Beginning in 1792 as a single shop in London selling newspapers, the firm begun by William Henry Smith has grown today into a corporation embracing a host of businesses in travel, DIY, music, cafés, and on-line retail, both in Britain and overseas. With 615 shops, and 713 travel agencies operating under the W.H. Smith name, the firm has revenues of over a billion pounds and returns around £100 million in profits every year. A big impetus for their growth was the development of the railway network, which they exploited by opening newspaper-kiosks in many stations. When they lost that contract, they moved into the streets nearby, establishing their presence in every town. The family, with a succession of ‘William Henry Smith’ chairmen, kept control through several re-organizations of the firm until 1972, since when it has been run as a major public corporation.
- Began in 1792 as a single newspaper shop in London
- Used the expansion of railways to develop a chain of outlets in stations
- Remained under Smith family control until 1972
- Developed the first ISBN system
By the early 18th century, newspapers were beginning to multiply in England. The restrictions of the century before had passed, and the hunger for news had grown. Daniel Defoe and Jonathan Swift were the first famous journalists (and authors to of course), and through the century more papers began to appear. There were 53 different newspapers in London alone by 1776; The Observer, the world’s first Sunday paper began in 1791; and the government had developed a tax system to collect revenue on their sale, increasing the cost and in a round-about way therefore also increasing the quality. Papers were sold on street corners, as they still are today, but to offer a full range, shops selling them – news vendors – later to be called newsagents, developed. These sold not only newspapers but other publications that came out regularly, of which there would soon be around 100 titles.
So when, in 1792, Henry Walton Smith and his wife Anna opened a news vendors shop on Little Grosvenor Street, London, they would have been joining numerous other similar businesses. By August of the same year, Henry died, leaving Anna to run the business. She took on a partner, Zaccheus Coates, who died in 1812. When Anna too died, a few years later in 1816, her two sons, Henry Edward and William Henry, inherited equal shares in the business. William Henry, although the younger son, had more inclination towards business, and in 1828 he renamed the shop W.H. Smith. When, in turn, his only son became a partner in 1846, aged 21, they became, not unreasonably, W.H. Smith & Son.
The middle decades of the 19th century were the great age of railways, with train travel replacing waggons and canal boats. When the thrill of travelling at speeds once thought to be instantly lethal wore off, travellers needed something to do, and reading was an obvious choice. Realizing this, in 1846 W.H. Smith opened a news-stand inside Euston station, been built in 1837 for the London to Birmingham railway line. The stand was successful, more stands followed, and by 1850 they were the top newspaper distributor in the country. They developed wholesale distribution warehouses in Birmingham, Manchester and Liverpool. They also opened in Dublin, and from these warehouses, they ran an extensive network of retail outlets for newspapers and books, including the popular cheap paperbacks of the time, called ‘yellowbacks’.
In 1865 the elder William Henry died, leaving the business in the hands of his son. The younger William Henry Smith had been educated at grammar school, and in the English tradition had now risen significantly through the social ranks from his grandfather’s humble beginnings in the Somerset village of Wrington. A useful way to ascend further was through politics, and he was by then able to finance his campaigns himself. He took a partner into the firm, the barrister William Lethbridge, so as to free himself for the political life. Smith became an MP in 1868 as a Conservative, after an earlier attempt to run on a more Liberal platform had failed. When Disraeli became Prime Minister in 1874, he appointed Smith to the junior position of Financial Secretary to the Treasury. H acquitted himself well, and by 1877 he had the much more senior position of First Lord of the Admiralty.
Some have claimed that Smith inspired Gilbert and Sullivan to create the character of Sir Joseph Porter, in their 1878 comic opera, H. M. S. Pinafore. This may have sprung more from the initials of the name than reality, as Gilbert himself denied any similarity in a letter to Sullivan. Any slur certainly did not harm his political career, as for the remaining years of his life – he died in 1891 – he was, successively, Chief Secretary for Ireland, Secretary of State for War twice, First Lord of the Treasury, Leader of the House of Commons, and just before his death, Lord Warden of the Cinque Ports.
He died too early to be elevated to the peerage, so the honour went to his wife, who a month after his death was made Viscountess Hambleden, of Hambleden in the County of Buckingham. The title still exists today. Her son, Frederick, inherited the title when she died in 1913 and became an army Colonel after WWI. His son, another William Henry, became actively involved in the management of W.H. Smith after his father’s death in 1928. He turned it into a limited company, with himself as the only shareholder, as a stratagem to escape the large death-duties owed on his father’s estate.
While all this was happening, the firm continued to prosper and expand. In 1860 they had opened private lending libraries, which continued until 1961. As part of the improvements in work conditions that spread through England towards the end of the 19th century, W.H. Smith brought in a pension fund for their clerical staff in 1894, and for the manual workers in 1895. In 1903 they opened their first overseas branch, in Paris, but the following year they were forced to close most of their railway bookstores. This was due to a contract dispute, but undeterred, they opened 150 shops as close as possible to the railway stations. This necessitated developing their own shopfitters department, which was followed in 1911 by a Publicity department.
During WWI, more than 4,000 employees signed up. Involvement in the war effort led to them turning their headquarters, Strand House, which was on Portugal Street, into the Censor’s office for the military. After the war, they opened a shop in Brussels, and then acquired the rival firm of Truslove & Hanson in London. WWII saw 5,000 workers serve in the army, and when the Blitz destroyed the bookshops, mobile ones were developed, so that the books and papers were still available to the population. Right after the war another acquisition, of Sherratt & Hughes bookshops, expanded the chain even further.
In 1948, the last William Henry died, leaving the firm again with an enormous bill for death duties. This time the family went public, becoming W.H. Smith & Son, Limited. That firm was held by a holding company of the same name, with family members and senior staff holding many shares, as well as the public offering. David Smith, William Henry’s brother, became Governing Director and then Chairman of the holding company. In 1950 the first branches in Canada opened, and through the middle of the 20th century, further acquisitions took place. In 1966, in association with the American publisher Doubleday, they created Book Club Associates, which was for a time Britain’s largest book club operator.
In 1966, wanting to improve their book reference system W. H. Smith developed a 9-digit code that gave a unique reference to every book. This was called Standard Book Numbering or SBN. So valuable was this idea that by 1970 it became the international standard. In 1974 it became the ISBN numbering used universally today – perhaps their most enduring achievement.
David Smith remained in the chair until 1972, but his death in that year saw the first non-family member, C.H.W. Troughton, become chairman. The family had little control in the company from then on, and in 1996 the last Smith left the board of directors. From this point on the kind of diversification that was such a feature of businesses during those decades began. In 1973 they opened their first Travel Agency, and in 1979, following the acquisition of lCP Homecentres, W.H. Smith Do It All was born. The Hornsby family had been vice-chairmen at the firm since 1922, and in 1982 Simon Hornsby, the grandson of the original vice-chairman became the head of the company. In 1983 W.H. Smith entered the new cable and satellite TV industry, with a sports channel – Screensport – opening in 1984 and their Lifestyle channel starting the following year.
Further expansions followed, with the creation of Waterstone’s in the USA in 1991, and moved into the music business via a 50% share in Virgin Retail Ltd., plus the ownership of Record World, and other chains. In 1995 they went into online retail and then went through complex divestments, acquisitions, mergers and consolidations. The business continued to expand and diversify as it entered the 21st century, adding stationary stores and cafés to its activities. Following the privatization of the Post Office, it has also begun to operate a chain of private post offices. The latest venture is a franchise for small local newspapers, which in a way closes the circle with their origins as that sole newspaper shop in Little Grosvenor Street.
Sites to Visit
- Every English High Street is today populated by numerous stores, including W.H. Smith stores themselves, but also with a host of other chains owned by the corporate giant.
- The founder, William Henry Smith, is buried in Kensal Green Cemetery, London.