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Kmart |
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This article needs additional citations for verification. Please help improve this article by adding reliable references. Unsourced material may be challenged and removed. (April 2007) |
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| Type | Subsidiary of Sears Holdings Corporation |
|---|---|
| Founded | 1899 as the S. S. Kresge Company (Detroit, Michigan), 1962 as Kmart |
| Headquarters | Hoffman Estates, Illinois, USA |
| Industry | Retail |
| Products | Clothing, Bedding, Furniture, Jewelry, Health and Beauty Products, Housewares, Tools and Hardware, Sporting Goods, Electronics, Toys and Games, and Baby Products. |
Kmart (sometimes spelled as "K-Mart") is a chain of department stores in the United States, Puerto Rico, the U.S. Virgin Islands, and Guam. The chain merged with Sears in 2005, creating the Sears Holdings Corporation. Kmart also exists in Australia and New Zealand (see Kmart Australia), although it now has no relation to the American stores except in name after US equity in the Australian business was purchased in the late 1970s. It is the third largest discount store chain in the world, behind Wal-Mart and Target.
As of January 28, 2006, Kmart operated a total of 1,416 Kmart stores across 49 states, Guam, Puerto Rico, and the U.S. Virgin Islands. This store count included 1,361 discount stores, averaging 92,000 square feet, and 55 Super Centers, averaging 165,000 square feet.1.
Kmart's world headquarters were located in Troy, Michigan, in a sprawling complex which, since Kmart's relocation to Illinois, has been slated for demolition 2.
Kmart became known for its "Blue Light Specials." They occurred at surprise moments when a store worker would light up a mobile police light and offer a discount in a specific department of the store. At the height of Kmart's popularity, the phrase "attention Kmart shoppers" also entered into the American pop psyche, appearing in films and other media such as Rain Man, Troop Beverly Hills and Beetlejuice.
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Please help improve this section by expanding itwith: more info about the founding of S. S. Kresge Co.. Further information might be found on the talk page. (August 2008) |
Sebastian S. Kresge, who had previously founded the S. S. Kresge dime store chain, opened the first Kmart store on March 1, 1962, in Garden City, Michigan3 and named Kmart after himself; this store is still in operation to this day. A total of eighteen Kmart stores opened that year. Kmart Foods, a now defunct chain of Kmart supermarkets, opened in that same decade.
During the 1970s, Kmart put a number of competing retailers out of business. In 1977, S. S. Kresge Corporation changed its name to Kmart Corporation. In 1987, the Kmart Corporation sold its remaining Kresge and Jupiter stores in the United States to McCrory Stores, although Canadian Kresge stores continued to operate until 1994.
During the 1980s, the company's fortunes began to change; many of Kmart's stores were considered to be outdated and in decaying condition. In the late 1980s and into the 1990s, the corporate office shifted much of its focus from the Kmart stores to other companies it had acquired or created, such as The Sports Authority, Builders Square, and Waldenbooks.
In 1990, in an effort to change its image, Kmart introduced a new logo (dropping the old-style italic "K" with a turquoise "mart," created 1962), and renovated many stores. (This logo forms part of the "Big Kmart" logo pictured below.) However, most stores were not remodeled until the mid-1990s, and some have not been completely renovated to this day. This logo was replaced in 2004 with the current logo. In the early 1990s, Kmart also tried to reinvent itself by using the short-lived Today's Kmart name.
The company also began to offer exclusive merchandise by Martha Stewart, Kathy Ireland, and Jaclyn Smith. Other recognizable brands included Sesame Street and Disney. Rosie O'Donnell and Penny Marshall were among the company's most recognized spokespersons.
Kmart opened its first 147,000-square-foot (13,700 m2) Super Kmart4 in 1991 in Medina, Ohio. The second Super Kmart opened in Montrose, Ohio, but is now closed. Kmart also opened the first Big Kmart in Chicago, Illinois, on April 23, 1997. Some Kmart stores were converted to the Super Kmart concept, but most were converted to the Big Kmart concept, possibly because it was less reminiscent of Wal-Mart's Supercenter concept.
The original Blue Light Special disappeared in 19915, due to changing consumer habits and misuse by individual stores (according to the company's official explanation). The company brought back the Blue Light Special in the early 2000s, but within a few weeks the program was scrapped.
In 1994, Kmart closed 110 stores. Unlike its competitors Wal-Mart and Target, it had failed to invest in computer technology to manage its supply chain. Furthermore, Kmart maintained a high dividend, which reduced the amount of money available for improving its stores. Many business analysts also faulted the corporation for failing to create a coherent brand image.
On January 22, 2002, Kmart filed for Chapter 11 bankruptcy protection under the leadership of its then-chairman Chuck Conaway and president Mark Schwartz. Conaway, who had had success building up the CVS Corporation, had accepted an offer to take the helm at Kmart along with a loan of some $5 million. In a scandal similar to that involving Enron, Conaway and Schwartz were accused of misleading shareholders and other company officials about the company's financial crisis while making millions and allegedly spending the company's money on airplanes, houses, boats and other luxuries. At a conference for Kmart employees January 22, Conaway accepted "full blame" for the financial disaster. As Kmart emerged from bankruptcy, Conaway was forced to step down and was asked to pay back all the loans he had taken.
While the company was in bankruptcy, Edward Lampert bought Kmart bonds for his hedge fund, ESL Investments. On May 6, 2003, Kmart officially emerged from bankruptcy protection as the Kmart Holdings Corporation and on June 10, 2003, it began trading on the NASDAQ as "KMRT." Lampert took control of the company and began to run it for profit instead of sales.
After dismissing Conaway and Schwartz, Kmart closed more than 300 stores in the United States and laid off around 34,000 workers as part of restructuring the company. Kmart introduced five prototype stores with a new logo, layout, and lime green and gray color scheme, one in White Lake Township, Michigan, a quasi-rural community near Detroit, Michigan, and four in central Illinois: (Peoria, Pekin, Morton and Washington). The new layout was touted as having wider aisles and improved selection and lighting, and the city or town's name was featured under the new Kmart logo at the front entrance. However, Kmart could not afford a full-scale rollout. The lime green prototype was abandoned for the new Kmart "orange" concept that rolled out at nine test stores throughout the United States.
On November 17, 2004, Kmart announced its intention to purchase Sears, Roebuck and Company. As a part of the merger, the Kmart Holdings Corporation would change its name to Sears Holdings Corporation. The new corporation announced that it would continue to operate stores under both the Sears and Kmart brands.
On May 9, 2007, Kmart was penalized $102,422 for violations of federal hazardous waste, clean water, emergency planning and preparation regulations at 17 distribution centers.8 Kmart corrected the violations by preparing and implementing spill prevention control and countermeasure plans, applying for appropriate storm water permits, complying with hazardous waste generator requirements, and submitting reports to state and local emergency planning and response organizations informing them of the presence of hazardous substances.9 The Environmental Protection Agency also accused Kmart of not maintaining adequate information and failing to act in accordance with hazardous waste storage and disposal requirements.10 For instance, the EPA reported having discovered improperly labeled oil storage drums at a location in Falls, Pennsylvania.11
Out of concern for the environment, Kmart promoted battery recycling.12 Kmart even proposed spending about $80 million on full-page newspaper advertisements offering to recycle junk batteries for $2 each .13
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This section does not cite any references or sources. Please help improve this section by adding citations to reliable sources. Unverifiable material may be challenged and removed. (May 2007) |
In May 2007, Sears Holdings Corporation and Kmart named a new mascot and spokesperson for Kmart called Mr. Bluelight. Named after Kmart's well-known "Blue Light Specials," Mr. Bluelight is a talking cartoonish blue light bulb who gives customers ideas to help them make the most of their Kmart experience. Mr. Bluelight has appeared in several television commercials. Specials associated with Mr. Bluelight inside Kmart stores are advertised as "Blue Light Finds" (marked-down merchandise) and "Best of Blue" (higher-end products, often brand-name).
Kmart was also once a major presence in Canada. However, as a result of Kmart's ongoing financial difficulties, the Canadian division comprising 112 stores was sold to competitor Zellers of the Hudson's Bay Company in 1998, after which the stores were either closed or converted to the Zellers brand.
Like Target stores, Kmart-branded stores in Australia belonged to Coles Myer before being acquired by Wesfarmers in 2007, which also holds the rights to the Kmart brand in New Zealand.
In 1992, Kmart purchased several communist-era department stores in Eastern Europe, including 13 in the former Czechoslovakia that were bought from the former Czechoslovak government. One of those stores was the old Maj department store on Národní Třída in Prague. Many of these outlets were quite profitable, with the Bratislava location setting a single store sales record for the company. But Kmart's larger troubles in the United States caught up with its European operations later in the decade. In March 1996, The Kmart Corporation announced that it had agreed to sell the six Kmart stores in the Czech Republic and the seven in Slovakia to Tesco P.L.C. of Britain for about $117.5 million, to focus on its core operations in North America.
In 1999 Kmart began offering a dial-up internet service called Bluelight which was eventually spun off as an independent company. Bluelight was initially free and supported by banner ads. BlueLight dropped the free service in February 2001 and was reacquired by Kmart in July 2001. In 2002 United Online, which owns the NetZero and Juno bought the Bluelight service after Kmart filed for bankruptcy. In 2006, Bluelight dropped the banners. The service now cost $8.95 a month and has around 165,000 subscribers.
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