Penney, James Cash

views updated May 21 2018

PENNEY, JAMES CASH

James Cash Penney (1875–1971) was born on his father's farm in Hamilton, Missouri, the seventh of 12 children. He grew up in a stern, joyless family. His father, a farmer, served as an unpaid preacher for a fundamentalist sect known as Primitive Baptists. By age eight James Penney was forced to earn money to buy his own clothes. This was his parents' way of teaching him the value of money and self-reliance.

Penney's childhood and early adult life appeared quite ordinary. He finished high school and worked mostly in store clerk positions. Penney moved to Colorado for health reasons and his life changed. He was quickly employed by T.M. Callahan, the owner of the Golden Rule Mercantile Company Chain—a company Penney would later buy-out and make into his own.

Working in the Callahan store, Penney began to dream of operating his own chain of stores, based on the idea of having partner-owners who would share in all the profits. Additionally, he married and found living in a healthier environment stimulated his goals, ambitions, and imagination. In 1902 Penney became owner of his first store, one of the Golden Rule chain stores; he worked night and day for the success of this Kemmerer, Wyoming, store, which opened at 7 am and closed it between 9 and 10 p.m.. Penney worked six days a week and half a day on Sundays.

His work and his sense of constantly expanding business—with more stores and mail-order catalogues— led to monumental national expansion throughout the 1920s. By 1927 J.C. Penney had opened 1000 stores throughout the United States. Penney knew he could not control the daily operations of many stores with such wide expansion. He decided that his success potential could only come true if he delegated responsibility to others and if he put his faith in the people he hired. This faith and his financial arrangements with store managers worked profoundly well. Individual store managers shared in one-third of the store profits. Sharing profits with store managers was, in Penney's own estimation, was the motivating factor for success in business.

Because of this profit-sharing arrangement with his store managers, J.C. Penney was called "the Man with a Thousand Partners," a phrase Penney used in his autobiography. In his book Penney wrote: "The ethical means by which my business associates and I have made money is more important than the fact that we have achieved business success."

In later life Penney, who now had the financial means to do what he pleased, operated cattle farms, became involved with charitable and religious endeavors, and pursued frequent public speaking engagements. His rise to fame and fortune crashed with the stock market crash of 1929—at age 56 he was $7 million in debt. Yet the highly motivated Penney, still vigorous and determined, borrowed money and soon regained control of his retail empire. He wrote in his autobiography that all of his business success was based "in adherence to the Golden Rule, faith in God and the country."

Despite early health problems, J.C. Penney lived to the age of 95. He died in 1971.

See also: Chain Store, Mail-Order House, Retail Industry