Watertown: Where the Five-and-Dime Was Born

Watertown, New York was settled in eighteen hundred by New Englanders who followed the Black River north and found something rare in upstate New York: a river that dropped forty feet through the center of town and a hundred and twenty feet within two and a half miles. That much falling water was an industrial engine waiting to be wired up. Within a generation, Watertown had paper mills, lumber yards, and machine shops all running on Black River power, and by eighteen oh five it had been chosen as the county seat of Jefferson County.

But the town's most durable contribution to American life came from a dry goods store and a young man who was willing to work for nothing. Frank Winfield Woolworth grew up in rural Jefferson County and arrived in Watertown in eighteen seventy-three to take an unpaid apprenticeship at Augsbury and Moore, a wholesale and retail dry goods operation on Public Square. He was about twenty years old and sleeping in the store's back room to avoid paying rent.

The owner, as an experiment, set up a counter selling merchandise at a fixed price of five cents per item. Fixed-price selling was not standard retail practice in that era. Customers expected to haggle. But the five-cent counter moved goods fast and attracted crowds. Woolworth absorbed the lesson carefully. When he finally went into business for himself, he built his entire model around it, opening his first successful five-and-ten-cent store in Lancaster, Pennsylvania in eighteen seventy-nine.

The F. W. Woolworth Company eventually grew to become the largest retail chain in the world by the early twentieth century, with more than one thousand stores on multiple continents. The logic that started it all, fixed low prices in volume, was the direct ancestor of the discount retail model that eventually produced Walmart, Target, and every dollar store you have ever seen.

Watertown honored its favorite adopted son with a six-story Woolworth Building on Public Square, completed in nineteen twenty-one, two years after Frank Woolworth died.