Abstract: Failing at Retailing (and Other Things): The Decline of the Larkin Company, 1918-1941

Howard R. Stanger


Begun as a manufacturer of soaps in 1875, in Buffalo, NY, the Larkin Company grew to become one of the largest mail-order companies by 1900. Larkin grew phenomenally during the 1910s, owing to its club-based selling scheme, and become a large vertically-integrated, but hybrid company. Its sales peaked in 1920. Beginning in 1918, Larkin joined the chain store movement by opening two grocery chains, a few departments stores, gasoline stations, and other retail stores during the 1920s. But both external (the decline of the farm economy, the Depression, changes in women\'s work, and the development of the supermarket) and internal (dissension in the executive ranks, a top-heavy and centralized structure, and poor strategic decision-making and execution) factors led to a slow decline after 1920 that accelerated during the Depression decade. By 1941, the company was liquidated, although it limped on into the 1960s as a warehouse company with a small mail-order and retail division. I conduct an autopsy of the company to examine the causes of Larkin\'s death in the context of recent work on organizational failure in organizational studies.