4 The Sterling-Lindner-Davis Story

The Sterling-Lindner-Davis Company represented the oldest of eight major department stores in downtown Cleveland.  It began rather modestly in 1845 as the Thomas S. Beckwith Dry Goods Company.  A highly respected and innovative business leader, Thomas Beckwith (1821-1876) operated a very successful enterprise for many years. ^[1]  His store at 187-189 Superior Avenue featured costly broadloom carpets, ornate window shades, historic tapestries and elegant lace curtains. ^[2] George P. Welch and W.R. Havens in 1865 joined the firm.  With the addition, in 1867, of local retailer Frederick A. Sterling, this specialty store became Beckwith, Sterling and Company. ^[3]

Known for its oil cloths, upholstered goods and velvet, Beckwith’s enjoyed a period of unprecedented growth following the Civil War.  Under the able leadership of Frederick A. Sterling (1831-1919), this retail establishment, in 1874, moved from its cramped Superior Avenue quarters to a more modern and spacious facility at 6 Euclid Street. ^[4] With the death of T.S. Beckwith, the store became known as Sterling & Company.  Sterling & Company remained at that site until 1883 when it relocated to 10 Euclid Street.^[5] These premises featured ornate lighting, splashy glass display counters and thick broadloom carpeting.

Providing free carpeting for large commercial structures such as auditoriums, office buildings and hotels, helped to promote this department store.   Sterling & Company also furnished free carpeting for special events and model homes. This advertising devise impressed many including Euclid Avenue millionaires.  They increasingly shopped at Sterling & Company.  A sizable investment by George W. Kleim, in 1885, led to the store’s incorporation in January 1886.  Now recast as Sterling & Welch Company, this retailer soon found that its limited selection of merchandise hindered its potential future growth.  In particular, their lack of home furnishings forced the wealthy Euclid Avenue crowd to look elsewhere.  In order to remedy this situation, Sterling & Welch expanded its product lines to include quality furniture, special electrical fixtures, comfortable hammocks, and beautiful Turkish rugs. ^[6] Store officials also offered porch canopies and luxurious matting.

Expanding their lines paid-off handsomely.  It soon became the popular store for Cleveland’s elite.  Store officials cherished that distinction for many years.  National trade journals at the turn of the last century praised Sterling & Welch as one of Ohio’s finest and largest home furnishing stores.  Their knowledgeable sales staff was second to none.  Economic depressions in 1893 and 1907 did not adversely affect it as store sales reached impressive, new levels.

To celebrate its phenomenal growth, Sterling & Welch Company in 1908 began construction on their new department store.  Situated in the heart of Playhouse Square at 1225-39 Euclid Avenue and designed by the noted local architect J. Milton Dyer (1870-1957), this $500,000, five-story reinforced steel structure featured a fanciful terra-cotta exterior veneer.  It opened for business in May 1909. ^[7] Sterling & Welch was now the 4th largest store in Cleveland.  Its landmark French styled wrought-iron and glass front portico shielded shoppers from inclement weather for many years to come.  This new retail establishment included model showrooms, 3,000 sprinklers, three large elevators, a freight elevator and an attached warehouse.  It also boasted a pneumatic messenger service and state-of-the-art cleaning system throughout.

The Sterling & Welch Company took great pride in their versatile interior decorators.  They knew quality design and recognized value.  The store expanded its merchandise line further during the First World War.  New items included such things as specialty lighting fixtures, electric radiators, refrigerators, electric iron and washing machines. ^[8]  Employees also volunteered in preparing supplies for the various military hospitals. ^[9] The 1920s began with officials expanding the store’s delivery fleet.  Board members also unveiled the “the Aisle of Gifts.”  Placed within the store’s enormous atrium, this aisle made Christmas shopping much easier especially for men.  Sales rose significantly during the mid-1920s with the introduction of vacuum cleaners, metal safety deposit boxes and Japanese wicker baskets.

Officials, in the 1920s, also introduced their-own Bureau of Suggestions.^[10] This new department, in cooperation with its decorating division, offered advice on redecorating homes and offices.  The Sterling & Welch Company also sponsored an interior decorating show on WJAX-radio.^[11] It opened in 1926 a new warehouse and prestigious art gallery.  An outgrowth of an earlier traveling show that featured painting and sculpture, this gallery sold fine art.  The public loved it and it soon became a permanent department in Sterling & Welch.^[12]

Further additions to this store in the late 1920s included an expanded china and crystal department, majestic living room exhibition, model kitchen, lighting salon and floor covering gallery.  Sterling & Welch in June 1929 opened its-own special economy basement.^[13] This department contained fifteen model rooms each with its-own inexpensive furniture, curtains, lamps, mirrors and pictures.  The Great Depression of the 1930s represented a period of great change and compromise for this store.  This venerable retail establishment attempted to help its customers financially.  It unveiled a new deferred payment plan whereby qualified customers had up to eight months from the time of purchase to pay the balance due without incurring any additional charges.^[14] New merchandise presented in the 1930s included electric ranges, different brands of -radios and phonographs and improved electric washing machines.

Officials at Sterling & Welch also sponsored a number of special promotions and contests throughout the 1930s and 1940s.  One of these promotions involved a mechanical robot called Willie Vocalite.^[15] It could do many things much to the delight of its audience.  Store officials also co-sponsored Annual Treasure Hunts.  Winners won over $2,000 in cash prizes.  Store executives, in 1932, unveiled their first spruce Christmas tree.^[16] An immediate favorite with shoppers, it was located within the retailer’s gift shop court.  By the 1960s, it topped fifty feet and included 1,300 electric lights, 1,500 ornaments and 60 pounds of tinfoil icicles.  Sterling and Welch, in 1940, led the pact when it introduced mail order shopping and special mail-in coupons.^[17]  Christmas gift certificates also appeared for the first time in 1940 as did free home demonstrations for the brand new Apex Deluxe Cabinet Ironer.^[18]

The winter of 1942 found executives at Sterling & Welch selling a great many U.S. War Bonds and Savings Stamps.  Store officials, that same year, shortened business hours and put a freeze on hiring.^[19]  Unfortunately, unanticipated new problems surfaced much to the dismay of store executives.  The American Federation of Labor Retail Clerks Union, dissatisfied with management’s treatment of union employees, closed the store on March 12, 1946.  Store officials asked the National Labor Relations Board (NLRB) to select a bargaining agent for their 240 union employees.  The retail clerks union complained saying that unfair labor practices by the store’s owners had prompted this shutdown.^[20]  A court injunction limited the number of picketers to two, one at each of the store’s entrances.  This dispute ended quickly.

Store profits in 1947 and 1948 improved slightly.  However, they paled when compared with the high profits enjoyed by other downtown department stores over that same two year period.  Changing customer tastes as to what constituted fashionable interior décor and home furnishings spelled disaster for traditional downtown retailers such as Sterling & Welch.  That store catered primarily to traditional wealthy classes who mostly favored classic designed furniture and interior accessories.  However, Cleveland’s new rich thought differently.  They liked modern, avant-garde styles.  The fact that many modern pieces of art and furniture may have lacked the quality attributed to traditional home furnishings did not faze the younger generation.  They viewed traditional department stores such as Sterling & Welch as stodgy and old fashion.  These stores symbolized the kind of places that their parents and grandparents liked to shop, but not them.  Even its fantastic Christmas tree and surrounding bright displays were not enough to keep them within the fold.  They wanted retailers that catered to their mobile life styles.

The owners of this highly prestigious store, in 1947, began talking merger with prospects buyers.  However, nothing materialized until March 1949 when Allied Stores, the new owner of Lindner & Davis Company, purchased controlling interest.^[21]  The new Board of Directors immediately authorized an $8,000,000 refurbishing of the downtown store.^[22] The architectural firm of Ward & Conrad won the bid.  Although the front façade of the forty year old structure received a major face lift, the ornate exterior marquis remained untouched.^[23]  Sterling-Lindner-Davis eventually moved into the former Higbee’s building located at the corner of Euclid Avenue and East 13th Street.  Major renovations included modern incandescent aluminum spotlights, Plexiglas display shelves and tilt-away drawers.

This merger involving three major downtown Cleveland department stores represented a major triumph for Allied Stores.  Davis and Lindner were nationally-respected retailers.  The older of the two, W.B. Davis Company opened, in 1880, at 241 Superior Avenue.^[24] Founded by William B. Davis and Edwin Parsons, it became one of the first retail establishments in the country to offer a complete line of men’s furnishings including ready-made shirts.  A booming business with a wealthy customer-base from day one, W.B. Davis Company soon outgrew its cramped quarters.  It relocated, in 1896, to larger facilities at 21 Euclid Avenue.^[25]

A prominent Cleveland businessman, William B. Davis spent much of his time on his many philanthropic activities.   They included missionary work in Africa and expanding the YMCA.^[26] Active in church affairs and civic reforms, Davis supported a wide range of community-based programs such as Indoor Games for Disadvantaged Youth to summer camp for inner-city youth.  The Cleveland Civic Federation, in 1894, named him one of the city’s most prominent citizens.  He also supported public improvements such as new arc street lights for Euclid Avenue.

William B. Davis, like many other late 19th and early 20th century business leaders, recognized that his long-term financial success depended on finding the proper niche.  Realizing that most of his competitors did not sell quality sportswear or athletic gear, Davis, in 1900, became the sole Cleveland agent for Aertex Cellular Undergarments.  Athletes liked their durability.  He also offered clothing and equipment for football players.  He even provided free football guide books.  The store’s motto during the first decade of the 20th century said it all “When We Cut We Cut.”^[27]  The public loved to shop there.  Davis, in 1907, moved his store to 307-311 Euclid Avenue, next to the Old Arcade.  Within walking distance of other department stores, William B. Davis joined them in promoting special events such as Joint Trade Week and Home Weeks Celebrations.^[28] High profile activities such as those brought customers downtown.

Always ready to seize upon a golden opportunity, Davis soon expanded his retail lines to include women’s and children’s clothing.  Expanding his clothing lines may have generated additional sales; however, it also resulted in high inventories.  Opening a bargain outlet provided a practical solution to that dilemma.  William B. Davis, in 1917, leased a site at 260 Superior Avenue to sell his overstock.^[29]  At the same time, he also rented additional floors in his building and annex.  Women’s and children’s clothes along with fashion accessories occupied the upper stories of the main building, while the annex became the new men’s store.^[30]

Davis believed very strongly in promotional activities and advertising.  He knew what his customers wanted, and he never hesitated to give it to them.  For example, he gave away a booklet in 1916 entitled “Correct Dress.”^[31]  This guide assisted shoppers in selecting the “proper” evening attire.  W.B. Davis Company also encouraged patrons to buy Christmas gifts earlier and arrange to have his store deliver them to their homes closer to the time.

This highly successful retail establishment led others in provided gift certificates for new customers valued anywhere from $1.00 to $3.00.^[32] It also furnished lists of desirable Christmas gifts based on customers’ pocketbooks.  Store officials, beginning in 1917, initiated a liberal Christmas gift exchange program whereby those receiving unwanted gifts were able to exchange those items for others without the original purchaser accompanying them to the store.  “At your Service” symbolized much more than a catch phrase it was why W.B. Davis Company existed.^[33]

The end of the First World War signaled other significant changes.  Executives, in 1918, proudly announced that their store would be carrying the Kuppenheimer clothing line for men and boys.^[34]  Not surprisingly, W.B. Davis Company soon became Cleveland’s largest men’s specialty store.  It also became the city’s exclusive agent for Hickey-Freeman clothiers.  Its distinguished patrons included the likes of President Warren G. Harding and Cleveland business mogul John D. Rockefeller.

Other major changes during the “Roaring Twenties” included closing the Superior Avenue outlet and adding a new stylish hair salon.  The W.B. Davis Company, in 1922, opened its-own restaurant called Schuder’s.  It offered daily luncheon specials for only $.30.^[35]  This store also became a favorite with the country club set who purchased premier golf equipment at reasonable prices.  Although William B. Davis, in 1927, retired from this business, he remained active at the store for the next fourteen years.

This well-run operation prospered into the Great Depression of the 1930s.  Like its competitors, store sales plummeted during that decade.  Davis tried to reverse this downward slide in the mid-1930s by introducing a modified installment plan.  This installment plan required a minimum down payment on high cost merchandise and permitted up to six-months to pay the balance.  However, there were few takers.  Shrewd buying practices enabled W.B. Davis to weather the economic devastation wrought by the Great Depression.  Periodic sales such as the “After Christmas Sale” liquidated overstock.^[36] Sales began to rebound in 1940 as more Clevelanders returned to work.  Few envisioned the problems that lay ahead.

Store employees, in August 1941, mourned the loss of William B. Davis who was 90 years old.^[37]  W.B. Davis Company, during the Second World War, along with the other downtown department stores worked diligently to sell war bonds and stamps.  This retailer also assisted the American Red Cross and various other civic groups in providing bandages, medicine, and other sundries to those serving in the armed force.  Davis offered returning soldiers free wallet-sized photo copies of their discharge papers.  Store officials also provided discharge emblems for only $.50 a piece plus tax.^[38]

Rumors surfaced immediately following the Second World War that W.B. Davis Company was about to be sold.  Dwindling sales and mounting costs prompted this speculation.  However, store officials remained silent on this issue.  Allied Stores, in November 1947, announced that it had purchased W.B. Davis Company for the bargain price of $750,000.^[39] The new Sterling-Lindner-Davis Company opened on August 1, 1949 to rave reviews.

Three well-known retailers Max J. Lindner, Max Hellman and Morris A. Black, in 1908, founded the Lindner Company.  Max J. Lindner first came to Cleveland to serve as the General Manager for a major New York-based women’s clothier called Oppenheim Collins & Company.  Located on Euclid Avenue just to the east of East 9th Street, Oppenheim Collins remained in business until the 1930s.  He served twenty-five years as a buyer for the May Company beginning in 1920.  He was 73 years old when he died in September 1945.^[40]

Max Hellman also had a well-earned reputation in women’s fashion and served as the President of Lindner’s until his untimely death in 1923.  He was only 47 years old.^[41]  A graduate of Harvard University and past President of H. Black & Company, a well-known women’s clothing manufacturing firm, Morris Black (1869-1938) proudly served as Lindner’s President for thirteen years beginning in 1923.^[42]

This retail establishment originated as a specialty shop for women.  Known as Lindner Co’y, it quickly gained a national reputation for selling quality items many imported directly from Paris.  Top quality promoters in their-own right, Lindner, Hellman and Black frequently relied on promotional events and sales to stimulate business.  One annual event called “Celebrate Style Week” brought thousands downtown.  This celebration unveiled the latest fall and winter fashions.^[43]

Increasing sales convinced officials, in 1915, to vacate their small East 9th Street quarters for new, more spacious quarters at 1331 Euclid Avenue.  Thousands, the following year, flocked to its grand opening.  They marveled at its elegant décor, exquisite furnishings, beautiful clothing and excellent sales staff.^[44]  No other retailer between New York and Chicago could boast of such a beautiful setting.  Later additions included a fashion setting millinery shop and popular tea room. This tea room offered patrons delicious $.65 lunches that ranged from club steak dinners with au gratin potatoes to corn beef hash with a poached egg.^[45]

However, Lindner Co’y represented much more than just a prestigious department store.  Its executives supported many worthwhile causes.  For example, a group of alumni from Goucher College in the mid-1920s worked at the store for one day.^[46] The proceeds they earned that one day went towards establishing a college endowment campaign.  Store officials four years later worked diligently with high school students from Brown Hathaway Academy to present a fashion show.  Local charities received the funds generated from this event.

These kinds of community-based activities paid-off well.  High profits, low overhead costs and a growing national reputation for high quality merchandise and honest prices encouraged Lindner’s to establish branch stores.  By the late 1920s, it ran stores in Toledo, OH; Mansfield, OH, Erie, PA, Elmira, NY and Binghamton, NY.

During the Great Depression of the 1930s, this highly innovative store introduced its-own new installment buying option.  Officials permitted customers with good credit to pay off their monthly bills in three installments rather than have them pay one large sum at the end of the payment cycle.  No hidden fees or added interest charges for this service.  Not to be outdone by others, Lindner’s, in the 1930s, ran periodic sales that focused on noteworthy events.  They included “The Apple Blossom Sale” and “Three Day Handbag and Outerwear Sale.”  Another promotional activity entitled “Living Music Day with the Carl Ludwig’s String Ensemble” brought thousands.^[47]

Lindner Co’y, during the 1935-36 shopping season, initiated several significant changes.  The first involved hiring “special shoppers.”  These “special shoppers” assisted male customers in finding that perfect gift for the women in their lives.^[48]  The second major change concerned expanding the store’s clothing lines.  It began in April 1936 with the introduction of men’s silk dress ties, Oxford shirts and hand stitched wool socks and ended that November with several new lines of men’s suits, sports jackets, pants and sports shirts.

Also, Lindner’s, in 1936, introduced a new restaurant called the Continental.  It featured reasonably priced French cuisine.^[49] Lindner Co’y board, that same year, announced extensive remodeling plans.  These plans called for more openness on all floors by eliminating existing tall display counters and replacing them with smaller units.^[50] This popular store scored another first that year when it opened the first beauty salon in the nation constructed entirely of glass.  Its chromium doors and see through windows blended in well with its black, peach, red and rose background shades.  That new salon featured ten stalls.

Lindner Co’y continued to prosper into the war years.  Like its competitors, Lindner’s did its part for the war effort.  Sales showed a marked improvement in 1945-46 as more enlisted men and women returned home.  Unfortunately, mounting overhead costs increasingly offset any sales gains.  A brief recession in 1946 further cut profit margins.  The store was in the red financially.  After some heated discussion, officials determined that they must either sell the store or file for bankruptcy.  Mack Gordon, the store’s CEO and majority stockholder, agreed.  His untimely death due to a plane crash in June, 1947 left the board no alternative.^[51] They must find a buyer and quickly.  Fortunately, a national chain was waiting in the wings.

Hoping to gain a sizable foothold in the Cleveland retail market, the highly successful Allied Stores seized the moment and purchased Lindner’s.  This sale occurred on the heels of a major announcement made by Bonwit Teller, a popular New York-based department store, that it had just signed a twenty year lease to occupy the former Lindner Building at 1331 Euclid Avenue beginning in August 1948.^[52] Coincidentally, that was when Lindner’s lease expired.  President Gordon’s replacement Simon Olson announced the merger in October 1947.  It cost Allied Stores about $1,000,000.^[53] Under this merger agreement, preferred stockholders received $43.00 a share for their Lindner stock through reissued Allied Stores stock.

Known originally as the Hahn Department Store, this national chain became the Allied Stores in 1935.  This growing retailer operated 73 stores including Boston’s prestigious Jordan Marsh Company.^[54] Its Acting Managing Director E. Perkins McGuire (1904-1982) announced that this merger along with the buyout of W.B. Davis Company would result in a brand new department store called Lindner-Davis.  A specialty store similar in many ways to Neiman Marcus or Saks-5th Avenue, the new Lindner-Davis opened in June 1949.^[55] This new downtown retailer welcomed over 75,000 customers on opening day.  Every person entering the premises that day received a baby orchid from Hawaii.  In the background, shoppers heard beautiful music played by string trios.^[56]

Allied Stores, announced in 1950, that it was adding Sterling & Welch to Lindner-Davis to create a new enlarged retail establishment called Sterling-Lindner-Davis.  The local press expressed great excitement about this new department store.  They saw this massive investment as a sign of wonderful things yet to come.  The “new and improved” Sterling-Lindner-Davis Company featured the well-known Allen Travel Agency and a prestigious new shopping service referred to as “Red Hat Service.”^[57] Conducted within a quiet, dignified in-store suite, Red Hat Service provided utmost service for discerning businessmen who wanted to purchase the perfect gift.

People came great distances to shop in its popular Oriental rug gallery and nationally-renowned furniture department.  Sterling-Lindner-Davis the “Homemaker’s Headquarters” also catered to thoughtful women.^[58] Store officials, throughout the 1950s, prided themselves on their Parisian fashion shows geared for up-and-coming Clevelanders.  This major retailer, during the Korean Conflict, sponsored bake-off contests with the winning cakes being sent to combat soldiers.^[59]  This store also supported numerous charities such as the Society for Cripple Children and the Children’s Aid Society.

The landmark Sterling-Lindner-Davis Christmas brought thousands of children and their parents to the store annually.  Over 50 feet high adorned with thousands of lights and nearly 100 pounds of tinsel, officials claimed that it was the largest Christmas tree in any U.S. department store.  In fact, it took volunteers almost 600 hours to decorate it.  Whether it was the largest tree or not this magnificent spruce pine lent a festive air to every holiday season.

The sales staff at Sterling-Lindner-Davis enjoyed good benefits and wages based in large part on its overall record sales.  For example, the board in 1950 reported overall sales of $476,692,651 with net earnings of $14,944,382 or $6.69 a common share.^[60] Allied Stores high profits and reasonable debt ceiling enabled store officials to hire very competent salespersons and managers.

Employee loyalty was tested in the early 1950s when the Van Drivers Union Local #392 of the A.F. of L attempted to unionize store employees.  The American Federation of Labor appealed to federal officials for assistance.^[61] The National Labor Relations Board and Wage Stabilization Board determined that the salary levels and fringe benefits offered Sterling-Lindner-Davis employees did indeed meet all federal guidelines and that unionization was not a priority.

Some disgruntle W.B. Davis & Co. stockholders, in 1952, filed a law suit in the U.S. District Court.  They claimed that the purchase of W.B. Davis & Co. represented a tax-free transaction and that they had been forced to pay taxes on it.  These stockholders demanded a refund.  Opposing counsel pointed out that this so-called tax-free transaction was, in reality, a simple company restructuring whereby the Allied Stores had exchanged 1 ½ shares of its-own company’s common stock for every one surrendered by Davis investors.  The District Court Judge found in favor of the defendant, no refund.^[62]

Allied Stores used a wide variety of promotions, in the early 1950s, to bolster sales.  For example, Sterling-Lindner-Davis, in 1951, introduced its-own version of the Easter Bunny.  This six foot bunny, called “Lindee,” handed children candy and other gifts in the weeks prior to Easter.  Store executives and Westinghouse, that same year, co-sponsored an impressive science display featuring the atom.  The Allied chain, in 1951, posted impressive sales records of $476,692,651 equal to $3.31 a share.  That compared with $439,908,620 in 1950.^[63] For customers interested in automobiles, the store, in 1952, showcased the latest models of Ford Motor Company along with other foreign sports cars.^[64] Officials, the next year, hosted a special exhibition dedicated to the Netherlands.  It included over 3,000 tulips.  An African violet exhibition also brought thousands of shoppers into the store.

Nineteen Fifty-three ended with Santa Claus arriving at the store in a new Jaguar sports car.  A talking mule, similar to the one featured in the popular movie comedies Francis the Talking Mule, entertained young children for hours at a time.^[65] Sterling-Lindner-Davis, in March 1954, dazzled its customers when it demonstrated the first color televisions available in the Cleveland market.  Manufactured by Raytheon Corporation of Sudbury, MA and costing over $1,200 a piece, they required a special $300.000 antenna.^[66]  Store executives also provided eight ponies for children to pet that summer.

One of its most successful promotions in the mid-1950s involved the city’s professional baseball team, the Cleveland Indians.  Every other year the store sponsored a contest for young boys.  The winner became the Cleveland Indians bat boy for the next two year period.  He also received $1,000 in cash and a complete Cleveland Indians outfit.^[67]  This retailer’s invitational golf outing also fired up the imagination of many of its customers.  Participating golfers not only had the chance to win prizes, but also, play in some of the area’s finest golf courses.  Sterling-Lindner-Davis, beginning in 1956, awarded special trophies to the winners of the Gordon Shore Boat Club’s Annual Sailing Marathon.

This retailer also received a prestigious national award from the National Retail Dry Goods Association for its highly effective advertising campaigns.  Unfortunately, profits did not continue to soar through 1954 even though net sales were up 2% over 1953 levels.^[68] This unexpected reversal in sales did not faze Allied Stores.  Officials knew that sales in their Cleveland store would rebound, and of course, they were correct.

Sales increased by nearly 20% during the first six months of 1955 over the previous year’s level.  Consolidated net earnings stood at $1,675,874 for the 2nd Quarter ending July 31, 1955.  That equaled $.56 a common share as compared to $1,316,241 or $.48 a share the previous year.^[69]  To mark this special occasion, the Easy Washing Machine Company of Syracuse, NY awarded Sterling-Lindner-Davis its coveted sales plaque.  This Cleveland store led the nation in the sales of their appliances.^[70]

The Equitable Life Assurance Society in September 1956 announced plans to invest $3,000,000 in Sterling-Lindner-Davis over the next two years. Net income for Allied for the three months ending October 31, 1956 was $3,131,197 or equal to $1.10 a share as compared to $3,373,718 or $1.22 a share for the same period in 1955.^[71]  Hoping to stimulate sales even further during the second half of the 1950s, the Board of Directors authorized the construction of a seven hundred car parking lot on the site of the store’s former warehouse and Navy Building.  Store officials announced that this new parking lot would provide both short-term and long-term parking.  Tenants displaced by this action included WEWS-TV-5; Innerman’s Records, Evangel Book Store and the International Shop.^[72]  It opened for business in 1957.

Riding the crest of its biggest sales volume ever, executives expanded store night hours.  Sterling-Lindner-Davis would now be opened Monday and Thursday nights with free shuttle service running between the store and Terminal Tower.  The Allied Stores expressed great confidence in their recent investments.  Officials firmly believed that this department store would continue to generate high returns for many years to come.  Unfortunately, their optimism quickly faded.

A recession that began in the fall of 1957 and lasted well into 1958 resulted in a 36% drop in sales.  With the idea of cutting mounting debt, the Allied Stores, in July 1958, reshuffled several departments.  Store officials combined apparel and fashion accessories and transferred notions and stationary to home furnishings.^[73] Board members believed that their move would make Sterling-Lindner-Davis more competitive by eliminating duplication of services.  Behind the scenes, the Allied Stores Board of Directors wondered if these changes would really bolster lagging sales or not.  It was anyone’s guess.   However, one thing was certain Allied Stores was making money even in the Cleveland store was not faring so well financially.^[74]

This new efficiency move might have proven to be a stroke of genius had the Cleveland retail market rebounded.  Regrettably, it did not happen.  A major decline in industrial jobs, growing poverty and a mass migration first to inner-ring suburbs and then later to other parts of the nation would spell disaster for many downtown department stores.  Only a select few would survive.  This economic reality so evident to even casual observers in the 1970s eluded the city’s retail leaders twenty years earlier.  Their traditional business strategies proved ill-advised given the volatile nature of the local economy.

Allied Stores officials, in the latter months of 1960, announced that further changes were coming.  However, they remained vague on specifics.  Instead, they said that the board was contemplating changing the store’s image or possibly converting it into a local discount department store.^[75] Allied executives, behind closed doors, asked other retail chains if they would be interested in purchase this store.  No one responded to their inquiry.  A Cleveland retail icon for nearly one hundred years, Sterling-Lindner-Davis’s recent lackluster sales performance spelled disaster.

However, any future plans to sell the store remained in the background.  Allied Stores, in 1963, faced a more immediate threat.  Theodore W. Berenson, a well-known Boston developer, filed a law suit in Common Pleas Court against Allied.  He wanted to purchase the Sterling-Lindner-Davis annex and an adjacent parking lot as part of a major new apartment complex.  Situated at the southeast corner of East 12th Street and Chester Avenue, the two parcels, in question, were part of the Erieview Urban Renewal project.^[76]

The Board of Directors demanded $3,200,000 for the two parcels which totaled 32,868 square feet.  City of Cleveland officials wanted to sell the sites for $1,600,000.  The Common Pleas court found in favor of Berenson and the City of Cleveland.  Allied Stores executives complied with the court order and demolished both the annex and adjacent parking lot.  Berenson erected the Chesterfield Apartments on the site.  This unfavorable court decision convinced the board that they must either close Sterling-Lindner-Davis as soon as possible.

Decreasing store sales in the mid-1960s made it worse.  Stockholders complained that Sterling-Lindner-Davis symbolized an albatross around their necks.  They had a point.  Allied Stores earnings in 1965 increased to $22,255,000 or $7.38 a common share as compared to $17,735,000 or $5.84 a common share the previous year.  Net sales that same year topped $955,490,000.  That represented an increase of $62,117,000 from 1964 figures.^[77]

This financial picture appeared very positive, but not for Sterling-Lindner-Davis which continued to post losses.  Board members found this unnerving.  Why were the majority of affiliates doing so well while Sterling-Lindner-Davis was doing so poorly?  The board responded by conducting their-own analysis.  They discovered that if the Allied chain could rid itself of Sterling-Lindner-Davis at that moment, its net earnings would increase by 11% and its debt would decrease by 15%.  All agreed that their downtown Cleveland department store must go.

The Board of Directors, in 1965, started furloughing Sterling-Lindner-Davis salespersons and managers.  They also discontinued some of the store’s quality merchandise.  This once respected downtown department store soon became a shell of itself.  The Allied Board of Directors on July 9, 1968 finally announced the closing of Sterling-Lindner-Davis.  Allied stores 2nd quarter earnings for 1968 stood at $800,925 equal to $.08 a common share down from $1,897,400 equal to $.23 a share posted the previous year.  Additional expenses incurred from closing both Sterling-Lindner-Davis and its Columbus, OH-based Fashion stores accounted for this downturn.^[78]

Midwestern Land Development Corporation purchased Sterling-Lindner-Davis.  This development company intended to build a 400-unit hotel at the parcel’s west end and renovate the store’s first floor for a bank.^[79] They also wanted to convert the store’s upper floors for office space.  The proposed hotel never materialized and Cuyahoga County now occupies the office space.  A prestigious retail shop utilizes the street level.

Sterling-Lindner-Davis was a victim of changing times.  The Allied Stores never understood downtown Cleveland retailing.  They thought that they would generate sizable profits year after year by simply riding on the coattails of their predecessors.  Why tinker with success?  In reality, Allied officials were reluctant to invest long-term in this store or adjust to the changing needs and wants of Cleveland shoppers.  Instead, they conducted business as usual.  Customers were not fooled by their actions.  Use to getting the best possible merchandise at the lowest possible prices, shoppers increasingly spent their hard-earned dollars at other, more fashionable retail establishments.  The necessity of following the business dictates of local retail markets never worried the Allied chain.  In their minds, an affiliate either fulfilled its intended profit goals or it was gone.  This steadfast bottom line rule sealed the fate of Sterling-Lindner-Davis.

Its closing had very little impact on the Allied Stores nationally.  Business went on as usual for that multi-million dollar operation.  Expansion remained a primary business objective for this retailer for the next twenty years.  However, all of that changed in 1981 when the Allied chain acquired a large conglomerate that included Brooks Brothers, Garfinkel’ and Miller & Rhoads.   That merger cost this retail giant $210,000,000.^[80]

These mergers sparked the interest of a shrewd Canadian entrepreneur named Robert Campeau.  He purchased the Allied Stores chain, in 1986, for $3,600,000,000 and Federated, in 1988, for $6,600,000,000.^[81] Campeau then merged the two chains to create one new retail giant called Federated Department Stores.  Faced with crushing debt, this retail chain in 1990 filed for Chapter 11 bankruptcy.^[82] Hoping to salvage the corporation, its creditors forgave $3,000,000,000 to $8,000,000,000 of its debt.^[83] A new, more fiscally responsible Federated Department Stores re-emerged in 1992.  Its board designated Macy’s its new standard bearer.