Founding; company acquisitions

In 1940, businessman Monte Lafayette Bean arrived in Seattle, Washington, from Portland, Oregon, to take over Tradewell Stores, Inc., a chain of grocery stores.^[3] By 1947, Bean and his son, M. Lamont Bean, opened the first Pay 'n Save drug store at Fourth Avenue and Pike Street in Seattle.^[3]

In March 1959, M. Lamont Bean became the president of Pay 'n Save and began considering operating other stores that were not pharmacies.^[3] Shortly after, Bean began an interest in Ernst Hardware, a local hardware chain owned by Seattle brothers Fred and Charles Ernst.^[3] Fred Ernst agreed to sell Ernst Hardware and its nine locations to Pay 'n Save in February 1960.^[3] In 1962, Pay 'n Save acquired Malmo Nursery and began opening Ernst-Malmo combination stores; combining hardware, lumber, garden supplies, and nursery items in one building.^[3] The first Ernst-Malmo combination store was opened at the University Village shopping center in Seattle.^[3] By 1982, Ernst was operating 68 hardware stores.^[3]

In 1965, Pay 'n Save acquired the Rhodes department stores chain.^[4] Pay 'n Save shuttered the Rhodes flagship store in Seattle during 1968.^[4] The Rhodes name was retired from the suburban branches when M. Lamont Bean renamed the stores Lamonts in 1970.^[4] During 1976, Pay 'n Save acquired discount chains Bi-Mart and Yard Birds.^[5][6]

Death of founder; Trump Group takeover

In October 1982, company founder Monte Lafayette Bean died at age 83.^[3] In 1983, Pay 'n Save entered the wholesale club business and opened the first Price Savers Warehouse in Salt Lake City, Utah.^[3] In December 1983, Pay 'n Save acquired Schuck's Auto Supply, Inc. for about $70 million in Pay 'n Save common stock.^[7] At the time, Schuck's had 58 stores in Washington, Oregon, and Idaho.^[7]

In September 1984, the Pay 'n Save board voted to sell the retailer and to give a lockup option on $4.1 million shares to the Trump Group (no relation to New York real estate developer Donald Trump^[8]) in an effort to stave off other bids.^[2]

Pay 'n Save's largest shareholders, Stuart Sloan and Samuel N. Stroum, vowed to fight the sale of the retail company.^[2] Sloan and Stroum, who owned 18 percent of Pay 'n Save's stock, issued a statement telling shareholders not to "be stampeded into acting hastily".^[2] On September 12, 1984, The Trump Group announced that it had withdrawn its offer to purchase Pay 'n Save in order to negotiate with Sloan and Stroum.^[8] On October 15, 1984, Pay 'n Save was officially sold to the Trumps for $358 million.^[9]

Sale of subsidiaries

The company's sporting goods chain, Sportswest, was spun off in 1984 before being closed completely.^[10] After a brief period, Thrifty Corporation reopened the stores under the Big 5 Sporting Goods name.^[11] Sportswest was the first of several Pay 'n Save division to be sold over the next few years.^[10]

In May 1985, Pay 'n Save announced it would put all its subsidiaries up for sale.^[12] During this time, Dayton-Hudson division Mervyns was expected to acquire the company's 20 Lamonts stores and Southland Corporation, then-owner of 7-Eleven, expressed interest in acquiring all 58 Schuck's Auto Supply stores.^[12] The first subsidiary to be sold was Price Savers Warehouse, in August 1985, to Cincinnati, Ohio-based Kroger.^[13]

On November 1, 1985, Pay 'n Save successfully spun off Bi-Mart, Lamonts, and Schuck's to form a new company, Northern Pacific Corporation.^[14] With all divisions combined, the new company had sales of about $450 million, making it one of the Northwest's largest retail operations.^[14] Just eight days later, Pay 'n Save's flagship drugstore chain became controlled by a company equally owned by the Trump Group and a partnership headed by William Zimmerman, owner of California discount chain Pic 'N' Save.^[15] The sale left Pay 'n Save with 69 Ernst Home Center stores, three Yard Birds stores, and wholesaler Northwestern Drug Co.^[15] By January 1986, Pay 'n Save Corp. was renamed Seattle Standard Corp.^[16]

Return as a public company

After 19 months as a privately held company, Pay 'n Save announced plans to return as a public company in May 1986.^[9] The company planned to sell 3 million shares at from $16 to $18 a share.^[9] As part of the transaction, the company purchased Bi-Mart, a former division of the original Pay 'n Save Corp.^[9] The original company sold its first shares of common stock to the general public in 1962 and reverted to private ownership in October 1984.^[9]

On May 15, 1986, days after announcing plans to go public again, Pay 'n Save announced it would be taking on a new image and announced plans to remodel its 108 stores, which would include a new blue-and-green paint scheme.^[17] The company also announced its new emphasis on bargain goods and plans to raise $225 million by selling convertible bonds and 10-year notes.^[17]

In June 1986, Pic 'N' Save, filed a lawsuit against Pay 'n Save's investment banker, contending that materials outlining Pay 'n Save's stock offering misrepresent the role of Pic 'N' Save's former chairman, William Zimmerman.^[18] When Zimmerman left Pic 'N' Save in August 1984, he agreed not work for a competing company for one year, but the company's interests had been attempting to determine whether Zimmerman violated the agreement.^[18] The suit, filed in state Superior Court in Los Angeles, said that the "Zimmerman merchandising strategy", a key part in Pay 'n Save's business plan, includes Pic 'N' Save trade secrets and other confidential information.^[18] On July 1, 1986, Pic 'N' Save had filed a civil lawsuit against Pay 'n Save, William Zimmerman, and related parties, asking for more than $50 million compensatory damages and $50 million in punitive damages.^[19]

By the end of July 1986, Zimmerman and the Trumps again turned Pay 'n Save into a public company by selling $52 million (~$123 million in 2023) in stock, despite a dramatic decline in sales since they took over.^[20] The company later reported a $12.8 million loss in the first quarter ending August 2.^[20] Mike Reynolds, senior reporter for New York industry publication Chain Drug Review, blamed the company's decline on Zimmerman's approach displaying tables of low-cost imported items.^[20] By December, the company's president, Maynard Jenkins, resigned for a job in California and the company's discounted items would no longer be carried.^[20]

Return to old format

In January 1987, Pay 'n Save reported a loss of nearly $50 million in the last year.^[21] At the time, chief executive Gerald Nathanson said Pay 'n Save management believes a new merchandising strategy and restructuring "will strengthen Pay ' n Save and improve its future performance significantly".^[21] In February 1987, Pay 'n Save announced the closure of all stores in Montana and Wyoming.^[22]

In June 1987, Pay 'n Save revealed its "back to basics" merchandising plan.^[23] The chain planned to revert their 106 drug stores back to the familiar blue-and-green color scheme, complete with new signs, and better lighting.^[23] The company's stores would focus on departments such as candy and snacks, stationery, household chemicals and greeting cards, while the pharmacies would remain the foundation of each store.^[23] The company's remodeling process was blamed for a loss of $9.6 million in the company's third quarter.^[24]

Thrifty Corporation and PayLess Drug

In April 1988, Pay 'n Save was put up for sale.^[11] The sale attracted interest from Thrifty Corporation, who previously acquired Sportswest from Pay 'n Save in 1984.^[11] On May 13, Thrifty announced plans to acquire the company's 110 Pay 'n Save drug stores and 37 Bi-Mart discount stores for stock worth $232 million.^[25] Thrifty also announced plans to keep the Pay 'n Save and Bi-Mart names and the company's current employees.^[25] In the previous year, Pay 'n Save was left with a $27 million loss and a $49 million loss in 1986.^[25]

In August 1988, Gerald Nathanson, Pay 'n Save president and CEO, resigned from the company.^[26] Richard Dortch, who began working with Pay 'n Save as a store clerk in 1969, was elected president of the 124-drugstore chain in January 1991.^[27]

By February 1992, Pay 'n Save was once again for sale.^[28] Days prior to the February 5 announcement, the company announced a loss of $88 million after a $250 million after-tax special charge.^[28] By March, PayLess Drug Stores, a then subsidiary of Kmart, emerged as a possible buyer for some or all Pay 'n Save 125 drugstores.^[29] PayLess officials were not able to comment at the time.^[29]

In June 1992, PayLess Drug Stores officially acquired the money-losing Pay 'n Save drug stores from Thrifty Corporation.^[30] Leonard Green & Partners, a Los Angeles investment firm that specializes in management buyouts agreed to acquire Thrifty Corporation's other division, including Pay 'n Save's Bi-Mart.^[30] Following the sale, the Pay 'n Save stores were renamed PayLess Drug.^[30]

M. Lamont Bean, the company's president from 1959 to 1984, died on February 5, 2004, at age 79.^[3]

Yard Birds

Yard Birds was originally a surplus store started in 1947 in Centralia, Washington. There were also Yard Birds stores in Chehalis, Olympia, and Shelton. While originally selling war surplus, Yard Birds became more of a discount store with many departments, including hardware, toys, shoes and clothing, automotive, pets, sporting goods, furniture, a full-service grocery, and more. Yard Birds stores had a logo that featured a black bird with a yellow beak, reminiscent of the cartoon characters Heckle and Jeckle. In 1987, Seattle Standard sold the chain to its employees through an employee stock ownership plan.^[6] Rich Gillingham, co-founder of Yard Birds, died in 1992.^[6] The company closed one store in 1993 and closed its last two stores in 1995.^[6]

The Chehalis store was converted to a vendor mall and storage space under the Yard Birds name, before closing permanently in 2022.^[41] In 1971, the site became home to a 100 foot (30 metres) statute of a black bird that was large enough for automobiles to drive through. Accidently burned down in 1976, the Yard Birds location added a replacement statue, and smaller works of the same, over the years. The Chehalis store was the focus of a documentary, Skinny and Fatty: The Story of Yard Birds.^[42]