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How J.C. Penney Was Minted


The following is from the January 26, 2012, edition of The Wall Street Journal. Joan Gosnell, an archivist with SMU's DeGolyer Library, provided expertise for this story. In 2004, JCPenney donated its corporate archives and the papers of James Cash Penney (1875-1971) to SMU. The Penney Archives includes over 20,000 photographs, 1,500 linear feet of correspondence, speeches, ledgers, catalogs, and company publications documenting more than 100 years of corporate history as well as advertisements from 1903 to the late 1990's.

James Cash Penney in 1929
James Cash Penney in 1929

January 26, 2012



Before Ron Johnson could reinvent the 20th-century department store, James Cash Penney had to help invent it. And even though their efforts are separated by 110 years, they've got a few tricks in common, including trying to set prices low and hold to them.

Mr. Penney founded his eponymous chain of stores in 1902 at age 26. As lore has it, he was a religious man disenchanted by a retail environment overrun by snake-oil salesmen, saloons and murky pricing.

Unlike most retailers of the time, Mr. Penney priced items low and didn't permit haggling, according to the J.C. Penney Museum. Now, Mr. Johnson, alarmed by J.C. Penney Co.'s heavy reliance on discounting, is making a similar move to low, steadier prices, beginning in February.

Born on a farm near Hamilton, Mo., in 1875, Mr. Penney later moved out West on the advice of his doctor, seeking a drier climate. In Wyoming in 1898, he took a part-time job as a sales clerk at a store called Golden Rule during the holiday rush and stayed on after Christmas. Its credo was "only doing unto others as you would have them do unto you." The owners became impressed by his work and made him a partner.

Mr. Penney began scouting locations for the small but growing West Coast chain.

His first pick was an unlikely location—Kemmerer, Wy.—a coal-mining town brimming with saloons and brothels, says Joan Gosnell, an archivist at the J.C. Penney Collection at DeGolyer Library at Southern Methodist University. His partners tried to dissuade him, but on the store's first day it brought in $466, a formidable sum for the time, Ms. Gosnell says.

By 1906, Mr. Penney had bought out his original partners. In 1913, he changed the chain's name to J.C. Penney. Penney's grew to 175 stores in 22 states and registered sales of $14 million in 1917, according to papers compiled by the DeGolyer Library.

Penney incorporated in Delaware in 1924. Americans looking for bargains flocked to its stores during the Great Depression.

The retailer also had a writerly streak, with much of his work aimed at spreading his wholesome philosophies about work and commerce. One on display at a museum at Penney's headquarters in Plano, Texas, is titled, "The Homely Philosophy of the Man With a Thousand Partners." It covers Mr. Penney's policy of interviewing and grooming future partners before sending them out to manage stores.

A museum still stands in his hometown of Hamilton, which celebrates Mr. Penney's life each year in June.

Says Ms. Gosnell, "He's squeaky clean."

Thanks to a grant from the JCPenney Company Fund, Inc., a selection of the company's earliest newspaper, The Dynamo, has been digitized and is available online.

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