Piggly Wiggly was
the first true self-service grocery store. It was founded on
September 6, 1916, at 79 Jefferson Avenue in Memphis, Tennessee, by
Clarence Saunders. A replica of the original store has been
constructed in the Memphis Pink Palace Museum and Planetarium, a
mansion that Saunders initially built as his private residence but
was later sold to the city.
Piggly Wiggly Corporation secured the self-service format and
issued franchises to hundreds of grocery retailers for the
operation of its stores. The concept of the "self-serving store"
was patented by Saunders in 1917. Customers at Piggly Wiggly
entered the store through a turnstile and walked through four
aisles to view the store’s 605 items sold in packages and organized
into departments. The customers selected merchandise as they
continued through the maze to the cashier. Instantly, packaging and
brand recognition became important to companies and consumers.
Without self-service, modern branded packaged goods, as we know
them, would not exist.
Piggly Wiggly was the first to:
* provide checkout stands.
* price mark every item in the store.
* feature a full line of nationally advertised brands.
* use refrigerated cases to keep produce fresher longer.
* put employees in uniforms for cleaner, more sanitary food
handling.
* design and use patented fixtures and equipment throughout the
store.
* franchise independent grocers to operate under the self-service
method of food merchandising.
The success of Piggly Wiggly was phenomenal, so much so that
other independent and chain grocery stores changed to self-service
in the 1920s and 1930s. At its peak, the company operated 2,660
stores and posted annual sales in excess of $180 million. In
November 1922, Saunders attempted a squeeze on the substantial
short interest in the stock, running the share price up from 40 to
120 and profiting by millions on paper. The Stock Exchange
Governors responded by deciding that a corner had been established
in Piggly Wiggly and removed the stock from the Board eventually
forcing Saunders to turn over his assets to the banks that had
financed his leveraged position. Saunders reputedly lost nine
million dollars in the attempted corner.
Following these events, the company was divided into strategic
units and sold to regional grocery chains, including Kroger,
Safeway, National Tea, and Colonial.
After losing control of Piggly Wiggly, Saunders had no further
association with the company although he remained interested in the
concept of automated shopping which he experimented with initially
with the Keedoozle store until his death in 1953.
The smaller Piggly Wiggly Corporation continued to prosper as
franchiser for the hundreds of independently owned grocery stores
licensed to do business under the Piggly Wiggly name. During the
decades following the 1920s divestment, the company has operated
successfully under a variety of owners.
Management of the Toyota Corporation were inspired by Piggly
Wiggly's Just-in-time inventory strategy and used this model to
develop its Toyota Production System (TPS), a philosophy by which
the company organizes its manufacturing and logistics, including
its interactions with suppliers and customers.
Source: Wikipedia
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