popularity of the fast-casual service model and the desire for more and better gourmet coffee.

Building on the popularity of the new fast-casual chains Panera and Five Guys, restaurateurs such as Steve Ells, Steven Kolow, and Aaron Kennedy developed the Chipotle, Boston Market, and Noodles & Co. brands. Other well-known fast- casual chains that were started during those ten years are Atlanta Bread, Camille’s, Cosi, Firehouse Subs, Pei Wei, and Qdoba. The service model lends itself well to items such as sandwiches, salads, and some ethnic foods, including Mexican and Chinese. The basic characteristics for most of these chains are the lack of freezers and deep-fryers and the availability of customized, made-to-order food. For time- starved consumers, the allure of fresher and healthier food has proved undeniable.

Two decades after Starbucks debuted in Seattle in 1971, the company was up to 125 locations. By 1992, there were more than 250 Starbucks coffee houses, and by the end of the decade, there were more than 2,000. The job title of Barista entered the American vocabulary. Among the companies that took note and began their own caffeine-fueled operations during those years are such well-known brands as Caribou Coffee and Tully’s, along with regional brands such as Bad Ass Coffee of Hawaii, Blenz, Jittery Joe’s, and Port City Java.

Buffalo wings also continued to be a money-maker for companies, and the decade saw the entry of Wingstop, Wild Wing, and Wing Zone into the market.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Restaurant Industry 2000s

In the restaurant industry, the 21st century has seen the explosion of the fast- casual gourmet hamburger. At the start of the decade, the most well-known of the “better burger” chains, Five Guys Burgers & Fries, had a grand total of five locations. At the end of 2012, that number had swollen to more than 1,100. Trying to cash in on this movement have been a number of burgermeisters, including BGR The Burger Joint, Cheeseburger Bobby’s, The Counter Burger, Smashburger, and Square One. Established restaurant-operating companies jumped into the competition with Front Burner Brands (The Melting Pot) opening Burger 21 locations, Bold Foods (headed by celebrity chef Bobby Flay) debuting Bobby’s Burger Palace, and Red Robin Gourmet Burgers Inc. introducing its Burger Works concept, a stripped-down version of its casual dining model. Coffee and Buffalo wing restaurants have continued to be popular, as are ethnic and other fast-casual concepts.

Entering the fast-casual fray in a big way is pizza. Long considered impractical for cooking in a quick-service environment, new technology and methods are putting the lie to that thought. The past few years have seen the rise of Blaze Pizza, M.O.D. (Made On Demand) Pizza, Pie Five (a new concept from Pizza Inn), Pizza Fusion, and Your Pie among others.

Greek and Mediterranean foods also lend themselves to the fast-casual business model, as exemplified by chains such as Garbanzos Mediterranean Grill, Roti Mediterranean Grill, and Little Greek. Fast-casual sandwich makers continue to enter the marketplace, with names like Smiling Moose Deli, Which Wich, and Earl of Sandwich.

Apparently the sky’s the limit for new concepts and new variations on old classics when creative chefs and restaurateurs put their thinking toques on. We can only hope the next eight decades will be as exciting in food service as the past eight decades have been.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Restaurant Industry 2010s & Beyond

The past 80 years have brought a paradigm shift in the way the foodservice world operates, moving from single-unit mom-and-pop diners and coffee shops serving American food to the current climate of chains comprising thousands of locations worldwide serving food from around the world. Prohibition was just ending in the U.S. when Chain Store Guide began in 1933, and today’s restaurants and bars are stocked with hundreds, if not thousands, of varieties of beer, wine, and spirits. The pencil, pad, and cash register have been replaced by POS systems, kiosks, and tabletop devices.

What changes are on tap for this volatile market? At a national level, immigration reform and minimum-wage issues will continue to dominate the conversation, along with ongoing concerns about the Affordable Care Act. Nation’s Restaurant News recently conducted an online survey of operators and reported that sluggish consumer spending, higher commodity costs, and increased government regulation are the industry’s biggest challenges while health-care reform and minimum-wage increases were the issues most likely to affect those who responded.

Technology will continue to evolve, allowing managers to focus on customer interactions instead of the time-consuming bookkeeping and clerical functions endemic to running a business. Mergers and acquisitions are likely to continue at all levels – in just the past month, Roark Capital acquired CKE Restaurants (dba Carl’s Jr. and Hardee’s) and Centre Partners acquired Captain D’s. The nation’s preeminent foodservice distributor, Sysco Corporation, has announced plans to acquire its largest competitor, US Foods, and The Chefs’ Warehouse acquired two smaller distributors this past year. As consumer confidence continues to build, venture capitalists, private-equity funds, and savvy entrepreneurs will identify and seek to acquire other successful or promising businesses.

This is also the time of year when chefs are asked to predict what food trends they see developing, and the recently released National Restaurant Association’s 2014 Culinary Forecast identifies the following top five trends: 1) Locally sourced meats and seafood, 2) Locally grown produce, 3) Environmental sustainability, 4) Healthful kids’ meals, 5) Gluten-free cuisine. Ancient grains, new cuts of meat, ethnic-inspired breakfast foods, and nose-to-tail/root-to-stalk cooking also made the top 20 list.

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Despite all the changes in the ‘how’ and ‘where’ of the restaurant business, at its core the foodservice industry has changed little – it’s still about people who want to serve their customers good food, regardless of its origins or how it’s prepared. This is one paradigm that will not change.

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NewsRoom.ChainStoreGuide.com 1-800-927-9292 Supermarket, Grocery, & Convenience Store Industry The Grocery Industry

1930s

The supermarket industry was much different in the 1930’s than today; small independent meat markets and grocery stores were abundant. According to the Department of Commerce Census Bureau, there were over 190,000 grocery store locations without meats at the beginning of the decade, many of which were independently owned. 91,000 locations were in operation that sold meat products, while there were over 23,000 meat markets that sold groceries. The list of supermarket chains that were founded in the 1930’s is impressive, and many are still in operation today as strong regional players. The list includes Publix Super Markets, Giant Eagle, Hy-Vee, Stater Bros., Raley’s, Schnucks, King Kullen, Fareway Stores, and Marsh Supermarkets. By the end of the decade, chain store companies began refining the supermarket concept originally dominated by independents and small regional chains. Supermarket pioneer The Great Atlantic and Pacific Tea Company began consolidating its thousands of small service stores into larger supermarkets, often replacing as many as five or six stores with one new, larger one.

1940s

By the 1940s, the supermarket format as we have come to know it today was rounding into shape. Initially operated by many independents and small regional chains, the larger national operators began adding more stores. Their supermarket concept was a more refined one, adding a level of sophistication, class, and square footage missing from earlier predecessors. In the late 1930s, the Great Atlantic & Pacific Tea Company began consolidating its thousands of smaller stores into these larger supermarkets, and by 1940 its store count was reduced by half but its sales were up. Similar scenarios occurred across the larger chains, with store counts peaking in the late 1930s and consolidation in full effect into the 1940s. Throughout the decade, most national chains including Safeway and Kroger operated both modern concepts and ‘old-style’ stores leading to gradual consolidation. Ironically, both of Hawaii’s largest independent chains – Foodland and Times Supermarkets – were founded in the 1940s.

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Food rationing was commonplace in the early 1940s because of the Second World War; by 1943 many common items with ration coupons included dried fruits, cheese, meat, butter and processed foods. According to some historians, many retailers welcomed rationing because they were already experiencing shortages of items due to rumors and panics.

1950s

The 1950’s were considered by many as the ‘golden age’ of supermarket retailing. The transition to larger, full-service stores was mostly complete. Locations spread out like much of the population did at the time – into the suburbs. In a post-World War II economy, the American people aspired to live bigger and better: more spacious housing, state of the art refrigerators and freezers, and other modern luxuries. These new ideas fit perfectly with the new supermarket format.

The decade produced some iconic supermarket buildings including A&P’s colonial-themed stores and Safeway’s glass arch shaped design. The opening of a new supermarket was a big event in many towns with bright, big new stores, ribbon cuttings, and newspaper announcements. Notable supermarket chains founded during the decade and still in operation today include Food Lion, Trader Joe’s, and Roundy’s.

1960s

At the back end of the ‘Golden Age’ of supermarket retailing, the 1960’s began to focus more on the inside of the store. In the later part of the decade, zoning regulations and a changing taste of consumers led to a more restrained architectural design, while interior designs began to compensate. Vivid and colorful interior concepts began replacing the bland styles of previous stores. The term ‘specialty department’ emerged as a way to describe the features inside stores, while floors were sometimes outfitted with carpet. The 1960’s, however, were also a time when the ‘discounting’ trend began to emerge. Many stores around the country initiated discounting programs which centered on cost-cutting, reductions in operating hours, and eliminating trading stamps. The discounting trend continued into the 1970’s and of course is still very prevalent today.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Supermarket, Grocery, & Convenience Store Industry 1970s

The tastes of the food consumer were changing, but not towards flavors. Shoppers began to be put off by the flashy, colorful trends of the 1960’s while wondering what the costs of these amenities might be. The backlash began with ‘discounting’ in the late 1960’s, and continued into the 70’s. Kroger introduced a new ‘superstore’ prototype in 1972 during the peak of this trend. However, a bigger shakeup was on the horizon in the world of supermarket retailing. The low-price focus and discounting trend were leading to new store formats, with warehouse concepts and outlet centers gaining steam. Perennial supermarket leader A & P was late to arrive to the discounting theme, and struggled to find its way during this time.

1980s

After so much focus was placed on the discounting trends and low-price focus in the 1970s, the supermarket industry began to create more variety in its store offerings. Mainline companies began experimenting with upscale formats as well as store-within-a-store concepts. Current trend-setting supermarket chains Whole Foods Market and The Fresh Market were founded during this decade. In addition, several ethnic chains founded in the 80s that are continuing to operate very successfully today include Hispanic-oriented Northgate Gonzalez Market and Vallarta Supermarkets. Asian food-themed stores Tawa Supermarkets, which operates the 99 Ranch Market stores and H Mart were also established in the U.S. during the 1980s. However, one discount concept started this decade evolved into arguably the most influential and ground-breaking food retailing format ever: Walmart’s Supercenter format. The first opened in 1988 in Washington, MO. Now, many Walmart stores have converted to the format which has propelled the company to the number one grocery retailer in the country for most of the past two decades. Warehouse concepts Sam’s Club (owned by Walmart) and BJ’s Wholesale Club were also founded in the 80s.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Supermarket, Grocery, & Convenience Store Industry 1990s

The decade began with supermarket titans Kroger, Safeway, The Great Atlantic & Pacific Tea Company, and Albertsons competing heavily for food dollars. The re-emergence of superstores, featuring general merchandise and groceries under one roof, made retailers pick which side of the coin they were going to compete on. Some companies like Harris Teeter in North Carolina abandoned discounting altogether. Walmart was becoming a major grocery competitor with its supercenter concept and was shooting up the yearly supermarket industry ranks.

Similar to the retail drug industry, the supermarket industry experienced a trend of mergers and leveraged buyouts. In some shape or form, this affected all of the major chains. A&P was sold to Ervian Haub’s German Tengelmann Group. Later in the 1990’s it sold many stores across the Southeast to Kroger. Safeway became a private company in 1987 mostly to avoid a hostile takeover. In the late 1990’s however it began to aggressively acquire regional chains including Randall’s, Carrs and Dominick’s to re-enter some of its former territory. Also during this decade, Albertsons purchased American Stores. The biggest merger in Kroger’s history came in 1999, when the company purchased Fred Meyer, Inc. for $13 billion in a deal that created a supermarket chain with the broadest geographic coverage and widest variety of formats in the food retailing industry. Subsequently, these three chains (Kroger, Safeway, and Albertsons) were the dominant players in the industry, along with Walmart.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Supermarket, Grocery, & Convenience Store Industry 2000s

The supermarket industry during the 2000’s was largely defined by a series of mergers and acquisitions, as well as a number of emerging food trends, all of which have shaped the current state of the industry. Most notably, SUPERVALU was involved in two influential acquisition activities. In 2006, it acquired most of the Albertsons locations in addition to other regional chains including Acme, Jewel, and Shaw’s. The deal created a nearly $35+ billion retail and wholesale food company. The company proved too big for its own good, and it struggled to maintain efficiency while juggling its largest network ever of retail supermarkets with a successful wholesale grocery business. The deal seemed doomed from the start, and after years of declining store sales and underperforming stock prices, SUPERVALU again entered into another large deal. In 2013, the completed sale of all Albertsons and locations and other banners to Albertsons LLC/Cerberus reunited all Albertsons locations under one owner. The deal left SUPERVALU with only 200 retail stores, it’s still successful Save-a-Lot franchise network, and the wholesale business while Albertsons once again operates a network of 1,000+ retail locations.

The explosive growth and popularity of natural and organic foods as well as demand for healthy, on-the-go food options translated into similar growth for supermarket chains Whole Foods Markets and While Oats. In 2007, the two agreed to merge. The controversial deal went through a series of Federal Trade Commission decisions and antitrust law discussions. Ultimately the deal was allowed to proceed after Whole Foods agreed to close/sell some of the acquired locations. The combined company continues to experience tremendous growth today and is recognized as a trend-setting leader in the industry and has paved the way for other natural/organic food chains. Founded in 2002, Sprouts Farmers Market has grown to over 150 locations today through organic store growth and acquisitions, most notably Sunflower Farmers Market. In late 2013, British giant Tesco’s failed U.S. venture Fresh & Easy was sold to Yucaipa Companies with hopes to revive the struggling brand.

NewsRoom.ChainStoreGuide.com 1-800-927-9292 Supermarket, Grocery, & Convenience Store Industry 2010s & Beyond

The supermarket industry landscape has changed drastically over the past century. Looking forward, a number of distinct trends will continue to shape the way retail food is sold. Walmart will continue to be the dominant food retailing company, and will likely increase its market share. In addition to its supercenter format conversions and store openings, plans call for hundreds of Neighborhood Market store openings. This format is much smaller than a typical Walmart location and focuses strictly on food, competing directly with traditional supermarket chains. Growth from traditional chains will continue to focus on natural and organic retailers, with Whole Foods, Sprouts Farmers Markets and The Fresh Market leading. While not on the forefront yet, online grocery retailing could become more prevalent in the near future. Ahold’s Peapod subsidiary has been successful in this venue for years in the Northeast, and it is growing rapidly. Amazon also began to expand its fresh grocery delivery service in 2013, although only to a few select large markets.

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