Full Circle: Determination breeds the will to succeed
Published 9:24 am Friday, February 6, 2015
By 1921, Wallace Lee McLaughlin had remodeled the old Hormel Provisions Market into a modern day grocery store. He had grand designs for his new business and was determined to try them out on the people of Austin, just as he already had done in his first grocery store in Perry, Iowa.
His goal was to revamp the old system where the customer called in (or dropped off) her order, Wallace gathered the items, delivered them, and the customer paid at the end of the month. (And, by the way, the telephone number had only three digits!)
Grandpa felt there were many things wrong with this system. Why couldn’t the ladies come to the store, he thought, select their own groceries, pay, and get them home themselves? Why did he need a special delivery vehicle and a man to drive it? All these added up to money which the customers ultimately paid for. He had a much better idea. It was called self-serve.
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As a newcomer to Austin, he knew this was gutsy thinking. And worse yet , it was risky. More than anything, he needed to introduce himself to the local public where he could explain his plan. Here is the exact 1921 article from the Austin Daily Herald:
“To the people of Austin and vicinity, we introduce ourselves as The Square Deal Self Serve Grocery Co. A few words at this time may not be out of place. Our reputation for Truth and Accuracy in Iowa is “Good,” and our financial standing is Just and Fair. We are locating in Austin without friends and, bless you, without enemies, but from the first time we put our feet here, we liked the town and the people we met.
We believe there is room for a self serve grocery store in Austin. We did not come here to drive anyone out of business nor to cut and slash prices below a legitimate profit. We believe that what is best for Austin is best for us.
The money that we will make on groceries is based on a small margin of profit and we rely on a large volume of business to make us succeed. Frankly speaking, we figure a profit of 10 percent on gross sales. The great volume of business that we expect to do in Austin will enable us to sell groceries at amazingly low prices.
As an example, at our store in Perry, Iowa, a town of 5,000, our first month’s business was only $4,000. Our sixteenth’s was over $16,000. Naturally you ask how we did this. Our system of a cash flow at purchase time — and no delivery (thereby no bad debts) — eliminates overhead expenses. Volume is the whole story in our business. You will wait on yourselves, buying just what you want and then carrying it home. We do not have $1,000 tied up in a delivery vehicle nor do we have a $1200—a—year man to drive it.
Neither do we have high priced clerks to sell you something you do not want. Our store must not carry an overhead of more than 5 percent, sometimes only 4 percent. Thus you can figure on a saving of 10 percent with our system, meaning that with an annual business of $150,000, there will be a saving of $15,000 of which you will receive the benefit.
Now, a word about quality. We sell only nationally advertised groceries. Whenever possible, you will find our food of standard quality and we will give you positive satisfaction. Plus, do not worry, people. If you are not too proud to carry your groceries home, you will trade with us.”
A note from the Herald editor was added at the end of the article. “Just a word about the management of The Square Deal Grocery. You will find Mr. McLaughlin, the manager, to be an honest and Christian gentleman. I cannot speak too highly of him, as do his home people in Perry, Iowa where he was a resident for over thirty years. He is a gentleman in every sense of the word. Truly!”
Donaker of the Austin Daily Herald.
In the meantime, grandpa held his breath while he waited for the public’s reaction.