Woolworth disappears from downtown America

The bold, red lettering of Woolworth that has been a staple feature of downtowns all across the United States for more than a century is about to pass into American high-street history.

The Woolworth Corporation announced yesterday it was giving up on its efforts to turn around its chain of 400 FW Woolworth stores which have become a drain on its earnings. The shutters will begin rolling down on the shops for the final time over the next few months.

The decision will mark the end of an era in American shopping. As in Britain, the Woolworth brand still denotes for most people honest-to- goodness wares and decent prices. For years, a common feature of the US chain, which is unconnected with the UK Woolworth business owned by Kingfisher, were in-store lunch counters where shoppers could rest, refuel and chat.

While the "Woolies" monicker, popular in Britain, never took hold in the US, for most Americans Woolworths was associated with its "five-and- dime" heritage passed down by its founder, Frank Woolworth.

It was in Lancaster, Pennsylvania, in 1879 that Mr Woolworth decided that the success of his "great 5-cent store", where everything was 5 cents or less, was such that he could begin adding some items that cost 10c. And thus was born the ``five-and-dime'' format that became Woolworth.

While the formula endured for more than a century, and spawned sibling chains in Britain and elsewhere in the world, in recent years it has become frayed in the United States as competition in the clothes and housewares market intensified. Woolworth was hurt by such giants as K-Mart and Walmart and even specialised superstores such as Toys "R" Us.

In its efforts to save the brand, Woolworth Corp closed down scores of Woolworth locations where the losses were greatest. About a quarter of the remaining Woolworth stores are in the New York City area. Many of the leases held by Woolworth reportedly date back to the Depression and are therefore extremely favourable.

Even in the Connecticut town of this correspondent, the two Woolworths that used to be here just two years ago have closed. One was transformed into a glitzy branch of Saks Fifth Avenue, the other has become part of the fast-growing CVS chain of chemists.

Various attempts were made to update the Woolworth image. Many of the old lunch counters, for instance, were converted into coffee bars.

The company also attempted to emphasise cosmetics and home goods over other segments such as toys. But last year, the Woolworth chain still made a $37m (pounds 22m) loss.

The chairman of Woolworth, Roger Farah, recently warned shareholders that he considered 1997 as the make-or-break year for the Woolworth name.