It was the anchor of Main Street, where generations went for a thimble, a mop or even a bite to eat.
But the dime store era officially came to an end Thursday with Woolworth Corp.’s announcement that it would shutter all its 400 remaining five-and-dime stores nationwide and lay off 9,200 workers.
Faced with unbeatable competition from Wal-Mart Stores Inc. and other big discounters, F.W. Woolworth stores couldn’t survive as shoppers left downtown America for giant malls and outlet centers.
“Woolworth was the last of the five-and-dime stores,” said Kurt Barnard, a retail consultant and president of Barnard’s Retail Marketing Report. “Years back people depended on five-and-dimes for everything; today others fill those needs.”
Woolworth was the original five-and-dime store, founded in 1879 in Lancaster, Pa., by Frank Woolworth. The stores boomed in prewar downtowns and became fixtures in suburban strip shopping centers.
Others, like McCrory Corp. and Ben Franklin, copied its concept, offering shoppers a mix of merchandise from beach chairs to beauty aids, all under one roof. They, too, have fallen in recent years, both landing in bankruptcy court.
Woolworth even played a role in the civil rights movement. After four black students were denied lunch at its Greensboro, N.C., store, a 50-city protest erupted and Woolworth eventually changed its discriminatory practices in 1960.
But the heyday of F.W. Woolworth is long gone. Last year, the five-and-dime stores in the United States reported an operating loss of $37 million and only accounted for $1 billion of Woolworth Corp.’s annual sales of over $8 billion.
“Closing of the Woolworth stores is long overdue,” said retail consultant Walter Loeb. “Today’s Woolworth store was just not viable.”
That’s become especially true as consumers’ shopping habits shift to discount stores and specialty retailers.
Chains like Wal-Mart and Target offer a broader base of merchandise and better prices.
And local retailers like big drug stores and supermarkets now provide shoppers with much of the same merchandise that used to draw them to Woolworth.
Over the years, Woolworth has tried to address changing customer needs. In 1962, it even opened its own discount chain, Woolco, but those stores never carved out a market niche in the United States and were closed in 1982.
Over the last decade, Woolworth has been tinkering with its store mix, closing thousands of stores and slashing thousands of jobs. But the restructuring wasn’t enough to reduce losses and save the Woolworth stores - over the past five years, the company’s general merchandise store holdings fell from 1,465 to the current 400.
“This company has invested significant resources in trying to revitalize the F.W. Woolworth chain, including time, money and management’s attention,” Roger Farah, Woolworth’s chairman and chief executive, said in announcing the decision Thursday.
“However, despite our best efforts and the hard work of the F.W. Woolworth team, the business continued to lose money and it became clear that F.W. Woolworth would be unable, in the foreseeable future, to return to profitability as well as meet our minimum performance standards,” he said.
Woolworth’s efforts will now go into its more profitable Foot Locker, Champs sporting goods, Northern Reflections apparel shops and other stores. About a quarter of the closed F.W. Woolworth stores will be converted to Champs, Foot Locker and other shops.
In addition, the company plans to change its corporate name from Woolworth Corp. A new name will be announced later this year.
Once closings take place over the next several months, the only remaining Woolworth stores will be in Germany and Mexico.
MEMO: This sidebar appeared with the story: LOCAL IMPACT Woolworth’s last Spokane store, at NorthTown Mall, closed in 1990.
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