Zahn's Department Store was established in 1898 by Edward Zahn. Born on April 3, 1865 in the village of Vienna, Wisconsin, Zahn was the son of a German miller who had immigrated to the United States in 1841 and had settled in Vienna in 1845. At the age of fifteen Edward Zahn moved to the city of Racine, where he found work as a clerk in the store of Joseph Schroeder. At Schroeder's, Zahn advanced from working the five-cent counter to being the buyer of silk thread and twist, and eventually headed each of the store's departments. In 1895 he married Hattie Easson, the daughter of Racine pioneer Captain James Easson. The couple had two sons, Edward James, born in 1896, and Russell Victor, born in 1901. The sons eventually joined in their father's business and continued its operation after his death in 1930.
Edward Zahn opened Zahn's Dry Goods Company on September 15, 1898. Located on Racine's Main Street, Zahn's began business with 8,000 dollars in capital and 3 clerks. Zahn soon added a second floor to his store and increased the quality and variety of his stock. In 1916 the store relocated to a double two-story building on South Main Street, and six years later Zahn acquired a second building. Finally, on October 6, 1925, Zahn's moved to its last location, 506-508 Monument Square.
The store's proprietors took a sophisticated approach to marketing. During the 1920's they published a monthly advertising brochure titled Zahnettes, and here they highlighted seasonal fashions, accessories, and other merchandise. In the late 1920's and 1930's the store used scientific merchandising studies and market research combined with direct-mail promotions. From 1929 through 1931 Zahn's contracted with the John Service, Inc. of New York. This marketing firm analyzed groups of the store's account customers and mailed to customers personalized letters. In the years 1934-1936 Zahn's participated in retail marketing studies conducted by the University of Michigan's Bureau of Business Research. The Bureau had begun collecting data on department store merchandising in 1926. Researchers used these statistics to establish standards of departmental performance with respect to relative sales volume, mark-ups, and discounts. Zahn's, as one of a group of non-competing, independently owned stores, submitted to the Bureau monthly departmental statistics. In return the Bureau sent each participating store a monthly report of the group's merchandising figures. All of these sophisticated tactics helped to boost sales and to make Zahn's one of the leading merchandisers in Racine.
By 1950 Zahn's employed 160 people and was reported to be the largest retail operation in Racine County. But by 1960, due to increased competition from Racine, Milwaukee, and outlaying areas, the store's business began to decline and its staff was reduced to 116. Zahn's closed its doors in April, 1982.
