Fedco

Infobox_Company
company_name = Federal Employees' Distributing Company
company_
company_type = Department Store
foundation = 1948
defunct = 1999
location = Los Angeles, California
industry = Retail
products = clothing, footwear, housewares, jewelry, garden, appliances, sporting goods, produce, hardware, toys, electronics
homepage = None

Fedco "(Federal Employees' Distributing Company)" was a membership-based department store chain that operated in Southern California from 1948 to 1999.

History

Beginning

The chain was unusual in that it was a nonprofit consumers' cooperative. It was founded by 800 U.S. Post Office employees who wanted to leverage their buying power by purchasing goods directly from wholesalers. Lines included general merchandise, grocery, and in some locations, auto services and furniture. A lifetime membership was less than five dollars for employees of the U.S. government, students, and their family members. In later years, Fedco membership opened to the general public, with memberships being sold at swap meets. Fedco's lifetime membership cost $10 in 1998 [http://findarticles.com/p/articles/mi_m3092/is_1998_Nov_23/ai_53347494/pg_2] .

At its peak, Fedco had ten department stores plus three appliance-only stores, and served 4 million members.

Business Model

The management strove to make Fedco a one-stop shopping destination. The customer/member was presented with a wide variety of consumer products: camera equipment, office machines, major and minor appliances, garden supplies, clothing, jewelry, liquor and groceries. The stores also had a full-service deli and a separate produce department. Many stores also had a tire and battery shop. The corporate buyers often found one-of-a-kind deals on miscellaneous items. At the holiday season the garden department became a toy wonderland.

The stores were tightly managed and offered many young people their first jobs. To foster smooth operation, romantic interest between employees was discouraged, and married couples were not allowed to hold Fedco jobs concurrently.

Some of the departments around the periphery of the building were not Fedco businesses but concessions run by outside companies. As an example, the Stereo Components department was run by Coastron, seller of the Soundcraftsmen line of stereo equipment. Coastron paid rent to Fedco to operate in the building. Other concessions were the Optical Department (later bought out by Fedco), the Shaver Shop, Key & Lock Shop, and others.

The membership model was successful for Fedco for decades. It was common for the stores to be crowded, with long lines at checkout. (A picture of a packed LA Coliseum, posted above the drinking fountain near the exit of the San Bernardino store, proclaimed, "More people shop at Fedco stores each week than the attendance of the 1984 Olympic Games opening ceremonies!") There were separate registers for general merchandise, groceries and produce. As merchandise was bagged, the bags were stapled shut and the receipt stapled on the top. In a precursor to the common practice at most membership clubs today, the sealed bags and receipts were checked at the exit.

For most of its lifetime, Fedco was usually closed to customers on Wednesdays, though a number of employees would work re-stocking or taking inventory. During the Christmas season, Fedco would remain open 7 days a week to accommodate the customer surge.

Fedco Reporter

The Fedco Reporter was the store's catalog and magazine. The department was run by Art Director and Department manager Salvador Heredia and Editor Anita McManes. The Reporter was a bi-monthly 62 page dated catalog mailed to members. There were seasonal specials and sales with themes like "Buyers' Goof Days." In addition to showcasing products, it also contained short one-column articles. Most issues contained one article about updates in federal policy that might affect federal employees. The majority of the articles were about minor but colorful stories in California history, and were labeled with a "California Historical" logo.

Bankruptcy

Fedco predated the giant chains Wal-Mart, Target, Kmart, and fellow membership chain Costco, but remained a regional chain and eventually was unable to compete with the national retail titans. Fedco filed for Chapter 11 bankruptcy in 1999, at which point it had been the longest-operating membership-based store in the country. In an ironic final twist, most of its locations were sold to the Target chain. In addition, the $10 lifetime membership at Fedco was exchanged for a $300 Target coupon at the 1999 bankruptcy. [Discount Store News (October 25, 1999) " [http://findarticles.com/p/articles/mi_m3092/is_20_38/ai_57443499 Fedco to offer coupons to settle membership.] " Volume 38; Issue 20; Page 4.] The proceeds of the bankruptcy sale were placed in a trust fund intended to charitably serve communities that had hosted Fedco stores.

Locations

* MAIN DEPARTMENT STORES
**Buena Park, CA (opened 1993 in former May Company store. Second and last multi-level location with 3 floors. Razed for Wal-Mart)
**Cerritos, CA (Razed for Target Greatland)
**Costa Mesa, CA (Razed, replaced by Target Greatland, Henry's Marketplace, and other small stores)
**Escondido, CA (Former Sears store, opened early 80's, first multi-level Fedco - razed for Home Depot)
**Los Angeles, CA - La Cienega (Razed for Target)
**National City, CA (Former Montgomery Ward, razed for Wal Mart)
**Ontario, CA (now home to Ontario Police Department)
**Pasadena, CA (Razed for Target)
**San Bernardino, CA (Building remodeled into a multi-store complex)
**Van Nuys, CA (Razed for Target)

*PREVIOUS LOCATIONS
**San Diego (Euclid and 54th, building now used as an indoor swap meet)

ee Also

*Zody's

References

* [http://findarticles.com/p/articles/mi_m3092/is_1998_Nov_23/ai_53347494/pg_2 "New format positions Fedco for future growth"] by Robert Scally, "Discount Store News", November 23, 1998, retrieved September 18, 2006
* " [http://pqasb.pqarchiver.com/latimes/access/58831002.html?dids=58831002:58831002&FMT=ABS&FMTS=ABS:FT&date=Feb+19%2C+1988&author=KAREN+NEWELL+YOUNG&pub=Los+Angeles+Times+(pre-1997+Fulltext)&desc=Discount+Stores+in+County+Proliferate%3A+a+Profile+of+Fedco&pqatl=google Discount Stores in County Proliferate: a Profile of Fedco] " Los Angeles Times (February 19, 1988)
* " [http://findarticles.com/p/articles/mi_m3092/is_17_38/ai_55855246 A final farewell to Fedco.] " Discount Store News (September 6, 1999)