1979 Crash Hurried Magic Mart's End

by Jack Whitsett  on Monday, Mar. 31, 2014 12:00 am  

Dave Grundfest Jr. joined the company as a vice president, introducing a second generation to the family business.

The fun lasted until the next new wave hit retailing in the 1960s.

1962

Only one single year really matters in discount retailing: 1962. In that year, all three of the top chains in the field today began operating large stores that featured volume pricing and low overhead, though the three took divergent routes to the top.

New York variety retailer S.S. Kresge launched Kmart, Minneapolis department store chain Dayton-Hudson started Target, and Bentonville entrepreneurs Sam and Bud Walton opened Wal-Mart #1 in Rogers.

Kresge, Dayton-Hudson and the Waltons presented three models to the retailing community: variety retailer spins off discount operation, department store chain spins off discount operation and discount operation starts from scratch. (The Waltons held several Ben Franklin variety store franchises and continued to operate them after founding Wal-Mart.)

F.W. Woolworth soon followed with its Woolco chain, and before long it seemed discount stores were sprouting from every square yard of American soil.

By 1968, Kmart was far ahead of the other operations. The chain was well on the way to being a coast-to-coast operation, with revenue and profit that dwarfed all competitors. The variety store spinoff model looked pretty good to the experienced merchants at Sterling Stores, and Magic Mart was born.

“It became rather obvious that just as supermarkets were replacing grocery stores, so would a discount store take the place of a variety store,” Jack Grundfest said last week.

Grandson of the Sterling co-founder, Grundfest, now a Little Rock attorney, immersed himself in Magic Mart, working in all phases of the operation from summer work as a child to store setups.

Ben Johns, who had served as manager of the downtown Little Rock Sterling store, was tapped to spearhead the new division as operations manager, a position he held until he died in the plane crash.

Sterling and Wal-Mart both became publicly traded by 1970, and the two regional chains embarked on a war for the hearts of small-town America.

 

 

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