PENNEY, JAMES CASH 1875-1971

CHAIN STORE OWNER

Modest Beginnings

James Cash Penney was born in Hamilton, Missouri. When he was eight years old his father decided that he must begin to buy his own clothes, and he earned enough that year to buy a pair of shoes. He was educated in the public school of his hometown and graduated from high school in 1893. Two years later he began his career as a clerk in a general store in Hamilton. In 1897 he went to Denver, Colorado, where he was a clerk in a department store, later moving to Longmont, Colorado. Penney started a meat and bakery business that was not a success, but as a result he went to work for T. M. Callahan, drygoods merchant of Johnson and Callahan, whom Penney called "the man who gave me my great opportunity in life."

The Start of a Chain

In 1899 Callahan sent Penney to his store in Evanston, Wyoming, and in 1902 sent him to open a new store in the frontier town of Kemmerer, Wyoming. Penney was given the opportunity to purchase a one-third partnership in the enterprise, which had a capital stock of $6,000. Penney borrowed __BODY__,500, added $500 of his own savings, and on 14 April 1902 opened the Golden Rule store. Opening-day receipts of Penney's first store, open from dawn to midnight, were $466.59. By the end of the first year the store had done $29,000 worth of business. This experience convinced Penney that a chain of similar stores under a partnership-ownership agreement would be successful. The expansion of Penney's company into a national chain was made possible by the developing national transportation and communication infrastructure.

Expansion

By 1907 Penney had acquired forty-eight stores and located his headquarters in New York City. Instead of opening one store at a time, Penney began to purchase whole chains of stores. By 1929 the J. C. Penney Company owned 1,450 stores and had reached annual sales of $209 million. Even during the Depression expansion continued, and the total of stores in the chain rose to 1,600 by 1941. Penney opened an average of one new store every ten days for forty years.

Philosophy

Penney never touched alcohol or tobacco and for many years forbade his employees to do so. He believed "that anyone and everyone has in him the latent capacity to become a human dynamo, capable of accomplishing anything to which he aspires." To his employees he stressed energy, integrity, and loyalty. He made it a policy to offer a new executive less than he had been paid in his previous job, as a test of loyalty and faith—and as a measure of thrift. Late in his life, when his chain had grown to become the nation's fifth largest merchandising operation with annual sales of more than $4 billion, he proclaimed that "the company's success is due to the application of the Golden Rule to every individual, to the public, and to all of our activities." In the early days of J. C. Penney many of his stores had been called Golden Rule stores as part of his philosophy that business had to follow the Golden Rule. Later they were all called J. C. Penney stores. A Democrat and a Baptist, Penney was an ardent supporter of Prohibition. In 1925 he built the Memorial Home Community in Florida at a cost of __BODY__.25 million to house aged religious workers.

Sources:

Norman Beasley, Main Street Merchant: The Story of the J. C. Penney Company (New York: Whittlesey House, 1948);

John Brooks, The Autobiography of American Business (Garden City, N.Y.: Doubleday, 1974);

J. C. Penney, SO Years with the Golden Rule (New York: Harper, 1950);

Penney, View from the Next Decade: Jottings from a Merchant's Daybook (New York: Nelson, 1960).