Nordstrom stores are known for outstanding customer service and product selection. The Seattle-based department store began as a small shoe store co-founded by Swedish immigrant John W.Nordstrom (1871-1963) in 1901.
John W. Nordstrom endured many hardships before becoming a successful shoe retailer in the early 20th century. A difficult childhood, immigration to the United States, and a series of back-breaking jobs gave Nordstrom the drive he needed to succeed and taught him the value of hard work.
The founder of Nordstrom stores was born Johan W. Nordstrom on February 15, 1871, in Alvik Neder Lulea, Sweden, just 60 miles from the Arctic Circle. Nordstrom's father, a blacksmith, wagon maker, and part-time farmer, died when Nordstrom was eight. Three years later, Nordstrom's mother took him out of school to work on the family farm. Nordstrom, the third of five children, described his childhood as unhappy. His mother expected him to do as much work as his brother, who was ten years older.
Nordstrom left Sweden with two friends when he was 16. They traveled by boat to Hull, England, and then by train to Liverpool, where they began a ten-day voyage as steerage passengers to New York. From there, Nordstrom took a train to Stambaugh, Michigan, where a cousin helped him get a job loading iron ore onto railroad cars. This was the first of many manual jobs he held over the next five years. Nordstrom moved westward through Iowa, Colorado, California, and Washington, performing such back-breaking work as logging, coal mining, gold and silver mining, loading railroad ties, and carting bricks. In 1896, he settled in Arlington, Washington, about 50 miles north of Seattle. Nordstrom was one of many Swedish immigrants in the town. He started a potato farm on 50 acres of land and began courting a Swedish woman named Hilda Carlson.
A year later, the Seattle Port-Intelligencer reported that gold had been found in the Yukon territory. Like many West Coast residents, Nordstrom traveled north to seek his fortune. He took a coal freighter to Port Valdez, Alaska, and then traveled 1,000 miles on horse and on foot to Dawson in the heart of the gold fields. Accustomed to hard work, Nordstrom toiled in the gold fields for two years before striking pay dirt. When another miner challenged his claim, Nordstrom sold his share to the other miner rather than fight him in a corrupt arbitration process. He returned to Seattle with $13,000.
Settled in Seattle
Nordstrom, who had changed his given name to John, married Hilda Carlson in 1900. The couple had five children: Everett, Elmer, Lloyd, Mabel, and Esther.
Nordstrom wanted to invest his earnings in a business. A Klondike friend, Carl F. Wallin, worked as a shoemaker and suggested that he and Nordstrom open a shoe store. Nordstrom invested $5,000 in the business; Wallin added $1,000. Their store, Wallin & Nordstrom, opened in 1901 in a 20-foot-wide Seattle storefront. The two Swedes, who barely spoke English, began their business with a $3,500 inventory of shoes, ranging in price from $1.95 to $4.95. Nordstrom knew nothing about selling shoes, as he recalled in his memoir, "Opening day, we had not had a customer by noon, so my partner went to lunch. He had not been gone but a few minutes when our first customer, a woman, came in for a pair of shoes she had seen in the window. I was nervous and could not find the style she had picked out in our stock. I was just about ready to give up when I decided to try on the pair from the window, the only pair we had of that style." The customer bought the shoes.
The partners relied on traveling salesmen to stock the store. At first, they bought only medium widths. But they soon realized that their Swedish customers required larger sizes, and they began keeping wider widths in stock. Little did they know at the time, the successor to their tiny store would one day have a national reputation for its extensive inventory.
Wallin & Nordstrom's first day sales totaled $12.50. Within a few months, Saturday sales reached $100. By 1905, the store's annual sales were $47,000. That year, the partners expanded for the first time. They bought a second shoe store and relocated their business. The business expanded several times, but it continued to carry conservative shoes, including many corrective "health" shoes, rather than fashion styles.
Nordstrom's sons, Everett and Elmer, began working in the store as stock boys when they were young. By 1928, Nordstrom and Wallin's partnership was strained and Nordstrom sold his interest in the store to his sons. The Nordstrom Way describes the sons' ownership as "only on paper because their father had loaned them the money for the purchase and had co-signed a bank note to ensure them working capital." Although officially retired at age 57, John Nordstrom maintained an office at the store for the rest of his life. Wallin retired in 1929 and sold his share of the business to the Nordstrom sons, who renamed the store Nordstrom's. John Nordstrom's third son, Lloyd, joined the company in 1933.
Many years later, John Nordstrom was asked if he had taken a big risk when he turned his business over to his relatively inexperienced sons. He responded, "I only went through the sixth grade in grammar school in Sweden. My boys are college graduates. They must be a lot smarter than I ever was."
Nordstrom's survived the Depression, when retail prices dropped, forcing the business to sell twice as many shoes to maintain its sales volume. During World War II, shoes were strictly rationed. Because leather was reserved for Army boots, retailers were given quotas of shoes to sell and customers were issued ration stamps. They were allowed only three pairs per year. The Nordstroms traveled the country to maintain the inventory their customers were accustomed to, including odd sizes and women's work boots, which were in demand during the war.
Between the 1920s and the 1950s, Nordstrom developed the customer service philosophy for which the store is known today. Everett, Elmer, and Lloyd Nordstrom ran their business with a high level of personal service. According to The Nordstrom Way, they stocked high-quality merchandise and worked with suppliers to obtain the best values, unique items and a wide selection of styles and prices. Buyers were sticklers for quality and were known to examine merchandise scrupulously. Salespeople were taught to understand the products they sold.
Ironically, the company's customer service attitude could not change the owners' salesmanship abilities. In The Nordstrom Way, Lloyd Nordstrom said that he, his brothers, and his father were the store's worst salesmen, but they succeeded by providing good value and quality, and by hiring salespeople to move the merchandise out of the store. Today, everyone who works for Nordstrom's begins his or her career as a salesperson; managers are not hired from outside the company. Management believes the only way to learn how to care for customers is to grow up inside the company culture.
Under the management of Nordstrom's three sons, his business grew to be the largest independent shoe chain in the United States. By the early 1960s, the company had expanded to eight stores in Washington and Oregon and operated 13 leased shoe departments in other stores. Nordstrom's four-story Seattle store was the largest shoe store in the United States. The company's 1961 sales volume reached $12 million.
Expanded into Apparel
Nordstrom's diversified into apparel when it bought Best's Apparel Inc., a fashionable Seattle women's clothing store in 1961. Six years later, annual sales were $40 million. Shoes accounted for half of sales.
During the 1960s, Nordstrom's became the first clothing retailer to pay its salespeople meaningful commissions. The Nordstrom family believed that cash incentives encouraged salespeople to work harder and to build customer loyalty.
Shortly after the purchase of Best's, on October 11, 1963, John Nordstrom died in Seattle, Washington of a cerebral hemorrhage, at the age of 92. He had visited his office at the company headquarters throughout his retirement to play cards or cribbage or just to walk around the store.
In 1968, Nordstrom's sons turned the business over to their sons. A plan was considered to sell the business to another retailer. Instead, the third generation took the company public in 1971. Nordstrom Inc. subsequently expanded into Alaska, California, and the East Coast. This expansion was considered risky because Nordstrom was not well known outside the Pacific Northwest. In 1995, six members of the fourth generation of Nordstrom's were named co-presidents of what had become a nationwide chain.
Today, the small shoe store founded by hard-working John Nordstrom in 1901 has grown into a nationwide fashion specialty chain known for its renowned services, generous size ranges, and a selection of fine apparel, shoes, and accessories for men, women, and children. Nordstrom has been called "America's Number One Customer Service Company" based on its policies of empowering salespeople to make decisions favoring the customer over the company. While the company's growth and expansion were largely orchestrated by the descendents of John W. Nordstrom, he founded the company on the principles that have fueled its success: exceptional quality, selection, service and value.
Further Reading on John Nordstrom
Spector, Robert and Patrick D. McCarthy, The Nordstrom Way, John Wiley, 1995.
Footwear News, November 25, 1991.
Nordstrom Inc. Annual Report, 1987.
Seattle Post-Intelligencer, October 12, 1963.
"Nordstrom History," available at http://www.nordstrom.com(March 1, 1999).