Having practically no experience in retailing, Walton decided to start a business. Sam's original idea was to partner with an old friend, Tom Bates, but his wife thought a partnership was too risky, so he started all on his own. He began by checking out every book he could find at the library that could help give him an idea of how to start and grow a business. Then, he purchased a store from a man who was having trouble and losing money fast. He payed $25,000 for it, and $20,000 was borrowed from Helen's dad. Sam's goal was to make his first store, Ben Franklin, the most successful store in town in just five years.
One of the first lessons he learned was that you can learn from everyone. His wife remembers him always checking the items, prices, and displays at the nearby store, which was making two times the sales of Ben Franklin. His store was part of the Butler Brother's franchise, which turned out to be both good and bad. Sam was given all the tools to correctly keep track of his sales, but he wasn't allowed much freedom. They told him what to buy and how much of it to buy. Butler Brothers even required he buy 80% of the merchandise from them.
When he was brand new to the business, he followed their rules. But after a while, he began experimenting with different ways of doing things. Walton designed his own promotional plans and struggled to get his items directly from manufacturers so he could purchase them for less. It was the beginning of the ideas that later shaped Walmart. Another strategy he used to keep costs low was driving his truck to pick up items at the cheapest places he could find. He would take his finds to Ben Franklin and price them low, making them sell faster and in larger quantities. It was hard for other stores to compete. In just 2.5 years, Sam was able to pay off the $20,000 he owed Helen's dad. His annual sales for the first year were $105,000, the second year was $140,000, and the third year was $175,000.
Another way he promoted his store was by purchasing ice cream and popcorn machines, which were located in the parking lot. In five years, Sam met his goal, he was the top retail store in the area with $250,000 in sales a year. But Walton was forced to sell the Ben Franklin due to a mistake in the contract. Sam had to look for a place to start fresh.
Walton decided to settle in Bentonville, an extremely small town with plenty of tough competition to test his skills. He called his department store Walton's Five and Dime. Sam also decided to try out a completly new idea in this store to see if it would work for him, self-service. Before, almost all stores had cashiers wait on their customers. The idea worked, and he opened another Walton's Five and Dime in Fayettville. Nobody but the Waltons thought this store would survive since it had two major competitors. He proved them wrong and continued opening up stores. His biggest obstacle at this time was when a tornado hit his most successful store. But not even that could stop him. In fifteen years, his annual sales for his fifteen stores was a total of $1.4 million.
Sam Walton then got the idea to try opening a discount store, Walmart, rather than the department stores he was used to opening.
One of the first lessons he learned was that you can learn from everyone. His wife remembers him always checking the items, prices, and displays at the nearby store, which was making two times the sales of Ben Franklin. His store was part of the Butler Brother's franchise, which turned out to be both good and bad. Sam was given all the tools to correctly keep track of his sales, but he wasn't allowed much freedom. They told him what to buy and how much of it to buy. Butler Brothers even required he buy 80% of the merchandise from them.
When he was brand new to the business, he followed their rules. But after a while, he began experimenting with different ways of doing things. Walton designed his own promotional plans and struggled to get his items directly from manufacturers so he could purchase them for less. It was the beginning of the ideas that later shaped Walmart. Another strategy he used to keep costs low was driving his truck to pick up items at the cheapest places he could find. He would take his finds to Ben Franklin and price them low, making them sell faster and in larger quantities. It was hard for other stores to compete. In just 2.5 years, Sam was able to pay off the $20,000 he owed Helen's dad. His annual sales for the first year were $105,000, the second year was $140,000, and the third year was $175,000.
Another way he promoted his store was by purchasing ice cream and popcorn machines, which were located in the parking lot. In five years, Sam met his goal, he was the top retail store in the area with $250,000 in sales a year. But Walton was forced to sell the Ben Franklin due to a mistake in the contract. Sam had to look for a place to start fresh.
Walton decided to settle in Bentonville, an extremely small town with plenty of tough competition to test his skills. He called his department store Walton's Five and Dime. Sam also decided to try out a completly new idea in this store to see if it would work for him, self-service. Before, almost all stores had cashiers wait on their customers. The idea worked, and he opened another Walton's Five and Dime in Fayettville. Nobody but the Waltons thought this store would survive since it had two major competitors. He proved them wrong and continued opening up stores. His biggest obstacle at this time was when a tornado hit his most successful store. But not even that could stop him. In fifteen years, his annual sales for his fifteen stores was a total of $1.4 million.
Sam Walton then got the idea to try opening a discount store, Walmart, rather than the department stores he was used to opening.