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Montgomery Ward

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Montgomery Ward Inc.
Company typeTemplate:Plain list
IndustryRetail
FoundedTemplate:Plain list
DefunctTemplate:End date and age (original company)
FateBankruptcy filed in 2000; complete liquidation finalized in 2001; brand relaunched in 2004 following trademark acquisition
HeadquartersTemplate:Plain list
Key people
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ProductsApparel, footwear, bedding, furniture, jewelry, cosmetics, appliances, housewares, tools, electronics
BrandsTemplate:Plain list
ParentTemplate:Plain list
DivisionsTemplate:Plain list
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Montgomery Ward refers to two successive retail enterprises based in the United States. The original Montgomery Ward & Co. began as a mail-order business before evolving into a department store chain that operated from 1872 until its closure in 2001; it was colloquially known as "Monkey Wards". The current Montgomery Ward Inc. functions as an online shopping and mail-order catalog merchant, established several years after the original company's dissolution.

Company origins

Aaron Montgomery Ward initiated his enterprise in Chicago; sources differ on whether his initial office was a single room at 825 North Clark Street or a loft above a livery stable on Kinzie Street between Rush and State Streets.

By 1883, the catalog had expanded to include 10,000 products across 240 pages. In 1896, the firm faced its first significant mail-order competitor when Richard Warren Sears launched his general catalog. In 1900, Montgomery Ward reported sales totaling $8.7 million compared to Sears’ $10 million, with both companies competing for market leadership throughout much of the twentieth century. By 1904, the company was distributing three million catalogs annually, each weighing approximately 4 lb (1.8 kg).

In 1908, Montgomery Ward unveiled a 1.25-million-square-foot (116,000 m2) facility along nearly one-quarter mile of the Chicago River north of downtown Chicago. This building, known as the Montgomery Ward & Co. Catalog House, served as corporate headquarters until 1974 when operations moved to a new office tower designed by architect Minoru Yamasaki. The Catalog House received designation as a National Historic Landmark in 1978 and was recognized as a Chicago historic landmark in May 2000.

Prior to 1930, Montgomery Ward developed a nationwide distribution network consisting of large reinforced concrete warehouses situated in cities including Baltimore, Fort Worth, Kansas City, Oakland, Portland, and St. Paul. These facilities were often the largest industrial buildings within their respective regions. The Baltimore location—the Montgomery Ward Warehouse and Retail Store—was listed on the National Register of Historic Places in 2000.

Growth into retail stores

In 1926, the company departed from its exclusive mail-order model by launching its inaugural retail store in Plymouth, Indiana. While maintaining its catalog operations, it aggressively expanded its physical retail presence throughout the late 1920s. By 1928, just two years after opening its first location, the company had established 244 stores. This number more than doubled to 531 outlets by 1929. The prominent flagship store was situated on Michigan Avenue between Madison and Washington streets in Chicago.

In 1930, the firm rejected a proposed merger with competitor Sears. Amid financial losses during the Great Depression, Montgomery Ward’s key investors—including J. P. Morgan, Jr—became concerned about the company’s stability. Consequently, in 1931, Morgan appointed Sewell Avery as president. Avery implemented significant changes such as reducing workforce size and store count, revising product lines, appointing store managers instead of catalog managers, and renovating retail locations. These measures enabled the company to return to profitability before the decade concluded.

Montgomery Ward excelled in retail operations with its "green awning" stores present in numerous small towns nationwide, while larger outlets served major urban centers. By the late 1930s, it had become the largest retailer in the United States, with Sewell Avery ascending to the role of chief executive officer.

Federal government intervention

In April 1944, amid a nationwide strike involving 12,000 employees that had lasted four months, U.S. Army forces took control of Montgomery Ward’s Chicago headquarters. This intervention was prompted by Avery’s refusal to resolve the strike as urged by the Franklin D. Roosevelt administration, which was concerned about disruptions to wartime goods distribution.

Avery declined to follow a directive from the War Labor Board mandating recognition of unions and implementation of a collective bargaining agreement. After eight months of continued noncompliance, President Roosevelt issued an executive order seizing all Montgomery Ward properties across the country under authority granted by the War Labor Disputes Act and his constitutional powers as commander-in-chief. The seizure ended in 1945 under President Harry S. Truman, and the Supreme Court dismissed a related appeal as moot.

Post War

File:182 Main Street Brattleboro detail.jpg
Progress Lighting the Way for Commerce, a medallion designed by sculptor J. Massey Rhind for Montgomery Ward, was featured at numerous Ward locations. This example is from Brattleboro, Vermont.
File:Montgomery Ward - 1968 (color).svg
Montgomery Ward emblem used between May 1968 and July 1982
File:Pre-Wardslogo.png
Montgomery Ward logo utilized from 1995 to 1997

Following World War II, Sewell Avery anticipated an economic downturn, possibly a recession or depression. Consequently, he opted against opening additional stores and even restricted spending on maintenance such as repainting existing outlets. His strategy focused on accumulating profits to maintain liquidity for acquiring competitors when the expected economic slump arrived.

Due to the absence of expansion and reinvestment, Montgomery Ward's sales lagged behind those of Sears. Many critics attribute this decline to Avery’s cautious approach, which appeared out of touch with the evolving postwar economic landscape. As new shopping centers emerged, Sears secured more favorable locations than Ward. Nevertheless, Montgomery Ward remained the third-largest department store chain in the country for many years.[1][2]

In 1955, investor Louis Wolfson launched a prominent proxy fight to gain control over Montgomery Ward's board. This led to Avery’s ousting by the newly empowered board members. The legal battle culminated in an Illinois state court ruling that corporations in Illinois could not implement staggered board member elections.[3]

By 1961, John Barr, then company president, appointed Robert Elton Brooker as president to spearhead Montgomery Ward’s recovery efforts. Brooker introduced several key executives, including Edward Donnell, formerly overseeing Sears’ Los Angeles stores.

This revamped leadership team streamlined operations by cutting suppliers from 15,000 to 7,000 and reducing carried brands from 168 to just 16. The company significantly boosted private label sales from 40 percent in 1960 to 95 percent of total volume.

These initiatives resulted in reduced handling expenses and improved quality controls. While purchasing became centralized, store management was decentralized under a territory system inspired by Sears.[4]

In 1966, Ed Donnell succeeded as company president while Brooker remained chairman and CEO until 1976. Two years later, Brooker facilitated a friendly merger with Container Corporation of America, forming a new parent entity named MARCOR.[5]

Despite this merger, challenges persisted through the 1970s. In its 102nd year (1973), Montgomery Ward acquired Miami-based discount chain Jefferson Stores, rebranding them as Jefferson Ward.[6] Following the 1973 oil price surge, Mobil purchased a controlling stake in MARCOR in 1974 and fully acquired it by 1976.

Montgomery Ward was an early participant in the home computer market with the CyberVision 2001 in 1978, created by Authorship Resource, Inc., of Franklin, Ohio, and mainly produced by United Chem-Con. However, competition and manufacturing issues led to discontinuation of the CyberVision product line by the early 1980s.[7]

By 1980, Mobil recognized that Jefferson stores were outperforming Montgomery Ward locations and decided to expand high-quality discount outlets modeled after companies like Target.

Within a year and a half, management increased Jefferson Ward’s footprint fivefold to over 40 stores across the Delaware Valley and Richmond areas. Plans were made to convert about one-third of Montgomery Ward’s stores into Jefferson Ward formats.

The small Jefferson team struggled with this rapid expansion due to limited experience handling some product categories and unfamiliarity with northern markets.

As a result, Jefferson shifted from modest profitability to becoming a significant financial liability.[8] In 1985, the northern division’s 18 stores were sold to Bradlees, part of Stop & Shop, with remaining locations shuttered.[9]

Also in 1985, after more than a century of operation, Montgomery Ward ended its catalog business and initiated extensive renovations across its remaining stores. Many urban and upscale neighborhood outlets were redesigned into boutique-style specialty shops aimed at competing with traditional department stores.

In 1986, Mobil divested Container Corporation of America—another MARCOR subsidiary—effectively dissolving MARCOR and making Montgomery Ward a direct Mobil subsidiary. Analysts interpreted this move as Mobil retracting its diversification strategy amid mounting debt pressures linked to MARCOR’s acquisition; speculation grew that Montgomery Ward might be next for divestiture.

These suspicions were confirmed in January 1987 when Mobil announced plans to explore spinning off Montgomery Ward.

In March 1988, company leadership completed a leveraged buyout valued at $3.8 billion (~$Template:Format price in Template:Inflation/year), transitioning Montgomery Ward into private ownership.[10]

Bankruptcy, restructuring, and liquidation

File:Wards - 1997.svg
In 1997, the brand identity was simplified to "Wards," a logo that remained until the chain's closure in 2001.

During the 1990s, even competitors began to falter under intense low-cost rivalry from companies such as Target and Walmart, which further diminished Montgomery Ward's established clientele. In 1997, the company sought relief by filing for Chapter 11 bankruptcy. It emerged from bankruptcy protection granted by the United States Bankruptcy Court for the Northern District of Illinois in August 1999, becoming a fully owned subsidiary of GE Capital, which had become its largest shareholder.

In an effort to regain market relevance, Montgomery Ward shuttered more than 100 stores across 30 states, discontinued its specialty store approach, rebranded itself simply as Wards, and invested heavily in modernizing its remaining locations to create a more appealing shopping environment. However, GE Capital withdrew promised additional financial backing for Montgomery Ward’s turnaround initiatives.

Following disappointing holiday sales in December 2000, the company announced on December 28 that it would halt operations entirely, close its final 250 stores, and lay off approximately 37,000 employees.

As online retailer

At its peak, the original Montgomery Ward ranked among America's largest retail chains. After its closure, the brand’s recognition rendered its name, logo, and promotional materials valuable intellectual property. In 2004, Direct Marketing Services Inc. (DMSI), an Iowa-based direct marketing firm, acquired significant intellectual property rights from the former Montgomery Ward organization, including the trademarks "Montgomery Ward" and "Wards," for an undisclosed sum.

DMSI launched a new retail operation using the Montgomery Ward brand focused exclusively on online and catalog sales without any physical storefronts. Headquartered in Cedar Rapids, Iowa, the company began operating under this branding in June 2004, offering many similar product categories as its predecessor. This new entity did not assume responsibility for prior obligations such as outstanding gift cards or lifetime guarantees. David Milgrom, then president of DMSI’s Montgomery Ward division, stated to the Associated Press that their goal was to rebuild the brand with integrity.

In July 2008, DMSI announced plans to sell its assets via auction scheduled for the following month. On August 5, 2008, Swiss Colony acquired DMSI. Swiss Colony later rebranded itself as Colony Brands Inc. on June 1, 2010. The company revived Montgomery Ward by relaunching its website on September 10, 2008, followed by new catalog mailings in February 2009. Prior to the catalog’s release, Swiss Colony President John Baumann indicated to United Press International that there were intentions to revive classic Montgomery Ward store brands such as Signature and Powr-Kraft. Under Colony Brands’ stewardship, Wards introduced new private labels including a home and kitchen line named Chef Tested. By 2020, certain Chef Tested and Montgomery Ward branded home products were available through Amazon.com.

See also

References

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Further reading

External links

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