CHAPTER
ONE
one
humble beginnings
1850–1913
‘The only life worth living is a
working life with something
to strive for’ – GJ Coles, 1913
The first Coles store opened its doors on Smith St, Collingwood,
in Victoria. It was April 9, 1914; the Thursday before Easter. The
world was on the brink of war, and Australia’s first bank note had
only just entered circulation. Food was regularly delivered by the
local butcher or greengrocer using horse and cart, and milk was
often poured into a billycan left out on the front step. General
stores were the closest thing to a variety store, but that first Coles
store set in motion a chain of events that would revolutionise the
way Australians shopped.
2
1.
The Coles family’s St James store in 1899.
2.
George Coles, father of GJ Coles (1855–1931).
3.
George James Coles was the eldest son of a retailer, also George, who in turn was the son of
a pioneer gold seeker, the first George of many in this story. That first George – our founder’s
grandfather – is pictured here with his wife Sarah Jane, grandmother of Sir George.
The first George Coles worked as a miner in Victoria’s goldfields
during the heady days of the 1850s gold rush. These were rough
and ready pioneering times, and it didn’t take George long to
realise that there were better ways to make a living. He opened
a ‘store’ in a tent and began supplying provisions to the miners,
providing what they needed to eat, as well as their picks, shovels
and pans.
When our GJ was a child, the family home was in northern
Victoria with his father, mother and their family of seven
children. The gold rush had long since finished and GJ’s father
was making his way as a retailer, managing a number of stores
and properties through the region with the help of his family.
The shop windows displayed signs boasting ‘Nothing over
1/-’, yet even the ever-optimistic owner GJ Coles was
unprepared for the rush of customers who came that day, keen
to take advantage of the bargains in this innovative new style of
shop. What followed has been a century of delivering quality,
service and value to the Australian public, and yet, the Coles
story doesn’t really begin with the opening of that first Smith St
store. We need to step a bit further back if we want to see the
whole picture.
Forever seeking opportunities on the land and within farming
communities, the Coles family wasn’t afraid to move around,
and in 1899 they were at it again, this time to St James, a
thriving town supporting five hotels. The family enjoyed a period
of relative stability for the next six years there, but by the time
GJ finished school, his father was not in a position to finance his
further education. Instead, GJ was required to help his father
in the business, which – although neither knew it at the time
– within the next decade would be his own. Within weeks of
finishing school, GJ was working behind the grocery counter at
their St James store, earning 2 shillings, sixpence a week.
The founder of the Coles business was Sir George James Coles,
or GJ as he was affectionately known for most of his ninetytwo years. He was the eldest son of a retailer, also George, who
in turn was the son of a pioneer gold seeker. And in case you
hadn’t already guessed, his name was… George.
In a precious recording made not long before his death, GJ
recounts his formative years. ‘There never seemed to be any
money in our family,’ he recalls, ‘and I don’t actually know how
my father survived, but we never appeared to be that hard up.
1.
DID YOU KNOW?
Lamingtons first appeared in Australia in
the early 1900s. The chocolate and coconut
covered sponge owes its name to Baron
Lamington, Governor of Queensland.
2.
3.
’ Journey
George Coles
My father did all sorts of work in his early days, including butchery,
but gradually opened some country stores around St Arnaud
and then Western Victoria. The move to St James was because
my father was working for an auctioneer at the time and was
asked to go up and sell a store in St James and Lake Rowan, but
he bought them both himself. I heard him say it gave him quite
a lift.’
Small stores owned by GJ Snr in the
post–gold rush era.
The first Coles stores, 1899–1913.
GJ heads to Melbourne to get some
experience in 1913, then sails
overseas, returning to Melbourne in
1914 to start our story.
ST JAMES
NHILL
Overseas IN 1913
LAKE ROWAN
DIAPUR
19
13
JUNG
STUART MILL
MELBOURNE
GEELONG
1903
4
14
19
Australia became a Federated nation in 1901 as GJ entered
adulthood; ambitious, enthusiastic and prepared to work. During
his time at the St James store, he also began to develop ideas
about what he would do differently if he were in charge – about
how he would deal with the problem of credit, about the benefits
of cash sales and about guaranteeing customer satisfaction. It
was during these years that he also learnt about taking risks,
and about the difference between foolhardy and wise decisions.
He had also been well-schooled in the need to work hard. ‘We
didn’t have much time for sport or leisure – I’d go fishing if I
could when I was a boy, but we all had chores to do like wood
chopping or cleaning the fowl house.’ Many of those ideas that
took shape in the young GJ’s formative years have remained
as enduring values in the Coles business for more than one
hundred years.
In 1903, at a time when there were still no food labeling laws
and a selected government employee would taste a range of
foods to guess what they contained, George Snr purchased a
grocery, wine and spirit business in Malop Street, Geelong. In the
grocery section, the Coles family was cutting prices to meet the
competition of Hoopers, one of the biggest and most successful
Geelong grocers at that time. A price war developed between
Coles, Hoopers and Corio Cash Grocers when a 70-pound bag
of flour went from 25 shillings in March 1903 to 12 shillings
by September. During this period, GJ learnt a great deal about
promoting value, knowledge that was to prove invaluable in later
years. ‘That time taught me many good lessons about business
and being a merchant using very fine margins. There was severe
competition with Hoopers, but Harry Hooper was also my best
friend. He had high ideals: we belonged to the same church and
went to the same mutual improvement society together.’
In 1905, the family moved back to St James and twenty-yearold GJ was again put in charge of the grocery section of the St
James Coles store. Fond though he was of his family, GJ was
beginning to think that he needed to become more independent
of his father and start making his own decisions. At this time,
George Snr was looking to branch out and buy another store
in nearby Devenish and to put his eldest son in charge. GJ,
however, would only agree to this on two conditions: firstly, that
he would run the store his way, and secondly, that the finances
of the new store would be kept separate from the rest of the
business. George Snr refused, and GJ decided that this would
be a good time to leave the family nest.
Learning the ropes
GJ packed his bag and freighted it to Melbourne. He was
determined to become a storekeeper but was wise enough,
despite his youth, to know that he needed wider experience. He
took one last look around the town of St James, which by then
boasted a population of 150, and set off in search of success.
The trip, by bicycle and train, ‘cleared his brain’ and by the time
he arrived in busy, bustling Melbourne, he felt confident of his
future. He walked Melbourne’s streets for nearly two months
until he found a job with Crooks National Stores, one of the
biggest grocers in Melbourne, and embarked on the next stage
of his budding career.
After a little more than a year in Melbourne working for Crooks,
GJ returned home to St James to manage the family store –
this time on his own terms. Introducing changes left and right,
GJ began to advertise by mail, producing an early form of what
would become the Coles catalogue. Customers were notified
of a large sale where a central counter would display goods,
mostly drapery items, at 1 shilling each. The catalogue also
announced GJ’s new policy of ‘one price for all and 22 per cent
discount’ for those who paid their accounts before the twentieth
of the month. The sale was a success and within twelve months
GJ had substantially reduced his total stock, made a 5 per cent
profit on sales and had only one unpaid bill on his books. ‘I
had no choice but to learn about the economics of running a
country store and serving the community’, is how he remembers
that time.
Despite his success, by 1913 GJ could see no future in St
James. Not one to do things by halves, he sold the business,
paid off all his bills and headed back to Melbourne with £2000
and a passion to start his own business in the big smoke. ‘First
of all, I had a good holiday with my friend Claude Roper (who
would go on to be an early Coles investor) but after a month of
lazing about I grew completely tired of it. I learnt that the only
life worth living is a working life with something to strive for.’ And
that’s just what he did.
Enthusiastic but not impulsive, he needed to know more before
he could truly cement the innovative business ideas that were
taking shape in his mind. He wanted his stores to revolutionise
Gold rush retailing
Men from all over Australia, not to mention
the world, flocked to Victoria’s goldfields
during the 1850s to make their fortunes, but
it was the people who set up stores who made
a more sustainable living. Mutton cost around
5 shillings a quarter at the time, and tea and
coffee were 3 shillings a pound. Sugar could
be had for the bargain price of 1 shilling,
sixpence per pound, but miners could expect
to pay 7 pence for a biscuit, tuppence for a
pint of water and up to £10 for a 100-pound
sack of flour. The average working man’s
wage at the time was less than £100 a year,
although on the goldfields, the lucky ones
might make many times that. Most, however,
did not.
1.
2.
1.
Bourke Street, c. 1910. Melbourne was becoming a thriving civic centre by the time young George Coles
came to town to further his commercial training... by getting a job! Even as a boy of five or six, George would
venture into the city with his father, in awe of the activity and overjoyed to see the Cole’s Book Arcade (left in
photo). The Cole family was no relation to the Coles family, but were publishers of children’s books that every
child of the time read. Many years later, when the Cole business had run its course, the growing Coles business
acquired the site to obtain a presence in the centre of what would become one of Australia’s busiest cities.
2.
A page from GJ Coles’ travel diary, showing his sketch of the layout of the Johnstone Bros Store in San
Francisco, which sold groceries, household goods and had a bakery section.
Australian retailing, and was determined to learn from the
world’s best before he opened his own doors.
To that end, GJ bought a five-month world tour with ‘Cooks’
for the princely sum of £137 and headed for America. Upon
his arrival in the United States, he called on many businesses
including H. Jevne – the largest grocery store in the world –
where he took copious notes about merchandise layout. He
also visited Johnstone Bros and ‘The Broadway Store’ – the
busiest department store in Los Angeles – where he learnt
about employee training, ethics and record-keeping. In Chicago
he visited Butler Bros General Merchants Wholesalers where he
was impressed by employee facilities, which included lounge
rooms for the 2500 employees, and by their principle of ‘quantity
and quick turnover at a reasonable profit’.
He was particularly impressed by the American self-serve
cafeterias, drawing a half page diagram of a typical layout in his
diary. Some ten years later, that simple sketch would culminate
in the establishment of the first in-store cafeteria in Australia, in
Bourke Street, Melbourne.
While in America, GJ also called on Seigel Cooper, Sears
Roebuck and Marshall Field. Sears claimed to be the largest
commercial institution in the world and one of their policies –
which would later become one of the founding principles of the
Coles business – was the promise of a refund if customers were
not completely satisfied with all purchases.
From there GJ travelled to New York where he attended
a business exhibition of the latest ‘office and time saving
devices’, where he was impressed by ‘a wonderful machine…
the mechanical calculator, which gives out the exact change
required...’ He also took a Sheldon’s business correspondence
course, which required him to forecast his life’s work and explain
how he would achieve it. These questions were critical to him.
His reflections led him to rewrite a paper entitled ‘How I will
run a proposed 5 and 10 cent store in Melbourne’. Sheldon’s
Origins of retailing
The word ‘retailer’ means ‘to cut again’ in
French, and the first retailers were traders
who bought cloth by the roll and cut it
into small pieces. These early retailers
sold cloth and a range of other goods
thousands of years prior to the Coles’
interest in the trade, but they did not
enjoy good reputations. They attempted
to make as much as possible on each sale
and the public had very little confidence in
their mode of operation. Once they began
marking goods with prices in plain figures
and adopting one-price policies, retailers’
reputations improved. This marked the
beginning of department store retailers.
Variety stores followed some time later and
supermarkets later still.
Remember when...
1850s – A gold rush across Victoria and
parts of NSW results in Australia’s first
population boom, and the introduction of
general stores to service the influx.
1856 – Van Diemen’s Land is renamed
Tasmania.
teaching of business ethics ‘on the highest plane’ was also of
vital importance to GJ. He repeated their tenet, ‘there is more
to business than just making money’, over and over again in
his head. After much deliberation he finally concluded what this
‘more’ meant, writing, ‘A proprietor has to have a happy home
life; he has to have a contented staff; he has to have a store he
would be proud of; he has to earn the respect of his fellow men,
and to do all this he must also operate a business that would
be successful…’
‘By the time I’d arrived in Chicago,’ GJ recalls, ‘I’d decided to
open a variety store. I knew that it needed to be an all-cash store
and knew that a housewife needed to be able to get all that she
required for her household – [that number came to] 800 staple
items – and that they needed to be a shilling or under.’
After America, GJ went on to England where he called on many
firms who would one day become regular suppliers. He visited
Marks & Spencer and Woolworths and a number of wholesalers
from whom he bought goods for his planned store. A colleague
had convinced GJ that all successful variety chain stores
carried a full range of crockery, glassware and kitchen goods
at low prices and it was to these departments that customers
were attracted in large numbers. Remembering this, GJ’s first
store in Collingwood would originally carry only 850 items, all
basic necessities, but with a range of choice never before seen
in Australia.
This early overseas study trip would be the first of many made by
Coles people over the ensuing century to ensure the company
would always be equipped with the best ideas and merchandise.
It is a policy that has reaped the company great rewards over its
one hundred years of history.
GJ Coles arrived back in Melbourne on January 25, 1914, his
head reeling with exciting plans. His brother, Jim met him at the
wharf and they immediately went to the Victoria Hotel to discuss
his scheme to open a 3d, 6d and 1/- (threepence, sixpence
and 1 shilling) store in a Melbourne suburb. Equipped with his
overseas education, a broader outlook and some excellent new
supplier relationships, GJ was certain he could be successful;
America and England had shown him more than he had ever
expected to see.
GJ’s employees would be ‘happy and contented’; they would
have rest rooms, participate in training and be encouraged to
continue their education as he had, beyond the confines of
schoolrooms and universities, and they would receive bonuses
in acknowledgment of their efforts. Customers would be treated
with courtesy and given the promise of complete satisfaction
with their purchases or their money back in full. They would
be tempted with appealing window displays and be invited to
rest from their day’s shopping while enjoying the refreshments
offered in modern cafeterias.
With his philosophies refined and his stock purchased, the
foundations of GJ Coles’ successful business had been laid. No
Coles store had yet been opened but its principles of quality,
service and value would become the pillars of a retail empire
unmatched in Australia.
1860s – Explorers regularly set out to find
more arable land to be used for farming
and new settlements for the country’s
growing population.
1870 – Thirty-seven per cent of Australia’s
population now lives in cities.
1878 – The telephone is used for the first
time in Melbourne.
1888 – Celebrations mark one hundred
years of European settlement in Australia.
1890s – Community groups agitate for
change as Australia goes through economic
recession, then matures and prepares for
Federation.
1896 – Edwin Flack wins gold in the
800 and 1500-metre running events and
bronze in the tennis doubles in the first
modern Olympic Games. He is the only
Australian competitor.
1901 – Australia becomes a Federated
nation. Edmund Barton becomes the
first Prime Minister of a country with 3.8
million inhabitants. Melbourne is the seat
of government.
1902 – Australia becomes the second
country (after New Zealand) to grant
women the right to vote.
1911 – The Australian Capital Territory is
established. Canberra is named in 1913.
1913 – Australia’s first Federated currency
note is printed for circulation.
8
Married
GEORGE COLES
Landed in Australia c. 1854
B. 10/07/1832
d. 23/05/1886
SaraH Clipsham
B. 1833
d. 28/09/1892
GEORGE COLES
Married
Elizabeth Scouler
B. 10/06/1855
d. 21/12/1931
B. 27/09/1861
d. 02/12/1900
Sir GEORGE JAMES
THE
B. 28/03/1885
d. 04/12/1977
COLES FAMILY TREE
*
Sir ARTHUR WILLIAM
B. 06/08/1892
d. 23/06/1982
DAVID HENRY
B. 08/09/1894
d. 20/10/1917
JAMES (JIM) SCOULER
B. 01/07/1888
d. 10/08/1916
Sir KENNETH FRANK
B. 19/04/1896
d. 02/04/1985
Sir EDGAR BARTON
B. 03/06/1899
d. 19/02/1981
Married 1902
Ann Cameron
B. 09/12/1863
d. 22/11/1941
The Coles family c. 1900. GJ, the founder of
Coles, is the tall young man in the back row
standing beside his father, George Snr, seated.
*Modified family tree to reflect those directly involved in the Coles business.
Sir NORMAN CAMERON
B. 10/09/1907
D. 24/11/1989
9