What ended the viability of these stores is probably not what you think.
It’s tempting to blame today’s big-box supermarkets and without a doubt, large-scale stores have had an effect on small businesses, but consider the challenges that came in the 1880s when tin cans and cardboard boxes came on the scene.
Along with other factors, the development of cans and boxes had an enormous impact on the mom-and-pops’ battle to survive against the chain stores.
In “The Great A&P and the Struggle for Small Business in America,” Marc Levinson explains that it was the growth of chain stores in the early 20th century and their use of brand marketing that really did in the smaller businesses.
“Consumers in the 1880s chose items in bulk containers. Vinegar, molasses and laundry
soap was in barrels, slabs of bacon hung on hooks, wheels of cheese were under glass,” he says. People bought by the pint or the pound. From store to store, there were no distinguishing features in the products.
With the development of the box and the can, “it became quite feasible to ship products in small containers and you could put labels on them, and so now it became practical to sell cereal and soap and other products with brand names on them.”
One of the most successful in exploiting the power of brand marketing was The Great Atlantic and Pacific Tea Company, later known simply as A&P.
“The mom-and-pop stores really hated the chains,” Levinson says. “And so did the wholesalers because you had a lot of small wholesalers who served the mom-and pop stores. And many of the chains were what you called self-distributors. They owned their own warehouses and tried to deal directly with the food manufacturers.
“The commercial wholesalers thought they might be driven out of business if the chains prospered, which indeed proved to be the case later.”
Even the federal government was concerned with how big the chains had grown.
By 1940, A&P was the largest U.S. grocery company, so big that during World War II, the company was found guilty in a major antitrust case brought in Danville for selling groceries too cheaply.
Mom and pop simply couldn’t keep up with the buying power and the low prices offered by the likes of A&P.