glyph 318: business history ... integrity, ethics ... Macy's ... Lazarus Straus ... finance, credit ... "astonished creditors"
Gary Hoover, of Story Stores, Inc., tells of the beginnings of Macy's, "the world's largest store".
The store was built on the reputation of the Straus family. After the Civil War, Lazarus Straus had the integrity to pay his old debts. Gary writes:
... the whole family stayed in Georgia running the dry goods business. Lazarus had bought a lot of merchandise from the NY wholesalers and importers. All of that trade was cut off by the war.
Upon arrival in New York, father Lazarus went seeking everyone he owed money to. Many debts were outstanding but communication had stopped due to the war. Virtually all the creditors had already written off the debts, but Lazarus paid them all back with interest. The creditors were astonished, and the Straus name became as good as gold in New York. After paying out $25,000 on these debts, the family had $6,000 left, with which they started a china and glassware wholesaling business, L. Straus & Sons.
and later, during the depression
They were able to borrow funds at 5% interest, with no collateral, in the depths of a depression, due to the outstanding credit status of their father and the L. Straus company.
This was the bedrock that permitted the creation of what is now (2006) known as "the world's largest store".
Here's the whole story:
Mon, Jul 10, 2006