Is it time to close Kmart?
The chain is losing money, and sales are sliding. Is there any reason for it to stay in business?
Would Sears be better off closing Kmart? At the rate things are going, the answer is yes.
Kmart is stuck in a rut. Sales at its stores open at least a year fell 3.8% over the crucial holiday shopping season, The Wall Street Journal reports. Now it has just 0.6% of the nongrocery retail market. In the first nine months of its current fiscal year, the chain posted a $98 million operating loss and saw sales slide 5.5%.
We won't know for a while whether Kmart made a profit in 2012, but it lost money on an operating basis in 2011.
The Kmart stores that I've been to are remarkably similar. They're dirty. The shelves are cluttered, yet the customers are gone. Employees are nowhere to be found.
The Journal found a similar scene at a Kmart in Manhattan, where it reported abandoned carts full of merchandise, unevenly stacked towels and unfolded pajama sets lying about. "The tile floors looked as though they hadn't been mopped in some time, and clothes were piled in the corners of the dressing rooms," Dana Mattioli wrote.
Kmart stores in New Jersey took that a step further, selling expired infant formula and over-the-counter drugs. The chain will pay more than $300,000 in fines and be subject to inspections as a result.
Kmart used to fill an important role for budget-conscious shoppers. But those customers have many more places now that can meet their needs. Dollar stores sell groceries and household necessities. Wal-Mart (WMT) has a bigger selection than Kmart, often at lower prices.
In fact, the Journal cited data showing Kmart's prices were higher than Wal-Mart's and Target's (TGT) in five out of six items it checked at all stores.
Granted, that's a pretty small sample. But if that holds true and Kmart isn't necessarily cheaper than competitors, then what is Kmart's reason for existing?
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kMART IN HAZLET, NJ IS JUST FILTHY--TOTALLY DISORGANIZED AND NO EMPLOYEES AROUND TO ASK FOR HELP---SHUT IT DOWN, IT'S A DISGRACE!!!
Price points are higher in K Mart than Walmart, that's a no brainer... I can purchase a comperable or same item at Walmart for less money.. Mens clothing lines in Sears and K Mart are awful, high prices for low quality, very little style.
Change your business practice or else Good Bye K Mart
I don't want them to go away. Prices jumped at Walmart the next town over once that area's Kmart shut its door... heard that from a Wally World employee themselves. If only they could straighten up their act...
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The S&P entered today's session with a week-to-date gain of 1.5% as investors expected reassuring words from today's Federal Open Market Committee Statement.
Stocks traded with slim losses until this afternoon's FOMC Statement and subsequent comments from Chairman Bernanke sent equities and Treasuries to their lows while also providing a significant boost to the dollar.
Today's Statement was ... More
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