Kresge's Ten Billion Dimes

Employees at S. S. Kresge Co. say that their founder has always "looked at money as a tool," and there is no doubt that Sebastian Spering Kresge has used dimes as crowbars. When he was in formed years ago that his variety-store chain had reached sales of $10 million, he noted that the sum was "100 million dimes." Closely watching the pennies as well, Kresge insisted that he "never spent more than 300 for lunch in my life," and admitted giving up golf out of fear of losing too many golf balls. For all his personal frugality, Kresge has often been willing to spend millions on his company, helped to weld it into the nation's second largest variety-store chain, whose stores, now 918 in number, had sales last year of $851 million.

Last week, troubled by failing eyesight, S. S. Kresge at 98 retired as chairman of the company he has nurtured for 69 years. Turning to younger blood, Kresge directors gave the chairmanship to S. S.'s son, Stanley, 66, who last year had to relinquish his vice-presidency upon reaching the firm's mandatory retirement age for operating personnel. The company's day-to-day operations will continue to be under control of $163,400-a-year President Harry B. Cunningham, 58.

No Puffs for Pastors. Born on a Penn sylvania farm, S. S. Kresge started as a salesman of pots and pans, became fascinated by the way his friends Frank Woolworth and John McCrory were overturning the old cracker-barrel retail concepts with their low-price, high-volume retail stores. In 1897, he gambled his $8,000 savings on a similar shop in Memphis. On the way up, Kresge pioneered in giving his employees sick pay and paid vacations, in 1925 was the first to discard the strict nickel-and-dime rule, began offering goods from 250 to $1 as well.

The company owes much of its unique character--as well as its profits--to Kresge's farm-bred frugality and his stern Methodist morality. He once donated $500,000 to the Anti-Saloon League, said that "I never gave a dime to any church the pastor of which uses tobacco." Kresge men and women, mindful of old S. S. dictums, still eat separately in company cafeterias, habitually snap off lights when leaving washrooms--although managers complain that switches are wearing out. Yet when President Cunningham in 1961 urged that the chain fight discounters by opening its own discount "K-Marts," at a cost of $80 million, S. S. gave his approval without blinking a blue eye. The success of those stores is one rea son why the company's profits last year rose from $17 million to $22 million despite prodigious start-up expenses. It is growing faster than either Woolworth or third-ranking W. T. Grant, expects to increase its sales this year to $1 billion--or ten billion dimes.

No Profits from Speeches. Kresge and Son Stanley own $4,000,000 worth of the company's stock. The founder long ago had donated almost all his holdings to the $175 million Kresge Foundation. Now headed by Stanley, it supports Detroit civic organizations and the Salvation Army as well as higher education and hospitals all over the world. Dedicating Kresge Hall at Harvard Business School when he was 85, S. S. gave one of the tautest ribbon-cutting speeches on record. He simply said: "I never made a dime talking." Then, as he did last week, one of the last of the dime-store magnates gracefully stepped down.

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