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?

By Kim Peterson Jan 24, 2013 6:28PM
Pedestrians pass a Kmart location in New York ( Frank Franklin II/AP Photo)Sears Holdings (SHLD) is trying to fix its operations and has made some progress along the way. But the company is being dragged down by Kmart, raising questions about whether that discount chain's time has come and gone.

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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793Comments
Jan 24, 2013 11:22PM
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IT'S very simple: Train the managers, give them the tools they need, If they can't or wont manage,

Get someone else.  When I had a job, if I didn't do it One day, the next day I didn't have to worry

about working the next day: I would not be working there. Upper level management didn't do this !!

Jan 24, 2013 11:15PM
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HOW COME WE NEVER HERE BAD ABOUT TARGET , KMART.COSCO ? JUST WALMART.EVERYONE IS SILENT ABOUT THESE OTHERS BUT BEATS UP THE GUY THAT SAVES THEM THE MOST.ALL THESE STORES PAY THE SAME WAGE.HAVE THE SAME MED COVERAGE.WORK THE SAME HOURS .
Jan 24, 2013 11:15PM
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KMart  Needs new management stop being so high on products ,Personal to stop being so stuck up. Be more friendly.
Jan 24, 2013 11:14PM
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It's been a long time coming. Just look at K-mart locations and facilities. They're awful, and in many towns, not even on the side of town where one finds retail growth and traffic, but in older parts of town. When sales go south, the first thing that gets cut is hours, meaning less staffing and more grumbling by those who remain. Actually the same thing happens in Walmart and Target. K-Marts are in a shambles, but in spite of that, some brilliant "turnaround" expert believes he can turn them around. Sears Holdings should take their losses and close K-Mart..
Jan 24, 2013 11:09PM
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How about just calling them SEARS??
Jan 24, 2013 11:08PM
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kmart ceo and board members just knows how to run a company to the ground while getting overpaid to do it
Bet that when K-mart goes under the ceo and all his cronies will take big bonuses.
Jan 24, 2013 11:07PM
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the bottom line; if a business is NOT competitive, their OUT!!...it doesn't take a rocket scientist to figure that one out, Mr CEO.............
Jan 24, 2013 11:06PM
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wish someone would stop walmart, as a 9 year employee of that hole and a manager the things i was told to do are simply criminal walmart is getting away with murder, im surprised kmart is still going, but i truly hope kmart and sears survive, because once the competition is gone walmarts prices will go up higher than. 
Jan 24, 2013 11:05PM
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The Kmart in Calhoun Georgia is a clean store with a very helpful staff but their prices are higher than Walmart. Sometimes it's worth it just to not have to deal with all of the crowds at Walmart though ! I hope they don't close this one !
Jan 24, 2013 11:03PM
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For one thing. For it to be a discount store it sure is expensive, and every time you go in there it's only 2 or 3 people working. No one in the store is there to help you, because they are either at the resister, in the customer service booth or stoking the selves. Kmart wake up!!! Discount means discount. You will sell more by pricing it for less and not just 2 or 3 penny's. You get it in bulk so I know you are not paying that much for it, and selling items at a 200% mark up. Not good in this economy, people are just trying to make it and all you people are worried about is making a profit.

Jan 24, 2013 11:01PM
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Even the stores like this Die after the new wears off K-Mart can thank Wal-Mart for the death blow !

AND THEY BOTH ARE KILLING SMALL GUYS ON MAIN STREET !

AND HAVE RUINED RETAIL FOR ANY ONE TRYING TO SURVIVE !  

Jan 24, 2013 11:00PM
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Kmart is an American Tradition.  Too many of the familiar stores are closing to be either never replaced or replaced by something that sells garbage for a dollar.It is one of the places that sells clothes for people who are on that sort of budget.  Durable, lasting for the most part.  It sells furniture and appliances and it has Lay A Way.  A place where people can get that couch or fridge or air conditioner without paying high interest rates and still have time payments.  Should it close?  No, it is a necessary form of capitalism that allows the common Joe a place to do business that they can better afford.
Jan 24, 2013 10:57PM
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They try to run it in the ground, funny they have something on sale and the kids they hire, ring it up and it comes up about $20.00 less than the sale. No one says a word, happened to me twice in a few months.

Jan 24, 2013 10:57PM
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YES THE K MART STORE IN OUR AREA, HAS BEEN STRUGGLING 
WITH SALES. I THINK ITS A MATTER OF TIME  .
 

Jan 24, 2013 10:57PM
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Ok so close the Kmarts and the Sears and what do you left Wal Mart and Target... No thanks. 

Sears corporation needs the merge Sears and Kmart and give Wal Mart a run for the money. How can Sears do this? Simply Wal Mart doesn't sell appliances, good hand tools, and a lot of the things Sears sell.

 

Jan 24, 2013 10:56PM
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k mart messed up sears when they brought sears out
Jan 24, 2013 10:53PM
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attn america: it`s time to close everything except wal-mart because they`ve crushed eveybody with their corporate might!!!!
Jan 24, 2013 10:52PM
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i quit shopin at kmart because of very poor service including long lines atthe check out with only one open n a dozzen or so poeple in line wwith other cashiers standing around no prices on idems shelves empty now some wallmarts doin the same
Jan 24, 2013 10:50PM
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Sears fired my wife unfairly back around 2005 over one missed day that she thought she had off. She was a good worker that sold appliances for them and always made her commission goals. We haven't been back since and we told all our family members about it and hopefully that will sway them from ever going back. They're getting what they deserve.
Jan 24, 2013 10:49PM
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Sears has been wanting to sell off Sears/Kmart BOTH and live off the core brands selling them in other stores... the problem is they haven't found a way to do that. Sears and even Kmart feels like going back in time... They should kill Kmart and then really severely turn around Sears. I would recommend a hip attitude/modern attitude throughout the store. You need to look at the competition and make an assessment. JCPenney is doing this...but they are late. I see what Walgreen's is doing to it's stores... i would march the CEO of SEARS holdings in there and go: LOOK!
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