Store into Institution

In the heart of downtown Detroit stands the block-square, 25-story building that houses J. L. Hudson Co., the second largest* department store in the world. To Detroiters, Hudson's is an institution. One hundred thousand of them shop there every day. But outside the city, the huge store is hardly known. The four brothers who own and run it, all nephews of Founder J. L. Hudson, have a long-standing rule of no publicity, refuse to see the press, and have had only one group picture taken in their lives (see cut). Their publicity director, in fact, is under orders to "have no part of getting names into print." His job is to handle advertising and to tell employees about Hudson's.

Last week Hudson's gave its employees a significant figure for private consumption. In 1952 it reported in a memo to top staffers, the store's total sales hit $152 million, up slightly from 1951; sales in January of this year showed a 4.9% jump over a year ago, v. a rise of only 1.7% for all Detroit retailing. Long famed for conservatism (it always refers to cocktail dresses as "after 5 frocks"), Hudson's is nevertheless moving with the trend towards suburban stores--and its sales should keep rising. Next year, it is opening a $20 million shopping center a mile outside the city limits. Under construction on a 400-acre site, it will have a theater, baby-sitting services, parking space for 6,000 cars and--just to keep Hudson's on its toes--more than 70 other stores, all selling competing merchandise.

Money Back. The store was founded by Joseph Lothian Hudson* in 1881 in a corner of the old Detroit Opera House. At first, it sold only men's and boys' clothing, but soon moved into larger quarters and expanded its line to almost everything except autos. When J.L., a bachelor, died in 1912, he left the business to his nephews, the Webber boys--Richard H. (now chairman), Oscar (president), James B. and Joseph L. (both merchandising directors).

Building on retailing's oldest precept, that the customer is always right, the Webbers established a host of services, including one of the most liberal refund systems in the world. If a Hudson's customer decides he doesn't like something he has bought, all he has to do is pick up the phone and say so; one of Hudson's 300 delivery trucks will come and take the merchandise back. Hudson's has been known to credit merchandise bought ten years before and never used. Last year, Hudson's actually sold more than $175 million in goods; with no fuss, it took back $25 million worth.

Educated Customers. The Webbers are always looking for new ways to educate customers to new needs--which Hudson's can supply. A staff of 48 interior decorators helps shoppers pick furnishings and (for a modest fee) makes home calls to advise on such things as wallpaper and floor plans for furniture. To lure shoppers off the ground floor, the Webbers spotted four restaurants through the store, where 8,900 customers are served daily.

Unlike most retailers, the Webbers lease out few departments (e.g., beauty and optical shops), thus can keep close tabs on quality throughout the store. To keep track of quantity, they get detailed figures on each day's operations by 9 the next morning, can instantly spot when any department shows signs of slipping. Its basement store, which racked up $35 million in sales last year, does not sell just slow movers and castoffs from upstairs; it has its own staff of buyers and merchandisers. Says Merchandising Director James Webber: "The basement store is the upstairs store's toughest competition."

Hudson's is as much an institution to its 11,500 employees as to its customers. When an employee takes sick, he collects full salary indefinitely; anyone who has worked at Hudson's for five years or more can be fired only with the O.K. of the president.

In turn, Hudson's expects its staff to remain true to the "Hudson Creed," which hangs framed in the executive offices and which is handed out to every new employee: "I believe in Hudson's because I am putting into it myself . . . My faith is . . . in the ideals of men, those who are responsible for this great house of industry . . . I stand inspired . . ."

*By floor space. Hudson's has 2,124,316 sq. ft. First is Manhattan's R. H. Macy & Co., with 2,150,000 sq. ft. and whose sales, including 20 branches and subsidiaries, were $332 million for the fiscal year ending Aug, 2, 1952.

*Whose sister, Mrs. William Clay, was the mother of Mrs. Edsel Ford.

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