Donald – I don’t think that anyone who has even read a few historical anecdotes in a business magazine seriously believes that any business is “supposed” or likely to last forever. And for some odd reason I have always been fascinated by the dynamism and mutability seen in the rise and fall of major businesses. For example, I remember as a little kid being fascinated that at one time A&P and Safeway were the number 1 and number 2 supermarket chains in America (although it was more a fascination with numbers than business that burned this little factoid into my mind). Later, looking it up in an encyclopedia, I learned that A&P had first come into prominence in the tea business, and only later transformed itself into a grocery giant.

There are surprisingly few truly old companies in America. DuPont, one of the oldest continuing companies in the US, was originally founded as a gun powder mill in 1802. But of the original twelve companies that made up the Dow Jones Industrial Average in 1896, only one company, General Electric, is still represented.

The history of Sears is fun because it has echoes of the later success of amazon.com. The catalog allowed people in small cities and on farms to “see” merchandise without having to travel to a large town with a well-stocked general store. And reliable delivery and a widely spread word-of-mouth reputation for high quality products (like the Kenmore line) made Sears a household name. But times change, and Sears, like the A&P, is more a part of business history than the retail present (almost as forgotten as original Sears partner and co-founder Alvah Roebuck).

Killer concepts cannot withstand changes in time and taste. Men’s clothing stores have declined in large part because middle class men don’t regularly wear suits to work or generally in public (e.g., to restaurants and ballparks), as trends toward informality in clothing continue and accelerate.

A killer concept in Southern California that is already starting to fade is the mixed retail/residential complex, a bad solution desperately looking for a problem.

For a bit of fun, watch Kubrick’s “2001: A Space Odyssey,” and note the companies which have merged, disappeared or dropped in prominence since the time the movie was made.

Kurt – The Grove shopping mall in Los Angeles is an outrageously fun place to watch hot looking women (supplanting the Beverly Center and the Century City Mall). In fact, it is clear that some of the women deliberately dress up (or barely dress at all) in order to be seen, not necessarily to shop.

Posted by: Alec on August 2, 2006 6:45 AM

Donald,
Thanks for a trip down Memory Lane. Korvette's!!! In central NJ, back in the day when strictly record stores were all in NYC or Philly, Korvette's provided a cultural stop for that longer-haired, pimpled, under-nourished, cheap t-shirted crowd of young men that I was a car-carrying member of. A singular emmory comes back now. It's Christmas time and the parents are trying to bridge that chasm between themselves and myself that seems to widen in the 14-18 year time span.
"So, what would you want for Christmas?"
"(Garble, Garble, Gobble, Gobble) How about Grateful Dead's "Workingman's Dead"?, I say, while slinking off, trying to maintain my affected distance.
My mother goes to Korvette's and successfully scores on the request. It wasn't until a few months later that I found out from a friend who worked in the records section that he had seen her in the store, looking for the Holy Grail I'd requested of her. At one point, exasperated with the bizarrely named artists, she must have had it. She went to a clerk and asked for music of the Grating Dead People. She explained that her son had the "teenage complexes" and this music was part of the "things you go through" to get to adulthood. Having a fairly heavy Slavic accent probably only added to the entertainment value for the clerk. My friend said my mother was involved with the selection/search for at least a good hour.
She finally was able to leave with the album clutched under her arm. I still have the album; it's one of my most cherished gifts, knowing my mother was more than willing to embarass herself to grant my request.
GratinG Dead and Korvette's. Permanently burned in the skull.

Posted by: DarkoV on August 2, 2006 7:48 AM

"A killer concept in Southern California that is already starting to fade is the mixed retail/residential complex..."

Otherwise known as -- the traditional city.

Posted by: ricpic on August 2, 2006 10:37 AM

Ricpic – Oddly enough, there are few things that are traditional in Southern California. But even here, one of the problems with the retail/residential mania is that developers are taking perfectly serviceable neighborhoods and attempting to make them ultra-gentrified and upscale, but against not only the wishes of the residents, but also the area demographics. A couple of quick examples: The Hollywood/Highland complex was designed in part to attempt to draw upscale tourists and locals from Beverly Hills and Santa Monica. But no one cared or noticed that the people who typically come to this area are middle class, and spend a considerable amount of money. But their money wasn’t sexy enough. So the developers and politicians filled the complex with expensive upscale shops and restaurants, and made local parking hideously expensive. The result: the upscale hipsters stayed away in droves ‘cause they didn’t care, and the middle-class tourists who still regularly come to the area simply refuse to spend money for overpriced commodities, and the food court with the cheapest and most familiar eateries do much better than the high-end places. So the upscale shops are closing up, but the leases are too high to attract more suitable replacements.

Similar problems occurred with mixed retail/residential complexes in the San Gabriel Valley. The people who live in the complexes still go elsewhere to shop, and the locals cannot afford to shop there, and the upscale shops initially courted for these places move out, often leaving empty hard-to-fill holes. And yet developers and politicians press on, convinced that this totally artificial kind of gentrification is the wave of the future.

Posted by: Alec on August 2, 2006 2:29 PM

The continuous thread which runs through the evolution of retail formats over time is less personal service. This has been driven quite simply by trends in the relative cost of employing people versus real estate, inventory and computer information systems.

As our society gets richer, people (especially including their health care costs) have become and will continue to become more expensive relative to everything else.

Posted by: ZF on August 2, 2006 10:01 PM






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