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How This Failed 1916 Grocery Chain Changed Shopping Forever
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How This Failed 1916 Grocery Chain Changed Shopping Forever

My takeaways from the book, "Clarence Saunders & The Founding of Piggly Wiggly," a story that has striking relevance right now as drugstores like Walgreens face criticism for becoming highly inconvenient places to shop.

In 1916, a grocer named Clarence Saunders faced brutal criticism for a "crazy" idea: letting customers pick their own groceries.

Before Piggly Wiggly, shopping meant waiting while clerks fetched items one by one from behind counters, haggling over prices, and often waiting "10 deep" to be served. The industry insisted this was "convenience."

Saunders had a radical vision: true convenience meant empowering customers.

Here are my takeaways from the book, Clarence Saunders & The Founding of Piggly Wiggly, a story that has striking relevance right now as drugstores like Walgreens face criticism for becoming highly inconvenient places to shop.

It's a fascinating story, and the story the fall of Piggly Wiggly is almost as compelling as it's rise (spoiler: Clarence thought he could out-smart Wall Street and the law). But I'll focus on 3 key themes here that are highly relevant to retail today.

1: Innovation Often Looks "Crazy" At First

Picture a grocery store in 1916. When customers entered, they'd see clerks behind display counters and tables.

They'd hand their shopping list to a clerk, who would go to shelves in the rear of the store to fetch items one at a time, grinding coffee or slicing cheese as needed.

Prices weren't standardized - there might be some haggling involved. The clerk would laboriously add up the total, often on the back of a paper sack. Most stores offered charge accounts and home delivery by horse and cart - considered essential services for any respectable establishment.

Then came Clarence Saunders with an idea that seemed absurd: let customers serve themselves. No clerks, no delivery, no phone orders, no charge accounts. Even the name "Piggly Wiggly" was mocked as suggesting a "carnival house for tots." His competitors ran ads claiming convenience meant providing clerks to pick out and carry groceries for tired customers.

All innovations confront standard behavior when they first launch. Consider Amazon. It was initially hard to convince investors that shoppers would type in their credit card to buy books on the internet. Consider Instacart, and the concept of a third party shopper going and picking your bananas out for you.

It would be vastly misleading to say that all new inventions work out (Clarence Saunders himself had a spectacular failure of innovation at the end of his career, which was just too far ahead of its time), but its important to remember that all innovations looked crazy at first.

2: Economic Forces Are The Mother Of Invention

Saunders launched Piggly Wiggly during World War I, when food prices were soaring. His innovation wasn't just about convenience - it was about fundamentally restructuring retail economics. By eliminating clerks, delivery services, and charge accounts, he slashed operating costs from 15% to 4%.

This efficiency allowed him to stock four times the variety of groceries compared to traditional stores while offering lower prices. His system was so effective that the U.S. Food Administration officially commended Piggly Wiggly for helping ease wartime manpower and price inflation problems.

Today we're seeing similar economic forces at work. As consumers pull back spending, because of a real or perceived threat of recession and price inflation, they look for alternatives. They look to low-cost marketplaces like TEMU and Amazon Haul. Saunders believed that consumers would be willing to pick items themselves off the shelves — something that other grocers were skeptical of. And consumers today are willing to 'roll the dice' on these purchases for the payoff of cheaper prices.

And, just as Saunders found a new business model to combat inflation and labor costs, retailers are turning to retail media networks, with their 70-90% profit margins, to offset thin retail margins and fund digital transformation. The parallel is clear: economic pressure drives innovation in retail business models.

3: The Self-Service Revolution Continues

Saunders didn't just remove clerks - he reimagined the entire shopping experience. He created a standardized store layout that guided customers efficiently through their shopping journey, with clear price tags, organized aisles, and a logical flow. This was the first time customers could discover products on their own terms and even know they were getting the same price as the shopper behind them.

Self service continued its onward march after Piggly Wiggly of course. We’ve have self-service at checkout for years now. So what’s next?

I think we're seeing the next evolution of this self-guided discovery. Amazon's Rufus and Perplexity's Shopping Engine represent a new frontier where AI assists customers in product discovery and decision-making. As I said in a recent Forbes post about Rufus, early experiments show different consumers are seeing different results based on their preferences and behavior.

Just as Piggly Wiggly's self-service model freed customers from relying on clerks' knowledge and recommendations, these AI shopping assistants are creating a new kind of personalized, self-directed shopping experience.

Are we right back where we started from?

Fast forward to this week in 2025. Walgreens CEO just acknowledged that locking up basic items "leads to lower sales" but plans to continue anyway.

In 1917, Saunders' competitors ran ads claiming "convenience means providing clerks to carry groceries for tired customers." They were wrong then, just as retailers are wrong now about how much convenience matters to shoppers. Saunders' Piggly Wiggly patents even included "open and inviting" turnstiles because he understood psychology matters in retail.

For today's retail leaders, the lesson is clear: what seems crazy today might be standard practice tomorrow. The key is recognizing fundamental shifts in consumer behavior and having the courage to build for them, even when others doubt you.

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