The Great A&P and the Struggle for Small Business in America

The Great A&P and the Struggle for Small Business in America

[This is the MP3CD audiobook format.]

The amazing story of the rise and fall of the Great A&P, the world’s largest retailer.

From modest beginnings as a tea shop in New York, the Great Atlantic & Pacific Tea Company became the largest retailer in the world. It was a juggernaut, the first retailer to sell billion in goods, the owner of nearly sixteen thousand stores and dozens of factories and warehouses. But its explosive growth made it a mortal threat to hundreds of thousands of mom-and-pop grocery stores. Main Street fought back tooth and nail, enlisting the state and federal governments to stop price discounting, tax chain stores, and require manufacturers to sell to mom and pop at the same prices granted to giant retailers. In a remarkable court case, the federal government pressed criminal charges against the Great A&P for selling food too cheaply–and won.

The Great A&P and the Struggle for Small Business in America is the story of a stunningly successful company that forever changed how Americans shop and what Americans eat. It is a brilliant business history, the story of how George and John Hartford took over their father’s business and reshaped it again and again, turning it into a vertically integrated behemoth that paved the way for every big-box retailer to come. George demanded a rock-solid balance sheet; John was the marketer-entrepreneur who led A&P through seven decades of rapid changes. Together, they built the modern consumer economy by turning the archaic retail industry into a highly efficient system for distributing food at low cost.

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3 thoughts on “The Great A&P and the Struggle for Small Business in America”

  1. 3 of 3 people found the following review helpful
    4.0 out of 5 stars
    The conflict between competition and capitalism., February 9, 2012
    By 
    Paul Tognetti (Cranston, RI USA) –

    Verified Purchase(What’s this?)
    These days Walmart proudly touts itself as the “world’s largest retailer”. The company boasts more than 8500 stores in 15 countries under 55 different names. Most people seem to have strong feelings about Walmart and the way they do business. You either love them or hate them and for many there is simply no middle ground. Unbeknownst to me another great American retailer evoked the very same passions in people and set off similar debates about competition and the merits of capitalism back in the 1920’s, 1930’s and 1940’s. The Great Atlantic and Pacific Tea Co. was founded in New York City by George Gilman in 1859. It began life as a small chain of tea and coffee stores and would eventually evolve into a retailing behemoth. Author Marc Levinson has chronicled the impressive history of the company that would one day become A&P in his new book “The Great A&P and the Struggle for Small Business in America”. This is an important addition to the literature on retailing in the United States and my guess is that the book will be used as a case study for business students at colleges and universities for decades to come.

    In “The Great A&P” Levinson describes in intimate detail the incredible story of how this relatively small concern managed to reinvent itself time and again and ultimately become the largest food retailer in the United States. For more than half a century A&P was guided by John and George Hartford after their father acquired the company in 1878. Both John and George proved to be gifted businessmen with innate abilities and instincts that would serve A&P well for many decades. Much of the success of A&P can be attributed to the “high volume–low price” stategy embraced by the Hartford brothers back in the 1920’s. John and George kept their company privately-held and as a result did not have to answer to a board of directors. The Hartford’s were firm believers in no-holds-barred competition and were the first to figure out many of the efficiencies that would allow them to rapidly expand the company. In 1912 A&P decided to embark on a new strategy of what they dubbed “economy stores”. This “no-frills” approach to retailing was am immediate success and by the middle of the decade A&P boasted more than 1600 stores. Furthermore, the Hartford’s quickly figured out that by being the largest, most successful food retailer in America they should be able to extract concessions from jobbers and wholesalers or even bypass them altogether. This would allow A&P to slash their prices even more and give the company an even greater advantage in the marketplace. And unlike other chain stores that were emerging during this period A&P chose to rent their locations rather than build the stores themselves. John and George believed that this gave the company greater flexibility to respond to ever changing market conditions. Whatever they were doing it was working like a charm. A&P would continue to experience exponential growth over the next two decades.

    But there was trouble on the horizon. The success of A&P and other chain stores posed a serious threat to tens of thousands of family-owned “mom and pop” grocery stores and to the thousands of locally-owned wholesalers and jobbers who supplied them. There was a growing undercurrent among a certain segment of the population and a growing number of opportunistic politicians to rein in the chains. The movement found a champion in Congressman Wright Patton (D-TX). Elected to Congress in 1928, Patton was a populist who believed that the explosive growth of chain stores was doing irreparable harm to family-owned businesses and local economies. Patton proposed a whole host of new taxes and regulations that would effectively squelch the growth of chain stores and most especially A&P. Furthermore, in 1936 Congress passed the landmark Robinson-Patman Act which prohibited anticompetitive practices by producers, specifically price discrimination. These developments would seriously hinder A&P in some ways but despite it all the company bobbed and weaved and changed and adjusted and continued to grow for another decade. Although there were always pockets of resistance to the growth of the chains the vast majority of Americans seemed to embrace the concept.

    As I indicated earlier “”The Great A&P and the Struggle for Small Business in America” is a terrific case study and should be required reading for all serious business students. We hear the very same arguments today regarding the way Walmart conducts its business. But there are some very clear differences between the two companies which should become quite apparent to you as you read this book. Although I found the writing to be a bit tedious at times I believe this is a book that is well worth your time and attention. Recommended.

  2. 1 of 1 people found the following review helpful
    5.0 out of 5 stars
    My old stomping grounds, the Great Atlantic and Pacific Tea Co., April 1, 2015
    By 
    iluvlv (Las Vegas, NV) –

    Verified Purchase(What’s this?)
    As a former A&P store manager I have always been interested in the history of the Company and was very excited to find this book. Setting some of the early history straight did not diminish my respect for the Hartford’s, only reinforced it. To take a tiny company in NYC and turn it into a 15000 store powerhouse was no small feat. The constant interference from local, state and federal government along with independent special interest groups had to be extremely trying for the brothers to take while still trying to run a business with the goal of selling the most product to the consumer at the lowest possible price. To imagine that the government would force a business to artificially raise prices and restrict it’s access to products in the most efficient way is just another example of government meddling where it shouldn’t be. Had A&P not fought hard to be successful it would have taken a lot longer for the cost of food as a percentage of people’s income to drop to a reasonable level. It is very sad how such a successful company could fall so fast to the shell it is today. Not having the proper visionaries to carry on was probably the Hartford’s greatest failing.Some may find some of the facts and figures a little dry but to anyone who has a history in food retailing or any chain store business will find this an interesting read.
  3. 4.0 out of 5 stars
    Long before the outcry against WalMart and all its’ supposed …, February 26, 2016
    By 
    Fred (Gastonia, NC USA) –

    Verified Purchase(What’s this?)
    Long before the outcry against WalMart and all its’ supposed ills, there was the A&P grocery chain. Though the exact circumstances are different, the main thrust is the same. In both cases, small(er) independent locally owned grocery stores were undercut and overwhelmed by a larger and more focussed competitor.

    You didn’t know the importance of small grocery stores and their contribution to prosperity in America from 1770 to 1960? Of course you didn’t! You never can know what you don’t know. Yes! Read and learn, children, read and learn.

    “The more things change, the more they stay the same.”

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