History of Retailing


store, commonly a shop or stall for the retail sale of commodities, but also a place where wholesale supplies are kept, exhibited, or sold. Retailing—the sale of merchandise to the consumer—is one of the oldest businesses in the world and was practiced in prehistoric times.

Total retail sales, which include both retail stores and eating establishments, topped $2.7 trillion in the United States in 1998. Currently, there are over 1.5 million retail establishments employing over 19.8 million people. Most are small. One third of all retail establishments have no paid employees; about 43% have fewer than 10 employees. Larger stores, with over $500,000 in annual sales, account for three quarters of all retail sales. The 50 largest retailers control about one fifth of the market, and stores with ten or more branches account for 95% of all department store sales, 56% of all drugstore sales, half of all shoe sales, and 57% of all grocery store sales.

The Development of Retail Stores

The earliest form of retail merchandising was probably the exchange of food and weapons; later came traders and peddlers, and by 3000 BC shops had become common. During the Greek and Roman period, stores, including many specialty shops, developed in the form of open booths, attracting large cosmopolitan crowds. After the decline of the Roman Empire, barter became more important, but by the 14th cent. retail trade again assumed importance. Merchants, who in early times were viewed with suspicion, rose in the social scale. Small stores, each carrying its special line of goods, reached their peak in the 18th cent. The wholesale business developed, and traveling salesmen and standard prices came into general use.

In the United States the general store preceded the single-line store and is still common in small rural communities. In the late 19th cent. the department store came into being—a large-scale general store or a combination of single-line stores in which each line of merchandise is operated as a separate department. Such stores provide the convenience of easy accessibility to a large variety of goods. Modern department stores have been vital to the development of shopping centers and malls, huge retail developments that contain a wide variety of stores and services.

Retail concerns that do business principally through the mail are called mail-order houses. In the United States among the first and largest were Montgomery Ward (founded 1872) and Sears, Roebuck, & Company (founded 1886), which sold their goods to rural residents by means of annual catalogs. Both later developed warehouses and retail stores in many urban communities; Montgomery Ward closed in 2001, and Sears was merged with Kmart to become a subsidiary of the Sears Holdings Corporation in 2005. Many mail-order houses now also depend on orders placed over the telephone and via the Internet. Development of the World Wide Web on the Internet has given rise to companies, such as Amazon.com, that sell goods exclusively through an Internet site, or on-line "store," shipping purchases by mail or other carriers.

Chain stores, though known in earlier times, first developed their modern form in 1859, when the Great Atlantic and Pacific Tea Company (A&P) standardized the quality and price of all merchandise sold in its stores. Through central management, quantity purchasing, standardization of business methods, and limited individual service, the chains are often able to sell their goods well below prices charged by independent stores. Chain stores were once typified by five-and-ten-cent stores (e.g., F. W. Woolworth Company, which operated such stores until 1998), but the most common forms now are discount superstores (e.g., Wal-Mart; see Walton, Sam), bakeries, tobacco stores, drugstores, groceries, and department stores.

Consumers' cooperative stores (see cooperative movement) have been established in Europe and the United States. Discounting merchandise became widespread after World War II, and stores specializing in discounted merchandise have become the fastest growing segment of the retail industry. The "discount club," where shoppers must pay a fee to become members and name-brand products are sold at a discount (often packaged in multiples or very large containers), became popular in the 1990s.


See G. M. Lebhar, Chain Stores in America, 1859–1959 (3d ed. 1963); R. Hendrickson The Grand Emporiums (1979); D. Bellenger and J. I. Goldstucker, Retailing Basics (1983); M. Levinson, The Great A&P (2011).

The Columbia Encyclopedia, 6th ed. Copyright© 2015, The Columbia University Press.

History of Retailing: Selected full-text books and articles

Carried Away: The Invention of Modern Shopping By Rachel Bowlby Columbia University Press, 2001
Chain Stores in America, 1859-1962 By Godfrey M. Lebhar Chain Store Pub. Corp., 1963 (3rd edition)
Lessons from the Wal-Mart Wars By Epstein, Richard A Chief Executive (U.S.), No. 220, September 2006
Franchising in America: The Development of a Business Method, 1840-1980 By Thomas S. Dicke University of North Carolina Press, 1992
Specialty Retailers: Marketing Triumphs and Blunders By Ronald D. Michman; Edward M. Mazze Quorum Books, 2001
John Wanamaker: Philadelphia Merchant By Herbert Ershkowitz Combined Publishing, 1999
A Sales Floor in the Sky: Philadelphia Department Stores and the Radio Boom of the 1920s By Arceneaux, Noah Journal of Broadcasting & Electronic Media, Vol. 53, No. 1, March 2009
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