Kmart's Time Is Running Out

[klkla]

This article is relevant to Sears/Kmart but let's try to keep it non political:

http://mobile.reuters.com/article/idUSKBN15Q0Q2

[storewanderer]

I think one could raise the question how much of this stuff was Sears really selling online?

Probably not really a big loss... I didn't even know the brand had home items.

I would agree fully with the comment from Neil Stern in the linked article regarding Nordstrom discontinuing the line. Stores cannot stock products that do not sell. You don't see Dillards or Stein Mart discontinuing the line; different territories and customer bases. Stein Mart even advertises this brand over its in-store PA, or was as of a few weeks ago, and was all through the election and holiday period. Florida and Arkansas based retailers handle things differently than Washington based retailers and it is all about knowing your customer.

Sears and Kmart, who is their customer? What is their market? I don't know if it is a big loss. If they had a full line of clothing, home items, etc. online and in-store and discontinued it then it would be a bigger loss.

[BillyGr]

I visited this Kmart again today to see if conditions had changed. Things felt fairly stable compared to when I visited in January. Selection in the electronics department remained sparse (certainly no better). There were only five TVs on display and there were lots of empty spaces on the shelves. The paperback selection was still very picked over; presumably this vendor still refuses to do business with SHLD. There was an entire aisle with nothing but one kind of toilet paper and one kind of bottled water, placed there as filler. There were signs on this aisle saying "Pardon our dust as we transition to a new look." The automotive, tool, school supplies, and small appliance departments were all picked over. Lots of one- and two-deeps in food and health and beauty. Low stock on some types of pet food, beer and refrigerated groceries. The Valentine's Day section was surprisingly small and not attractively presented (truly unbelievable contrast with what I have seen at Albertsons with fresh flowers, baskets, etc., acknowledging that Albertsons vs. Kmart is not an apples-to-apples comparison). Some racks in clothing with only a few items on them. There were hundreds -- probably thousands -- of out-of-stock SKUs across the store. It was a Saturday afternoon and there were either one or two open registers, plus customer service. My checker wasn't wearing a Kmart uniform or T-shirt, just a name tag. I only bought a box of candy; she didn't even ask for a SYW number.

Based solely on the number of out-of-stocks I saw, I can't imagine that first quarter same-store sales are going to be anything but dismal. If it's not on the shelves, people can't buy it ...

"Please pardon our dust while we transition to a new look."

Any chance that the Please pardon our dust aisle was part of a seasonal section? Might make sense as that would be empty after the Christmas items were cleared out before summer type stuff (grills, patio furniture etc.) come in - even Target has had issues with that (why they started a few years back with those various "international" sections to fill the space for a few weeks)?

Other than that, it does look a bit empty, but the sales may depend on just what is missing. For instance, in the auto section if they only have one brand of oil on the shelf it's not as much of an issue (since any brand will work in most vehicles) as if they only have 1/2 the sizes of filters (which are specific to a particular model(s).

I think one could raise the question how much of this stuff was Sears really selling online?

Although it's probably likely that they would be more willing to keep something online (rather than an in store item) with lower sales, since they don't need as much inventory (as they could have the online item in one spot and ship it to anywhere rather than having to have some in each store location).

[kr.abs.swy]

The pardon our dust aisle was down a few aisles from where they had set up a backyard tent and had the summer seasonal area. They had some seasonal merchandise out. So I am not sure whether that aisle was to become summer seasonal or not.

As to the empty shelves, there were two separate issues. There were shelves with tags that were empty. There were hundreds (and probably thousands) of these throughout the store. This represents a serious out of stock problem. Separately, there were sections of empty shelves with no tags (worst in electronics but throughout the store), which represent trimming back of the assortment. I don't think it is much of a stretch to say that 20 years ago there would have been double the merchandise in the store.

I visited this Kmart again today to see if conditions had changed. Things felt fairly stable compared to when I visited in January. Selection in the electronics department remained sparse (certainly no better). There were only five TVs on display and there were lots of empty spaces on the shelves. The paperback selection was still very picked over; presumably this vendor still refuses to do business with SHLD. There was an entire aisle with nothing but one kind of toilet paper and one kind of bottled water, placed there as filler. There were signs on this aisle saying "Pardon our dust as we transition to a new look." The automotive, tool, school supplies, and small appliance departments were all picked over. Lots of one- and two-deeps in food and health and beauty. Low stock on some types of pet food, beer and refrigerated groceries. The Valentine's Day section was surprisingly small and not attractively presented (truly unbelievable contrast with what I have seen at Albertsons with fresh flowers, baskets, etc., acknowledging that Albertsons vs. Kmart is not an apples-to-apples comparison). Some racks in clothing with only a few items on them. There were hundreds -- probably thousands -- of out-of-stock SKUs across the store. It was a Saturday afternoon and there were either one or two open registers, plus customer service. My checker wasn't wearing a Kmart uniform or T-shirt, just a name tag. I only bought a box of candy; she didn't even ask for a SYW number.

Based solely on the number of out-of-stocks I saw, I can't imagine that first quarter same-store sales are going to be anything but dismal. If it's not on the shelves, people can't buy it ...

"Please pardon our dust while we transition to a new look."

Any chance that the Please pardon our dust aisle was part of a seasonal section? Might make sense as that would be empty after the Christmas items were cleared out before summer type stuff (grills, patio furniture etc.) come in - even Target has had issues with that (why they started a few years back with those various "international" sections to fill the space for a few weeks)?

Other than that, it does look a bit empty, but the sales may depend on just what is missing. For instance, in the auto section if they only have one brand of oil on the shelf it's not as much of an issue (since any brand will work in most vehicles) as if they only have 1/2 the sizes of filters (which are specific to a particular model(s).

I think one could raise the question how much of this stuff was Sears really selling online?

Although it's probably likely that they would be more willing to keep something online (rather than an in store item) with lower sales, since they don't need as much inventory (as they could have the online item in one spot and ship it to anywhere rather than having to have some in each store location).

[submariner]

I think one could raise the question how much of this stuff was Sears really selling online?

Probably not really a big loss... I didn't even know the brand had home items.

Marketing-wise, it's a shrewd maneuver. You're likely right that the products weren't big sellers, and I never noticed any advertising for them. Combine that with the toxic nature of the brand currently, publicly removing such low-volume merchandise from the selection will probably cause a small uptick in sales of other items by people supporting the removal of Trump merchandise, more so than the losses of not selling them at all. It's not a political statement in itself, but exploits the political climate to increase sales overall.

[eric1972sea]

Kmart in Burlington WA was opened in 1986 I worked there before it opened and then afterwards. The store is still open but who knows for how much longer.

[storewanderer]

I learned there is only one Super Kmart remaining, in Warren, OH. It is a store from 1995 with its original interior, but condition looks pretty good.

I cannot see how it makes sense to support just one Super Kmart. Even if grocery is supplied by Spartan/Nash, I still do not know how this makes sense.

[arizonaguy]

I learned there is only one Super Kmart remaining, in Warren, OH. It is a store from 1995 with its original interior, but condition looks pretty good.

I cannot see how it makes sense to support just one Super Kmart. Even if grocery is supplied by Spartan/Nash, I still do not know how this makes sense.

Nothing about Kmart makes sense anymore.

They have 9 total stores in Arizona (3 in Metro Phoenix, 1 in Tucson, 1 in Show Low, 3 in Northwestern Arizona (Bullhead City, Kingman, and Lake Havasu City), and 1 in Casa Grande).

None of them are in high income areas and are probably only open as the land values of the stores is such that nobody else wants them.

I'd imagine distribution costs are getting more and more expensive with a smaller and smaller store base of stores in poor neighborhoods.

[storewanderer]

I did some research and found their pilot concept "K Fresh" which some Super Kmarts were converted to actually continues to receive grocery from Spartan Nash and continues to handle a pretty wide assortment of packaged and frozen grocery. Service departments are largely closed but there is still a limited mix of thaw and sell bakery, produce, and prepackaged meat not cut in store.

So Super Kmart is not quite dead on paper, as these K Fresh things are basically following the same old arrangement (ordering grocery from a wholesaler) and run the old 4 page Super Kmart-type ad paper every week.

I am trying to determine what wholesaler they are using to supply a K Fresh in Hawaii, though... I think the Kmart in Guam orders some things from Unified so maybe that is who.