Rexall Drug and Chemical Company
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Product Details
Rexall Drug and Chemical Company
Certificate Type
Capital Stock
Date Issued
May 14, 1964
Canceled
Yes
Printer
American Bank Note Company
Signatures
Machine printed
Approximate Size
12" (w) by 8" (h)
Additional Details
NA
Historical Context
Rexall was the brainchild of Louis Kroh Liggett, a Detroit patent medicine salesman who created a manufacturing cooperative for franchised drugstores at the turn of the 20th century. Liggett's marketing genius enabled independent druggists to profit from enhanced store and product identity combined with national advertising. While the cooperative venture endured for decades, the brand name survived even longer. Today, many bright orange and blue Rexall Drug signs remain on buildings across the U.S. because of their iconic appeal.
In 1898, 23-year old Liggett was working out of Boston, Massachusetts, urging the retail drug trade to sell a bottled tonic called "Vinol" made from wine and cod livers. The nostrum had been sold on the open market with only fair success until Liggett fielded the idea for a limited franchise plan that would help eliminate the self-destructive practice of price cutting. Approaching the leading druggist in each town, Liggett offered an agency contract for Vinol. In return, the drugstore would enjoy company sponsored local and national advertising as well as a monopoly on repeat sales in his area. The plan was well received and proved to be a winner.
As Vinol sales soared, instilling confidence in the new method of distribution, Liggett proposed forming an organization to manufacture and distribute a broader range of products. Each shareholder would participate in profitability, both from the manufacturing division as well as retail sales. Discussions centered around formulating drug items from quality materials, labeling with a uniform trade-name, and selling under a “money-back” guarantee. The products would be sold to stockholders at a modest advance over cost that included ample margin to secure advertising. Liggett was encouraged by the responsive chord he struck in the minds of druggists he surveyed, and his new cooperative plan was soon presented for capitalization.
In the fall of 1902, a group of drugstore owners and other investors met in Chicago. Forty of them, including Liggett, agreed to purchase stock in the amount of $4,000, creating $160,000 capital to launch the new company. The organization was chartered as United Drug Company, and “Rexall,” signifying “King of all,” was registered as the primary trademark. A small factory building in the Roxbury district of Boston was leased, production and printing machinery installed, and amazingly, the first orders of Rexall proprietary medicines were shipped in mid-March 1903.
A candy making department was the next installation, followed by one for perfumery in 1905. Stationery and fountain supplies were added in 1910, rubber goods in 1912, brushes in 1913 and hospital items in 1919. Following World War I, sales greatly exceeded the Boston plant’s production capacity, leading to construction of new factories in St. Louis, Missouri that were opened in 1920. That same year United Drug Company expanded their business in the United Kingdom by purchasing Boots Pure Drug Co., Ltd. for $10 million. With laboratories and main offices in Nottingham, the deal also included 627 “Boot’s Cash Chemists” shops and four manufacturing plants in England and Scotland. Ownership of these stores and factories continued until 1933 when British interests repurchased the Boots stock for $32 million.
Rexall’s version of the "One Cent Sale" (two items for the price of one, plus 1 cent) was introduced nationally in 1915 (see more here); and by late 1920 the number of Rexall agents worldwide reached 10,000. The famous One Cent Sales and other unique promotions helped the company and most of the franchised dealers survive the depressed economy during World War I and throughout the 1930’s.
Justin Whitlock Dart became president of United Drug Company in 1943. Within four years he moved headquarters from Boston to Los Angeles and altered the corporate name to Rexall Drug Company. His plan embraced three far-reaching objectives: modernized packaging, improved Rexall store and product identification, and augmented national advertising. Rexall-sponsored radio shows such as Jimmy Durante, Amos 'n' Andy, and Phil Harris & Alice Faye, along with television specials and full-page magazine and newspaper ads contributed greatly to Rexall achieving immense popularity and patronage. The hearty greeting, “Good Health to all From Rexall” was a standard on radio and TV programs. All points of Dart's plan were gradually achieved and “Rexall” became a household word that equaled “drugstore” in common usage.
In the 1950's many large companies began to diversify with the growing economy, and Rexall Drug was no exception. Primary acquisitions were in chemicals and plastics, including the purchase of Tupper Corp. in 1958 for $16 million. A corporate name change to Rexall Drug and Chemical Company took place in 1959, and expanding interests prompted yet another metamorphosis ten years later to Dart Industries, with Rexall Drug Company organized as a division.
In 1977, Dart Industries sold Rexall Drug Company to a group of private investors that eventually eliminated the franchised dealerships. Rexall products were promoted to a larger market, including super drugstore chains, and the original character of the Rexall manufacturing/distribution system vanished. The drastic change in marketing policy didn’t last long. By 1986 the Rexall Corp. factory in St Louis closed and remaining assets were sold to an investment group in Ft. Lauderdale, Florida that specialized in vitamin supplements.
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