Duluth’s Wholesale Trade (through 1910)

The conditions that have made Duluth the greatest shipping port in the world in the volume of its commerce are making it the wholesale depot of a territory of vast extent, the trade of which it must ultimately command by reason of those very conditions which fostered the growth of commerce, in spite of the opposition of vested interests of tremendous importance that were centered elsewhere. In 1909 the jobbing trade of Duluth was close to, if it did not actually exceed, $60,000,000. But that is a mere drop in the bucket compared to the enormous trade that is becoming acquainted with the advantages of the city as a wholesale market, and which is buying in Duluth yearly at a rate that is increasing the trade of the city by leaps and bounds. The sum total of the business is not greater because the trade did not really begin to grow until a comparatively few years ago. For many years the local houses had to remain content with getting a share of the new business generally. They could compete only in a small way with the long established houses in other centers.

The merchant in a newly developed country who felt no sentimental interest in a wholesale house with which he had been doing business for years, and who was not tied up by other bonds, was compelled, as a business proposition, to buy in Duluth, for the simple reason that he could make a saving in his freight bills which might suffice for a profit at a pinch. Now that the Duluth jobbers have acquired large resources, they no longer have to grope after the trade, but go boldly into every market and compete with houses in other centers. They have the money, the goods and the enterprise. These things they got in the course of development. The advantage of transportation that makes Duluth the best market for the Northwest to buy in, they always had.

The law of the survival of the fittest applies in trade as in everything else, and that individual institution or city which has a natural advantage must certainly survive in the long run. This advantage in the case of Duluth is so plain that it cannot be ignored. The difference in favor of the Duluth jobbers lies in the fact that one handling of the goods is saved as between producer in the East and consumer in the West. In any other jobbing center in the West there must be another handling of the goods and that must increase the price or reduce the profit.

Another-and no doubt the most important-factor in the trade in heavy goods is in the fact that Duluth takes the goods out of ship-bottom and ships straight to the interior dealer, cutting out the haul necessary when the shipment is billed first to a wholesaler at another point.

The Duluth jobbing house equipment is modern. No ramshackle warehouses with antiquated machinery mar the jobbing district. The men who have engaged in the wholesale business here are gathered from the other great jobbing centers. They came equipped with accumulated knowledge of the business and found a virgin field in which new ideas might be carried out without any sacrifice of ancient installation. They were able to put in their plants right from the ground floor up. They were able to pick out sites that fronted on the street, were bounded in the rear by docks and traversed by railroad tracks. Their saving in truckage alone would insure a very decent income for some pretentious concerns. The methods they applied in material things they fitted to the conduct of their business. Time and labor saving devices had their complement in goods that people wanted to buy-and they knew how to get to the people. Success was a matter of course-not the success that comes with years of plodding-there has been no time for plodding in the creation of this business. It was up to the jobbers of Duluth to demonstrate, and they demonstrated. They showed the Northwest that they could deliver goods quicker, cheaper and better than their competitors located at interior points. There was no sentiment in their appeal to the trade: they made a business proposition and they made good.

That is the reason why the jobbing trade of Duluth has increased from nothing at all thirty years ago to $60,000,000 in 1909.

There is perhaps another reason indicated in the fact that there are banks in Duluth carrying deposits of millions of dollars- that also has had its influence in the development of the jobbing trade, for the men behind the banks are to a very considerable extent the men behind the credit of the jobbing houses.

It is quite a different affair, this jobbing business in Duluth, today when the city has money to loan, to what it was in the days when Duluth had a broad and eager palm stretched out to the lending world. That time is gone-forgotten in the flood tide of prosperity that has set in for all kinds of trading, in money or goods. The surplus money is finding active employment in trade as rapidly as it can be absorbed, the capacity of Duluth to utilize capital in business is being enormously expanded, and on every hand there are evidences that the money is ready to back this trade expansion.

The jobbing trade of Duluth as it exists today is a thing of fifteen or sixteen years’ growth. There are some houses that have been in business longer than that, but not with their present organization. New men and new capital have been found for every line. But most of the great houses trace their origin to earlier times, to those times when the supremacy of Duluth in commerce had not been asserted and business men had to be content to handle a volume of trade that would not be regarded as important in these days of vast transactions yearly. Ample means to exploit resources are no longer lacking in the jobbing community and that fact accounts for the other fact that it has been the experience of the houses established within the past fifteen years that their second year’s business was almost invariably twice that of the first year.

There is no pretentious jobbing house in Duluth that is not approachable by rail and water to its very doors. There are none that are not readily accessible from the heart of the city. The truckman has no place in the economy of the jobbing trade except for city deliveries. There is no piece of machinery that facilitates the handling of goods in use anywhere that is not in use in Duluth and there are many facilities available here that are not to be had elsewhere. Time, money and labor saving devices are first considerations in all the buildings. And in spite of the fact that goods are handled by methods that save immensely in the item of labor, the jobbing trade of Duluth gives employment to between 3, 000 and 4, 000 people. This is in the distinctly jobbing end of a business that is quite often so combined with manufacturing that it is not easy to divorce the one from the other.

To a greater extent than elsewhere in the country the jobbers have become manufacturers. They went into manufacturing to protect their own trade. When the jobber found a considerable and sustained demand for something in his own line that was not manufactured at Duluth and which he knew could be profitably made here, he put in a factory by the simple process of adding to his house room and installing the machinery. There is at least one house in Duluth which might be divided into a jobbing house and a manufactory, and each would compare in size and volume of business with any house in the line in the Northwest. The house of Marshall-Wells is probably generally known as a wholesale hardware house. As a matter of fact, they manufacture and sell every year over 100, 000 horse collars. The fact is stated as a striking instance of the remarkable enterprise that some of these Duluth wholesalers have displayed.

Sources:

  • Woodbridge, Dwight and John Pardee, eds. History of Duluth and St. Louis County Past and Present Vols. 1 – 2. C. F. Cooper & Company, Chicago: 1922.