In Celebration of J. C. Penney-The Master of the Golden Rule
By Liesl Greathouse
MONTROSE–You may not know it, but Montrose has had a JC Penney for 100 years. The first JC Penney store in Montrose was a small dry goods business established in 1912 in the old Hodges building on the corner of Main and Townsend (which burned down in 1986 and is now Demoret Park). In fact, it was the first JC Penney store in western Colorado.
When Penney’s first opened, the city did not have pennies in circulation. J. C. Penney himself threatened to shut down his store if the city did not get the penny. The women of the town worked together to convince the town council to get the penny into Montrose’s money circulation, thus keeping the JC Penney store open and the 21st nationwide.
However, according to Sally Johnson, an employee at the Montrose County Historical Museum, “J.C. Penney himself was not in Montrose long enough to make a large impact on the town.” Nevertheless, he did make a large impact on the history of business.
Who was J. C. Penney? Born September 16, 1875, in Hamilton, MO, James Cash Penney was the seventh of twelve children, only six of whom lived to adulthood. His father was a Baptist preacher and farmer whose strict discipline included making his son pay for his own clothing once he reached his late pre-teens. After graduating from high school, Penney had planned on attending college with the hopes of becoming a lawyer. However, his father’s death forced him to take a job as a store clerk to help support his family. Penney once said about his early years, “I would never have amounted to anything were it not for adversity.”
In 1898, Penney began working for the Golden Rule stores, a small chain in the western United States. In 1902, the owners, Guy Johnson and Thomas Callahan, were so impressed by his work ethic and salesmanship that they offered him a one‐third partnership in a new store he would open.
Penney described his business perspective back then as, “In setting up a business under the name and meaning of the Golden Rule, I was publicly binding myself, in my business relations, to a principle which had been a real and intimate part of my family upbringing. Our idea was to make money and build business through serving the community with fair dealing and honest value.”
He participated in opening two more stores, and when Callahan and Johnson dissolved their partnership in 1907, he purchased full interest in all three stores.
By 1912, Penney had grown the business to 34 stores in the Rocky Mountain States. In 1913, the company was incorporated under the new name, J. C. Penney Company. During the 1920s, the Penney’s expanded nationwide, with 120 stores in 1920. By 1924, Penney reported an income of more than $1 million annually. The large income allowed Penney to be heavily involved in many philanthropic causes during the 1920s. After the 1929 stock crash, Penney lost virtually all his personal wealth and borrowed against his life insurance policies to help the company meet its payroll.
Even after relinquishing daily operating management of the company in the early 1940s, Penney continued his active involvement in managing the company and its stores. He remained as chairman of the board until 1946, and, after that, as honorary chairman, until his death in 1971 at the age of 95.
What made Penney a success? In all of his business dealings, J. C. Penney held strong ethics. He believed that businesses should be based on the Golden Rule, “Do unto others as you would have them do unto you.” That Rule penetrated every aspect of his business principles, Penney once explained, “The Golden Rule finds no limit of application in business.”
One business practice derived from the Golden Rule was valuing hard work in his employees. He is often quoted as saying, “Give me a stock clerk with a goal and I’ll give you a man who will make history. Give me a man with no goals and I’ll give you a stock clerk.”
He encouraged his employees to learn and grow in order to move up in the business ranks. He explained that he and his company, “Do not primarily train men to work. [We] train them to serve willingly and intelligently.”
Another principle that Penney always practiced was to treat customers well. He said, “The public is not greatly interested in saving a little money on a purchase at the expense of service.”
Penney knew that keeping a high standard of service would help keep his business thriving. He once explained, “Courteous treatment will make a customer a walking advertisement.”
Penney also believed in helping others through his business, himself donating much of his income to charities. He explained, “We told store managers that, unless they knew their communities and unless they were prepared to enter sympathetically into community life, they could not make a success of their stores.”
In that same mind set, Penney also offered this advice, “A merchant who approaches business with the idea of serving the public well has nothing to fear from the competition.”
While we may have recently celebrated the 137th anniversary of J. C. Penney’s birth, his business principles still live on today.
From having a high standard in service to his customers, to placing a high value on his employees, businesses today might consider applying his principles to everyday transactions.