Creating Mass Markets: Mass Distribution
The railroad industry required standardized, mass-produced parts for its daily operations, particularly as the lines grew and merged with one another. For example, the Baldwin Locomotive Works in Philadelphia, one of the largest manufacturers of locomotives in the world, was producing nearly a thousand locomotives annually by the late 1800s. The interior of the company’s erecting shop covered an entire block and stood forty-two feet high, housing nineteen tracks with four locomotives each.31 Other companies also manufactured thousands of specialized standard parts necessary for railroad operations—tires, water injectors, signal oils, hydraulic pumps, ticket punches, or barbed wire to protect livestock from oncoming trains.
Through the wide distribution of agricultural products, raw manufacturing materials, and finished consumer goods from other industries, the railroads fostered mass production and opened new national markets. A company could create a mass-produced product—whether sewing machines or plows—in one region of the country and transport it via rail for sale in another region. The speed, efficiency, and scale with which items were produced and shipped resulted in lower costs. The ability to distribute grains and livestock efficiently also inspired a growing agricultural commodities market that the United States increasingly relied on to feed its cities and outlying areas. Centrally located, Chicago developed into a commodity hub where wheat, corn, oats, cattle, and pigs were bought and sold and where related industries such as grain storage, slaughterhouses, and meat processing developed.
A new class of salesmen who traveled by rail promoted various products and brought back useful information about supply and demand for goods to their employers. Guides to aid salesmen on their routes included detailed information on the demographics of nearby cities and towns.32 By the 1850s and 60s, the systems of mass production, transportation, telegraph communication, and corporate organizational structure created fertile ground for large-scale wholesalers and retailers. Mail-order stores like Sears, Roebuck and Company could offer reduced prices because, as the Sears catalogue explained, “We are Able by Reason of Our Enormous Output of Goods to make contracts with representative manufacturers and importers for such large quantities of merchandise that we can secure the lowest possible prices.”33 Chain and department stores including Woolworth’s, Macy’s, Montgomery Ward, Marshall Field’s, and B. Altman also made their appearance in the American landscape.
