Rural Missouri Magazine

Hamilton's favorite son
James Cash Penney built a retail empire across the nation,
but his heart was always at home in Hamilton

by Bob McEowen

In a J.C. Penney publicity photo, Penney fits shoes to young customers. Many of the company’s children’s shoes were made in Hamilton. Photo courtesy of the JCPenney Company records, DeGolyer Library, Southern Methodist University.

With more than 1,000 locations nationwide, it’s a rare American who has not stepped inside a J.C. Penney store. There was a time when James Cash Penney was nearly as well known as the company that bears his name. His photograph was displayed in every store. His writings appeared in religious publications. He was a mentor to thousands of entrepreneurs and pioneered progressive business practices based on profit sharing and employee ownership.

As a gentleman farmer, his land and livestock were the envy of the nation. A philanthropist, he shared his vast wealth across America and contributed to worthy causes in his hometown and state.

More than 35 years after his death in 1971, the memory of Penney is all but lost outside the halls of the company’s corporate offices and in his boyhood home of Hamilton, Mo.

“How many towns have somebody who started a nationwide thing? How many companies have run over a hundred years?” asks Dean Hales, a Hamilton businessman who knew Penney and helped create a museum in his honor. “There’s only one J.C. Penney and he was born here.”

Penney was born in Hamilton on Sept. 16, 1875, but he made his name and fortune elsewhere. He worked two years in a local dry goods store before heading west, at the age of 21, in search of opportunity and weather more suitable to his health. He would return, nearly 30 years later, to open his 500th store, in the exact location where he got his start in retailing.

J.C. Penney visits with Hamilton residents Mrs. Rubin K. Hartley, store manager Morris Pettengill and Mrs. M.E. Overstreet during a 1960s return to his hometown. Photo courtesy of the collection of E. Tom Strade, Tom Strade Photography, Hamilton and Bethany, Mo.

Author John Monk Saunders described the return of “the merchant prince” in the October 1924 edition of The American Magazine.

“The shoe clerk sat down astraddle his little bench and fitted a shoe to the farmer’s right foot, lacing up the tops and smoothing the leather over the instep with eager concern,” Saunders wrote in his profile of Penney, “The Man with a Thousand Partners.”

“The farmer did not know that the slender clerk before him was one of the great figures in American merchandising . . . that his name was known coast to coast; that his life was insured for three million dollars; that thousands of loyal, ambitious men had cast their lots with his, that they, and their families, might attain what he had attained.”

The article’s picture of Penney captures just one moment in an illustrious career. In the decades that followed, Penney made and lost tens of millions of dollars, only to make it back again. He married three times, buried two wives and fathered five children. He lived to an age of 96 and reported to work almost every day until his death.

A child of Hamilton

Much of what Penney became can be traced to his humble beginnings in Hamilton — and, in particular, lessons learned from his father.

James Penney Sr. was a minister in the strict Primitive Baptist sect, but was accused of heresy for advocating salaries for pastors. Active in politics, the elder Penney unsuccessfully ran for a seat in the state legislature and later Congress on The People’s Party ticket. Despite prominence in the community, the Penney family eked out a living from a 390-acre farm, located 2 miles east of Hamilton.

When he was just 8, Penney was given responsibility for buying his own shoes and clothes with money he raised himself. “Right then and there I began to learn what 20 years as an unpaid minister had taught my father — what money means,” Penney wrote in an early autobiography, also called “The Man with a Thousand Partners.”

Penney’s father kept a close watch on his son’s efforts to raise money by selling pigs and later watermelons. When young Jim set up shop outside the county fair — without paying the exhibitor’s fee — his father sent him home in shame. Unbeknownst to Penney, the one-time pastor was teaching his son that, even in business, The Golden Rule applies — one must treat another as he himself would like to be treated.

Hamilton businessman Dean Hales knew J.C. Penney and spearheaded the creation of the J.C. Penney Museum, which includes a life-size representation of the man.

“The lesson soaked in,” Penney wrote. “It became the guide of a lifetime. Father knew the importance of money, but he also knew and practiced the Rule that is the most solid asset of civilized man.”

Before his death, the elder Penney secured a job for his 19-year-old son at a local dry goods store. The Hamiltonian made mention of the development in its Feb. 15, 1895, edition: “J.C. Penney, Jr. will be found in J.M. Hale & Bro.’s store where he is learning the business. Jim is a good boy and we believe he will succeed.”

The Golden Rule

Three years later, Penney was in Colorado, working at a dry goods store, coincidently called the Golden Rule. The store’s owner, a fellow Missouri transplant named Tom Callahan, hired Penney as a temporary replacement for a sick clerk. Penney proved his worth by staying later, working harder and learning the store’s inventory better than any other employee.

The Golden Rule syndicate operated primarily in Western farm and mining towns. Unlike other stores in the region, Golden Rule stores accepted only cash — a practice Penney’s stores continued until 1958. The store’s buying network allowed them to stock quality products at prices lower than the competition.

Penney prospered in Callahan’s employ. He made such an impression that he was eventually offered a one-third share in a new store located in Kemmerer, Wyo. — considered today to be “the Mother Store” of the J.C. Penney chain.

The partnership arrangement would become the model for the J.C. Penney empire of department stores. A merchant would take a young man under his wing and teach him to manage his own store. That man, in turn, would take the helm — and a share of the ownership — at another store and train others to continue the chain. It was in this way that Penney truly became the man with a thousand, and many more, partners.

By 1912, Penney was the principal partner in more than 34 Golden Rule stores. “James Cash Penney — His Life and Legacy,” published by the J.C. Penney corporate archive and museum in Plano, Texas, addresses the significance of the store name. “To him, the Golden Rule name represented more than a marketing strategy. It represented his deeper philosophical and religious beliefs and became the credo of his company.”

During the 1930s and ‘40s, J.C. Penney would occassionally exhibit prize livestock from the Penney and James Farm in the Hamilton J.C. Penney store. Penney is shown near the center of the photo, which dates from 1937. Photo courtesy of the collection of E. Tom Strade, Tom Strade Photography, Hamilton and Bethany, Mo.

Although the Golden Rule would continue to guide the company, the name itself was phased out. In 1913, the J.C. Penney Co. was incorporated and stores began to bear the founder’s name (years later, the periods were dropped). The growth of the company exploded with the force of profit sharing and manager ownership. A company newspaper and employee training courses spread Penney’s practices and philosophies of retailing. Penney personally interviewed thousands of prospective “associates” — smokers and heavy drinkers need not apply.

In 1920 the J.C. Penney Co., headquartered in New York, had 197 stores, mostly in Western states. Nine years later, there were more than 1,200 J.C. Penney stores nationwide — a rate of growth that saw a new store open every three days.

A life of purpose

In an unusual move, Penney stepped down as company president in 1917 and assumed the title of chairman of the board of directors. Free from the day-to-day management of the company, Penney concentrated on guiding his company’s future.

His writings in the company’s employee publication, originally called The Dynamo, were full of homespun wisdom and the experience of a talented merchant. He became known for a seemingly endless string of maxims and pearls of wisdom:

“Nothing is useful that is not honest.”

“Clock watchers never seem to have a good time.”

“Luck is the last refuge of laziness and incompetence.”

“Give me a stock clerk with a goal and I’ll give you a man who will make history. Give me a man with no goals and I’ll give you a stock clerk.”

Penney stands in front of the Hamilton J.C. Penney store during a visit in the early 1960s. Photo courtesy of the collection of E. Tom Strade, Tom Strade Photography, Hamilton and Bethany, Mo.

His insistence on cleanliness and his frugality were legendary. He was well known for correcting a store manager’s sweeping technique, even taking a broom in his own hands to go back over a floor. He chided clerks for leaving the lights on and offered personal instruction in wrapping packages or fitting clothing.

While most of Penney’s attention was devoted to business, it was not entirely so. He traveled in Europe (he had passage booked on the second voyage of the Titanic) and led his family on cross-country automobile trips. He had a luxurious home in New Jersey and a mansion in Florida, which he made available to President Herbert Hoover.

Although he didn’t draw a salary from the J.C. Penney Co., the founder became a wealthy man from stock dividends. He bought a New York dairy farm and invested heavily in Florida real estate. He created a retirement complex for ministers, lay church workers and missionaries — the first planned retirement community in Florida. He purchased 120,000 acres in hopes of creating a cooperative farm community, with a partnership plan modeled after his successful store ownership structure.

The stock market crash of 1929 and the resulting Great Depression were devastating both financially and emotionally to Penney. He had borrowed heavily against his company stock, and it’s believed he lost nearly $40 million almost overnight as bankers called in loans on his investments.

“One night late in 1931, I was convinced I would never see another dawn. I wrote farewell letters to my family. Then I waited for the end — a failure at the age of 56,” Penney wrote, recalling his despair while recovering from emotional collapse in a Michigan sanitarium. The account, published in the November 1952 issue of Journal of Living recalls the tycoon’s renewal of faith.

Located on the site of Penney’s father’s farm, the Penney and James Farm outside of Hamilton was known nationwide for champion Angus cattle. Photo above courtesy of the collection of E. Tom Strade, Tom Strade Photography, Hamilton and Bethany, Mo.

Penney credited the sound of a hymn being sung by fellow patients with turning his life around and giving him renewed hope. He recovered from his despair and reluctantly agreed to accept a salary from the company he founded until he could get on his feet again. While he never regained all he lost financially — his estate was valued at $25 million at the time of his death — he returned to wealth and lived the rest of his days in comfort.

His religious transformation inspired speeches and writings for the rest of Penney’s life. He was a regular contributor to The Christian Herald, and his columns were later published in book form.

“As a young man, he so focused into his business that he let his personal life and his physical health deteriorate. As an older man, he realized the purpose of balance,” says Joan Gosnell, a corporate librarian who once maintained the Penney Archives and now manages a collection of Penney’s personal papers at Southern Methodist University. “He got into philanthropy. He gave back to his community. He had his farms. He became somebody that we can look at and say, yeah, he made a difference.”

Although Penney stepped down as board chairman in 1946, he remained a director. He spent the rest of his life representing the J.C. Penney Company in public appearances and store visits. According to published company history, at the age of 85, Penney logged more than 80,000 miles visiting 67 stores.

Never far from home

Throughout his life, Penney maintained a strong attachment to his hometown. In the 1930s he purchased the farm once owned by his parents and operated a showplace livestock operation there until the mid-1950s.

Penney admires a prized Guernsey cow at his New York dairy farm. The farm and its herd of cows were donated to the University of Missouri in 1952 and continue today as the school’s Foremost Dairy Center. Photo courtesy of the University of Missouri Extension.

Initially, Penney raised mules and horses at his Homeplace Farm but later concentrated on Aberdeen-Angus cattle. The farm was a thing of beauty, with rail fences stretching 2 miles along Highway 36 and large barns, which housed champion cattle and hosted sales that attracted buyers from across the country.

“He had a passion for livestock,” says Harold Henry, who owns 800 acres of Penney’s Hamilton farm and knew the merchant well. “He felt like if he could buy the best bulls and a bunch of good cows of any breed of cattle, he could produce a genetically superior animal.”

One bull in particular, the “Wonder Bull” Eileenmere 487 was considered one of the most successful sires of championship cattle in all of America. His tombstone still stands on the farm. Another bull brought a record $87,000 during the final dispersal sale of the Penney & James farm in 1955. The million-dollar auction — the largest in Angus history at the time — brought buyers from every U.S. state, Canada and Scotland.

Penney owned at least eight farms, totaling more than 8,000 acres, in northwest Missouri. Besides Angus and Hereford beef cattle, his farms raised champion Guernsey dairy cows, sheep and pigs. Another Penney farm, located in New York, was home to the finest Guernsey dairy cattle operation in the United States. In 1953, Penney donated that farm and herd to the University of Missouri. The $750,000 gift funded a dairy research farm that still operates today.

“He was way ahead of his time in agriculture,” says Henry, who was just a child when Penney would visit the farm where his father worked and lived. Penney often included the young boy on his tours of the property, examining cattle, picking up debris along the fences and checking up on crews.

“He took care of the land. He took care of his cattle,” he says. “So many people don’t understand that about him. But I do, because I watched him.”

Whenever he was in town, Penney took time to visit the JC Penney store downtown, where he would greet customers and share advice about merchandising with the store’s staff. Penney would arrive without fanfare and often would be found talking farming in a local diner.

Hamilton cattleman Harold Henry owns 800 acres of Penney’s Homeplace Farm, including the sale barn where Angus cattle auctions conducted by Penney and James attracted national attention. At age 11, Henry met Penney. The two remained close for 25 years.

“He used to go in there and eat, and a lot of people didn’t even know who he was,” recalls Hales, whose family’s grocery store was located next to the JC Penney store and received many visits from the founder, who came in sit, visit and enjoy a bottle of buttermilk.

Penney’s interest was not limited to the store or farm, though. He contributed generously to civic efforts and helped fund a new library and high school. In 1946 he was instrumental in attracting an International Shoe factory to Hamilton. The factory, which operated until the 1990s, employed about 300 people and made children’s shoes for Penney stores.

“He didn’t forget us,” says Hales. “He liked these people. He got enjoyment out of this town. It just meant a lot to him.”

Today, a museum, located inside of the town’s library, displays artifacts from his life and career. His boyhood home was moved to a park downtown and is available for tours. Penney’s 1947 Cadillac convertible, now owned by Dean Hales, can be seen through the picture windows of a small garage located at Highway 13 and 36.

A thorough survey of attitudes about James Cash Penney in Hamilton will still find a few individuals who resent his success, but most residents are proud of their favorite son.

“I’ll always be indebted to him,” says Henry, who recalls with fondness a time Penney told his mother how much he liked the young boy. “He had all this money and he took the time to do that. A guy who would take time to encourage a kid, he’s got something pretty good in him.”

The J.C. Penney Museum is located at 312 North Davis St. in Hamilton. For more information, call 816-583-2168.

Rural Missouri | June 2020 Issue

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