The Collapse and Fall of Montgomery Ward

The Collapse and Fall of Montgomery Ward

Montgomery Ward was once one of America's leading retail store's and chains. The founder of Montgomery Ward, Aaron Montgomery Ward was the first in history to come out with the first dry-goods mail-order catalogue, witch listed 163 items. What happen to this company and its great ideas? With this paper I intend to help you realize how important it is to communicate within a business. This business probably would have been more successful and reached higher greatness if they had greater communication with the public.

A little background information. Montgomery Award was founded in 1872, and had its first free standing retail store in 1926 in Plymouth, Indiana. Montgomery Ward did not face any king of problems when it was first introduced, it succeeded in everything it did. The mail-order catalogue was great and doing well. By 1883 the company had a 240 page catalog with lists of 10,000 items all together. This is how the company got big and famous. By 1875 the company was doing so well so they come out with the catch phrase "Satisfaction Guaranteed or Your Money Back." In 1928 Mr. Ward opened 244 stores nation wide, and by 1929 he had over 531 stores. In1968 Montgomery Ward had major merges with Container Corporation of America and Mobile Oil corp. In 1988 they stray away from the mail-order business and concentrate on a specialty store strategies. In 1988 management undertakes successful 3.8 billion dollar buyout, making Montgomery Ward a privately held company, and in 1991 they resume the mail-order catalog business. Then in 1997 Montgomery Ward files ch11 bankruptcy. They eliminated 450 national office jobs, 250 stores, and 10 distribution centers in 30 states.

The major problem that Montgomery Ward fell victim to was an increasingly competitive retail environment, and a fast-paced world where aggressive discounters are forcing old-line operators to change radically or become ancient history. They just could not keep up. The communication was all wrong near the end, they were not able to give what the customers and the buying public what they wanted, a good quality product with low fair price. Even though they were making money it just wasn't enough. In 1900 they recorded 8.7 million in sales but fell behind Sears and Roebuck which generated 10 million in sales. Another great reason why Montgomery Ward fell