New York Times obit:
Harry Cunningham, 85, Pioneer And Developer of Kmart, Is DeadBy DEAN BAQUET
Published: Friday, November 13, 1992
Harry B. Cunningham, who pioneered discount mass-merchandising in transforming Kmart Corporation into a retailing giant, died Wednesday night at his home in North Palm Beach, Fla. He was 85 years old.
He died in his sleep, the company said.
Mr. Cunningham displayed his early knack for retailing in 1951, when, as sales director of the S.S. Kresge Company, he proposed that the variety store chain start using the same checkout system that was winning popularity in supermarkets.
Six years later, Frank Williams, then the company's president, decided to free Mr. Cunningham from the grind of daily operations, and sent him off to scout new strategies for the company's future.
For the next two years, Mr. Cunningham studied a variety of operations around the country, looking for ways to expand what had become a stagnant business. Kresge, founded in 1899, was then a chain of so-called five and dimes, relatively small, sparsely furnished stores that sold small, inexpensive items. Larger Stores
Mr. Cunningham and an aide visited most of the Kresge stores, as well as those of the competition. Particularly intriguing to him was a new discounting operation in Garden City, L.I., called E. J. Korvette.
Mr. Cunningham came back from his explorations convinced that discounting -- low prices and margins, high-volume turnover in much larger stores -- was the way of the future. His recommendation: the old Kresge variety stores, with 4,000 to 6,000 square feet of space, were not nearly big enough. An entirely new operation had to be conceived to sell a wide variety of household items at discount, not just the few staples of the variety stores.
"He set the pace," said Kurt Barnard, former head of the National Mass Retailing Institute, now known as the International Mass Retailing Association. "Kresge's business was not growing. He perceived that the five and dime industry was going to decline. He was one of the pioneers."
By Mr. Barnard's account, other businesses were moving into discount stores. But Mr. Cunningham dramatically altered the industry by pushing Kresge, with its vast resources, into the business.
"To his great credit, he recognized the incredibly enormous potential of pushing such a big company into mass discounting," he said.
In 1959 Mr. Cunningham was elected company president. And in 1961 he started a new retail division that in 1962 built the first Kmart discount department store.
Under Mr. Cunningham's direction, the first stores typically sprawled for 75,000 square feet on one floor. They were situated in the suburbs, amid heavy traffic, and included ample parking space.
In 1991 Kmart sales totaled $35 billion. There are now 4,000 Kmart-owned stores in all 50 states, as well as Puerto Rico, Australia, Canada, and Czechoslovakia.
In his best-selling autobiography, another discounting pioneer, Sam Walton, founder of Wal-Mart, paid homage to Mr. Cunningham.
Mr. Walton wrote, "Wal-Mart wouldn't be what it is today without a host of fine competitors, most especially Harry Cunningham of Kmart, who really designed and built the first discount store as we know it today, and who, in my opinion, should be remembered as one of the leading retailers of all time." Management Training
Mr. Cunningham became chairman of the board in 1967. He held the two most powerful positions at the company -- chairman and president -- until 1970, when he resigned as president. He gave up the chairmanship in 1972, remaining a director and a member of various board committees.
Mr. Cunningham was born on a farm in Home Camp, Pa. He left Miami University in Oxford, Ohio, after his sophomore year to take a job as a reporter at the Harrisburg Patriot. A year later he started out in Kmart's management training program in Lynchburgh, Va. He became a store manager in 1940, and a district manager in 1947.
He is survived by his wife, the former Margaret Diefendorf; three daughters, Jane Herrington, Sally Downey and Ann Glime; a brother, Norman; three sisters, Virginia, Mabel Graham and Nellie Kauffman; and grandchildren.