Gimbel Moves Up

Three years ago this month four of Adam Gimbel’s descendants journeyed to the mellow, elm-shaded town of Vincennes, Ind. (pop. 18,228). There they commemorated the 100th anniversary of the opening of Peddler Adam’s wondrous “Palace of Trade,” with the prediction: “The best 100 years lie ahead.” Last week the Gimbel mercantile dynasty proudly ended its best year. The gross for 1944 was estimated at an alltime high of upwards of $190 million. Result: Gimbel’s, in fourth place in 1942, is now the leading metropolitan department store chain.*

Parachutes and Stockings. Primemover behind this rise that carried the eleven-store Gimbel chain ahead of arch-rival R. H. Macy & Co. as well as Federated Department Stores and May Department Stores, is greying Bernard Feustman Gimbel, 59, robust, genial patriarch of the Gimbel clan. He had a hunch that the war would boom retail sales. So he turned his buyers loose with instructions to order all they could of consumer goods which would be among the first casualties of war.

The buyers bought more vacuum cleaners, radios, etc. than Gimbel warehouses could hold. Bernard simply rented more warehouse space, kept his buyers hunting for more goods. One lucky find just before Christmas 1943: 400-odd electric train sets. Thus, when the stocks of competitors were running out, Gimbel stores were boldly advertising sales of scarce goods. Many a new customer was thus lured into a Gimbel store. Example: the chain’s $3½-million-inventory of nylon and silk stockings lasted well into 1943, an irresistible lure for women who buy an estimated 85% of all retail merchandise sold.

When “prewar” goods in wholesale markets gave way to strange and often inferior substitutes, buyers shied competitors away from the new goods: but Gimbel sent his buyers out to place whopping orders. Bernard Gimbel was playing another hunch based on a sound merchandising theory: so long as people had plenty of money to spend they might not be too choosy about what they could buy. Also he kept a sharp eye out for Army & Navy surpluses, figured out civilian uses for them. When a Gimbel buyer heard of a stock of 100,000 Army-rejected small parachutes used to drop flares, he grabbed them from the manufacturer. Gimbel’s sold all of them. Another buyer nabbed 750 surplus Signal Corps field telephones. They went like hot cakes at $29.95 ea. Civilians used them as intercommunication systems in offices and homes.

Stocks & Profits. The job of keeping Gimbel on top poses a knotty problem. Many a merchant fears that he might be caught with huge supplies of substitute goods, if the war should end suddenly, have to take huge losses to sell them. But

Bernard Gimbel is playing another hunch. He intends to try to keep Gimbel inventories at their normal three-months stock. His hunch: prewar standards in merchandise will return so slowly that he will have plenty of time to unload his substitute goods at no great loss.

*Allied Stores (mainly a holding company) still has a larger gross from its small department stores and small-town chains. Gimbel’s’, solely an operating company, is only in bigger cities, as Manhattan, Philadelphia, Pittsburgh and Milwaukee. Gimbel-owned Saks stores are in Manhattan (two stores), Beverly Hills, Chicago, Detroit, Miami Beach and Palm Peach.There has been no Gimbel-owned store in Vincennes since 1888.