8 min readChapter 1

Origins

The post-World War II era in Italy brought about profound economic and social shifts, setting the stage for the emergence of modern consumer retail. Prior to the mid-1950s, the Italian retail landscape was largely fragmented, dominated by small, specialized shops—botteghe—and open-air markets. Consumers typically purchased groceries from multiple vendors: a baker for bread, a butcher for meat, a greengrocer for produce, and so forth. This traditional model, deeply ingrained in Italian culture, reflected a societal preference for personalized service and locally sourced goods, but it also presented significant inefficiencies in terms of scale, pricing transparency, and consumer convenience. Shopping was a time-consuming affair, often involving multiple stops, interactions with various shopkeepers, and the absence of standardized pricing, where prices could vary based on negotiation or perceived customer status. Furthermore, the limited storage and refrigeration capabilities of small shops often restricted product variety and presented challenges for maintaining consistent quality and hygiene, particularly for perishable goods.

The economic miracle, or boom economico, of the 1950s and 1960s began to transform this environment. Italy experienced remarkable GDP growth, averaging over 5% annually for much of the period, fueled by rapid industrialization and increased productivity in sectors such as manufacturing and automotive. This led to a substantial rise in disposable incomes, a significant acceleration in urbanization rates as people moved from rural areas to cities for work, and profound changes in family structures, including a notable increase in women entering the workforce. These demographic and economic shifts created a burgeoning middle class with less time available for traditional daily shopping rituals and a growing demand for more efficient, convenient, and varied shopping experiences. The rise of new consumer goods industries, from appliances to automobiles, also fostered a broader cultural shift towards modernity and convenience, making the traditional, fragmented retail model increasingly anachronistic for a significant segment of the population.

It was into this evolving context that the vision for a new retail model was introduced, largely inspired by foreign practices. Bernardo Caprotti, a key figure in this development, hailed from a prominent industrial family with a textile background, operating the successful Cotoneificio di Ponte Lambro. This family enterprise, established in the late 19th century, had provided Caprotti with firsthand exposure to industrial-scale production, complex supply chain management, and disciplined financial practices – experiences that would prove invaluable in scaling a retail operation. His personal exposure to American business practices during travels in the early 1950s, particularly the self-service supermarket model prevalent in the United States, proved formative. Caprotti observed how these large-format stores, epitomized by chains like A&P, Safeway, and Kroger, offered a wide array of products under one roof, often at competitive prices, through sophisticated logistics, bulk purchasing from producers, and reduced labor costs associated with self-service checkout systems. He recognized the immense potential for such a model to address the nascent demands of Italian consumers, even if it meant challenging deeply established cultural norms around food shopping, which traditionally prized personal interaction with vendors and the ability to inspect goods closely before purchase. The American model demonstrated that efficiency and variety could coexist, offering a powerful alternative to Italy's fragmented retail landscape.

The initial impetus for Esselunga's founding was a partnership that skillfully brought together American capital and retail expertise with Italian entrepreneurial drive. In 1957, Bernardo Caprotti, alongside his brothers Guido and Claudio, collaborated with Nelson Rockefeller's International Basic Economy Corporation (IBEC) and other Italian partners, notably La Centrale, a prominent financial holding company with interests across various industrial sectors. IBEC, founded in 1947, had a mission to foster economic development in various countries by introducing modern business techniques, particularly in areas like food distribution, housing, and agricultural production, leveraging American know-how. Its involvement in Supermarkets Italiani underscored the perceived novelty and significant potential of large-scale, modern retail in post-war Italy, providing crucial seed capital, technical know-how, and a blueprint for operational efficiency drawn from successful American ventures. The collaboration resulted in the formal establishment of Supermarkets Italiani S.p.A. on November 13, 1957. The initial capital investment was substantial for the time, reportedly around 1.5 billion lire (approximately $2.4 million USD at the prevailing exchange rates), reflecting the significant infrastructural costs involved in establishing such a pioneering venture. The ownership structure initially saw a blend of Italian and American interests, with Caprotti's family and La Centrale representing the Italian side, ensuring both local market understanding and financial backing.

The business concept was straightforward yet profoundly revolutionary for Italy: to establish a chain of self-service supermarkets offering a broad selection of food and non-food items, emphasizing convenience, value, and consistent quality. This approach necessitated significant investment in a new kind of retail infrastructure, including larger store formats (typically over 500 square meters, a considerable size for the era), sophisticated inventory management systems, and a novel supply chain model capable of supporting centralized purchasing and distribution. Unlike the traditional system where each small shop procured goods independently from local suppliers or wholesalers, Supermarkets Italiani aimed for direct sourcing from producers, consolidation at central warehouses, and efficient, refrigerated distribution to stores. This dramatically reduced the number of intermediaries, allowing for better quality control, reduced waste, and significant cost savings that could be passed on to consumers. The value proposition was clear: to save consumers time and money by providing a comprehensive shopping destination with transparent, fixed pricing – a stark contrast to the often opaque, negotiable pricing structures of traditional markets, which could vary widely based on negotiation or perceived customer relationship. The introduction of fixed prices eliminated haggling, a common practice in botteghe and markets, thereby promoting fairness and simplifying the shopping experience. Furthermore, the standardized packaging and consistent availability of goods marked a significant departure from the often unpredictable offerings of smaller, localized vendors.

Early challenges were considerable and multifaceted. Introducing the self-service concept to Italian consumers required overcoming deeply ingrained habits and a significant degree of cultural resistance. Italians were accustomed to a highly personalized shopping experience, where shopkeepers offered advice, served customers directly, and often extended credit based on personal relationships. The idea of selecting one's own goods, pushing a shopping cart (a novel item itself), and queuing at a checkout counter, rather than relying on a trusted shopkeeper's assistance, was initially unfamiliar and even viewed with suspicion by some segments of the population who equated self-service with lower quality or a lack of care. Logistically, sourcing a consistent supply of quality produce and packaged goods for a larger format store also presented substantial hurdles in a country where agricultural supply chains were fragmented, often localized, and lacked standardized grading systems or modern cold chain infrastructure. Building relationships with numerous small and medium-sized producers and integrating them into a centralized distribution network required immense effort, investment in logistics, and the establishment of new quality control protocols. Furthermore, securing suitable large retail spaces in dense urban centers, which were not designed for such establishments and often lacked adequate parking facilities, posed significant planning and financial obstacles. The regulatory environment, accustomed to small-scale commerce, also required careful navigation, particularly concerning zoning laws, trade licenses, and potential opposition from established small retailers lobbying against the emergence of larger competitors.

Despite these complexities, the founders moved forward with conviction and meticulous preparation. Bernardo Caprotti, leveraging his family's industrial background and his own burgeoning business acumen, played a critical role in shaping the operational philosophy and strategic direction of the new venture. His dedication to efficiency, consistent quality, and a customer-centric approach, combined with the initial capital injection and operational guidance from IBEC, laid the essential groundwork. The preparatory phase involved extensive market research, studying international best practices in store layout, product assortment, and logistics, and adapting them carefully to the unique Italian context. This included decisions on refrigeration technologies for fresh produce, efficient shelving systems for maximizing product visibility, and the design of the shopping cart itself, which was a wholly new item for Italian shoppers. Meticulous planning extended to pricing strategies, aiming for competitive value without compromising on the perception of quality. The selection of the first store location was paramount, settling on Viale Regina Giovanna in Milan, a then-modern urban area with good accessibility and a nascent middle-class population perceived as being eager for convenience and modernity. This location was chosen not only for its demographic potential but also to serve as a high-visibility proof-of-concept. Initial staff recruitment and rigorous training were also crucial, preparing employees not just for new tasks like stocking shelves and operating cash registers, but also for patiently educating customers on the self-service model. By late 1957, after months of intensive planning and significant investment, Supermarkets Italiani S.p.A. was officially established, poised to open its doors on November 27, 1957, and embark on a pioneering journey in Italian retail history, aiming to redefine how Italians shopped for their everyday needs and marking the birth of what would become Esselunga.