Independent stores for specialty and expensive items

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independent stores for specialty and expensive items A Challenger Emerges (1950-4) 1950 Simpson’s began business venture in Canadian retailing Edgar Burton become general manager of the Toronto Simpson’s store and became president of Simpson’s 1948 Sears in the 1930s General Robert Wood Chairman of the Sears Roebuck Anti-chain-store Act in US: directly protecting the independent retailer from chain-store competition, but it was also strongly supported by wholesalers eager to prevent large chain stores from buying directly from the manufacturers for lower prices Wood decided to gain public support towards a capitalist enterprise 1. Wood decided to abolish the traditional way dealing with smaller banks by not transferring money from smaller banks to larger central banks to gain support of bankers who are usually influential community members The strategy did increase public support 2. Providing agricultural scholarship funds, financing community-improvement projects and requiring store managers to take prominent (important) social and charitable roles in their store community and commissioned ‘agency stores’-contracted to sell merchandise Corporate citizenship strategy and his managerial skills enabled the company to be very profitable and expanded to south and central America but not Canada, which he saw as a relatively smaller market Working out a deal: The Joint Venture Wood offered a partnership with Burton and was accepted with the condition that mail-order service cannot be eliminated The added capital and opportunity to allow Simpson’s to expand to new territories contributed to the acceptance
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1952 Simpsons-Sear Ltd the new joint venture formed on a 50-50 basis-Burton was the president and CEO The existing Simpson stores remain independent and agreement were established to prevent new S-S store from opening within 25miles Due to patriotism the new joint venture claimed to be ‘Distinctly Canadian’ and promised 85% of goods sold were made in Canada. Sears’ huge buying power contributed to the benefit of the partnership Sears required all Simpson’s buyers and sales executives to be trained in the Sears merchandising system Two companies complemented each other, sears specialized in hard good-appliances and hardware and Simpson in soft good-clothing, which attracted wider customer base Unlike Eaton’s S-S was a public company who offers profit sharing plan to employees Eaton was fear of new competition from S-S so attempted to appeal to Canadian nationalists and identified itself of more Canadian Capturing the New Market: The Growth of the Suburbs Wood noticed change of demographic in suburb and sat up stores in US suburbs after WWII S-S followed Wood’s approach and established store in suburb areas They analyzed various factors, including city population, income characteristics, and business volumes of other stores. They also looked at population density maps to verify the direction of residential development, roads in suburbs to anticipate traffic flows
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