Nordstrom: Shoe store establishes a foothold for retail dynasty

By SUSAN PHINNEY
SEATTLE POST-INTELLIGENCER REPORTER

While many a downtown Seattle retailer has come and gone, Nordstrom has settled in and grown -- quietly, sturdily, powerfully -- for almost 100 years.

After setting down tenuous roots, it has matured into a national specialty chain with a huge word-of-mouth reputation.

But back in 1901, back at the beginning, it was just a tiny shoe store named Wallin & Nordstrom.

John W. Nordstrom, great-grandfather of today's co-presidents, immigrated from Sweden in 1887, when he was only 16.

In 1950 he published a small book, "The Immigrant in 1887," detailing his arrival in New York, his first job in a Michigan iron mine, and his eventual migration to the West Coast. He meant the book as a family history for his descendants, but it has become a valuable early history of the Seattle-based company that bears his name.

Nordstrom was working in the Puget Sound timber industry as a logger and sawmill hand when he read in the Post-Intelligencer that gold had been found in Alaska. Like thousands of others in 1897, he headed north.

He didn't strike it rich, but he returned with about $13,000 -- money from selling his claim. (It turned out to be a very valuable claim, but that's another story.)

In Seattle, Nordstrom attended business school, spent $2,500 building two rental houses on Capitol Hill and decided to join his friend, Carl Wallin, in the shoe business.

Wallin had a small shoe-repair shop with 10 feet of frontage on Pike Street. The new partners added another 10 feet of storefront and opened with $3,500 in shoe stock.

Today there's often a crowd of eager shoppers waiting when a Nordstrom store opens its doors. And the first day of a semi-annual or anniversary sale can be a mob scene.

But in 1901, business was slow.

It took several months before Wallin & Nordstrom grossed $100 on some Saturdays. But within a few years, the partners bought out a competitor on Second Avenue and moved to that location.

Wallin sold out to Nordstrom in 1929, and the rest is retail history.

Nordstrom had married another Swedish immigrant, Hilda Carlson, in 1900 and they had five children, two girls and three boys.

At about the time Wallin was ready to sell, the Nordstroms' sons -- Elmer, Everett and Lloyd -- were ready to join the business. According to John Nordstrom's memoir, he sold the company to his sons a year later, in 1930.

That trio built it into a shoe chain, with eight Nordstrom stores in Washington and Oregon, and leased shoe departments in other stores in those two states and California.

In the 1960s they bought Best Apparel in Seattle and the Nicholas Ungar apparel store in Portland and turned Nordstrom into a full-line specialty fashion retailer.

Expansion continued when the third-generation management team -- John, Jim and Bruce Nordstrom, son-in-law Jack McMillan and family friend Bob Bender -- took over the helm in 1968.

A corporate culture evolved, one that emphasized customer service and empowered salespeople to "do the right thing." Today new recruits are told they'll never be criticized for doing too much for a customer, only too little.

In "The Nordstrom Way" by Robert Spector and Patrick D. McCarthy (John Wiley & Sons, 244 pages, $24.95), Bruce Nordstrom said he was proud of the way the company had sustained and enlarged its corporate culture, improving both service and the store's reputation in the past 40 years.

Expansion has not come without growing pains. In recent years there have been lawsuits charging bias and discrimination.

Nordstrom also was sued by a union for failing to pay workers for "off-the-clock activities -- delivering merchandise, writing thank-you notes and attending meetings during off-work hours. The suit was settled with Nordstrom agreeing to pay back wages to present and former employees.

A Place Two division featuring boutiquelike stores in Bremerton, Bellingham, Federal Way and other areas, was phased out after 19 years so management could focus on the large regional stores throughout the country.

Today the fourth generation -- sons of John, Jim and Bruce -- are co-presidents.

Six Nordstroms -- Bill, Blake, Dan, Erik, Jim and Pete -- work with chairman and chief executive officer John Whitacre, leading what has become a fashion retailer with 96 stores in 22 states and gross sales of $4.9 billion last year.

And the Nordstrom reputation for customer service has become a retail legend -- one that retailers, especially those who share markets with Nordstrom, find they must emulate to compete.