Montgomery Ward's History

by Contributing Writer - Updated September 26, 2017

Montgomery Ward, which was incorporated in 1889, has no more stores with the "Montgomery Ward" name but has more than 400 stores in more than 43 states, touting sales in the billions under other titles. These brands include Rooms&more, Auto Express, The Apparel Store and Gold N' Gems. It is estimated that the company has more than 60,000 employees nationwide. Throughout Montgomery Ward's decades, the company has gone through many reiterations to stay competitive.

Beginnings

Chicagoan Aaron Montgomery Ward set out in 1871 to undercut rural retails by selling directly to farmers via mail order. Initially, things moved at slow pace, so much so that his partners decided to bail on the venture. He decided to move forward with distributing his catalog to rural farmers, even though most of his inventory was destroyed during the Great Chicago Fire. The first catalog for Montgomery Ward was distributed in 1872 and was an 8-by-12-inch single-sheet price list, which listed 163 items for sale. Ward wrote the catalog.

Illinois Grange

A break occurred for Ward when the Illinois Grange decided to name Ward its purchasing agent. This gave Ward access to mailing lists, and his business began to grow. Running short on capital, Ward turned to his brother-in-law, Richard Thorne, who invested in the company and became a partner, managing the day-to-day aspects of the business.

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1875 Slogan

The company continued to grow because Ward offered goods to rural communities that they could not find elsewhere. In 1875, Ward started using the slogan "Satisfaction guaranteed or your money back," with great success. During this time, Ward also became active in the community, for which he gained much recognition, especially for his work in establishing parkland along Lake Michigan.

The Wish Book

By 1883, Montgomery Ward's catalog had gained much steam and was even dubbed "The Wish Book." The catalog was 240 pages and had 10,000 items. Unfortunately, in 1896, others began to take note of Ward's success, and competition entered the playing field. The first serious competitor was Alvah Roebuck, co-founder of Sears, Roebuck and Co., who mailed out his catalog.

Catalog Warehouse

Because of large demand and sales of more than $8.5 million, Montgomery Ward opened a catalog warehouse in Chicago known as Montgomery Ward & Co. Catalog House. It was the company headquarters until 1974 and continues to be a historic landmark.

First Retail Outlet

In 1908, Montgomery Ward opened its first retail outlet in Plymouth, Indiana. By 1928, it was operating more than 244 stores. Its flagship store was on Michigan Avenue in Chicago between Madison and Washington streets. After World War II, Montgomery Ward was the third-largest chain of department stores in the country.

Downfall

The company continued on a popular path until 1950, when Americans began settling in suburbia, and malls started sprouting up everywhere. Montgomery Ward thought it too expensive to invest in these areas, and soon its catalog business was declining. The company soon merged with Container Corp. of America and became Marcor Inc. In the 1970s, the company continued to struggle and was acquired by Mobil Oil, which brought great cash infusion. The company decided that after 113 years, it was time to close the catalog business. Unhappy with the arrangement, the company's management undertook a successful $3.8 million leveraged buyout by 1988.

Unfortunately, in the 1990s, Montgomery Ward lost ground to competitors such as Wal-Mart and Target. In 1997, the company filed for bankruptcy. In 2000, it formally announced it was going out of business, after seeking help from General Electric. In 2004, the company was resurrected in Cedar Rapids, Iowa, as an online retailer and continues with diversified store offerings throughout the nation.

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