Potential multiple takeover bids for Kohl's

Predicting the demise of Sears & Kmart since 2017!
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Re: Potential multiple takeover bids for Kohl's

Post by storewanderer »

rwsandiego wrote: January 27th, 2022, 10:00 pm

I completely forgot that Jewel was rumored to acquire Kohl's. Thanks for the memory jog. Never quite understood why A&P just shut down the stores. Then again, I never quite understood why A&P did anything they did.
A&P made excellent business decisions. Their favorite thing to do seemed to be to screw over the long term employees by closing down entire markets rather than trying to sell them as a going concern. I also heard A&P had a great way of handling landlords in those markets they closed down, they just mailed back the keys and stopped paying the lease.

Fortunately some competitors stepped up and tried to get the many viable stores running as going concerns and honored the existing union agreements to help some of the employees.
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Re: Potential multiple takeover bids for Kohl's

Post by pseudo3d »

storewanderer wrote: January 28th, 2022, 12:04 am
rwsandiego wrote: January 27th, 2022, 10:00 pm

I completely forgot that Jewel was rumored to acquire Kohl's. Thanks for the memory jog. Never quite understood why A&P just shut down the stores. Then again, I never quite understood why A&P did anything they did.
A&P made excellent business decisions. Their favorite thing to do seemed to be to screw over the long term employees by closing down entire markets rather than trying to sell them as a going concern. I also heard A&P had a great way of handling landlords in those markets they closed down, they just mailed back the keys and stopped paying the lease.

Fortunately some competitors stepped up and tried to get the many viable stores running as going concerns and honored the existing union agreements to help some of the employees.
In recent years (relatively recent that is), it would've been hard to sell some of the divisions they pulled out of. In the case of New Orleans and Farmer Jack (Detroit) in 2007, Albertsons was shrinking, Kroger wasn't interested in new territories unless they were self-distributing, first-in-the-market stores, and Safeway was busy wrangling its newer divisions to get Lifestyled (Dominick's, Randalls, Genuardi's).

Whatever cost savings A&P got from closing those divisions was quickly wasted when they decided to buy Pathmark within months.
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Re: Potential multiple takeover bids for Kohl's

Post by ClownLoach »

After all my speculation about Amazon and Kohl's I went to go look at one near me. In the words of Charlie Brown, Good Grief! Did they hire everyone who couldn't get a new job after being laid off by Sears, Kmart, JCPenney and whoever else went bankrupt recently? Now I realize why it's been years since I bought anything there. It's either cheap junk that Goodwill wouldn't put on their racks or stale, boring stuff that is priced five times higher than it's Target or Macy's equivalent item. And not a single associate to be found, plus self service checkout where you have to remove your own security tags?!! They might as well put wagons on the floor and prop the doors open to assist shoplifters with ransacking the store. What happened?
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Re: Potential multiple takeover bids for Kohl's

Post by veteran+ »

WOW!!!!!!!

:shock:
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Re: Potential multiple takeover bids for Kohl's

Post by storewanderer »

ClownLoach wrote: January 29th, 2022, 9:45 pm After all my speculation about Amazon and Kohl's I went to go look at one near me. In the words of Charlie Brown, Good Grief! Did they hire everyone who couldn't get a new job after being laid off by Sears, Kmart, JCPenney and whoever else went bankrupt recently? Now I realize why it's been years since I bought anything there. It's either cheap junk that Goodwill wouldn't put on their racks or stale, boring stuff that is priced five times higher than it's Target or Macy's equivalent item. And not a single associate to be found, plus self service checkout where you have to remove your own security tags?!! They might as well put wagons on the floor and prop the doors open to assist shoplifters with ransacking the store. What happened?
Last time I bought something at Kohl's, which was a 90% off item, they forgot to remove the security tag. I left the store and the alarm did not even go off. I had words with the manager about why the alarm did not go off when I left the store and was advised it was "broken at that door." When I commented that was quite unacceptable from a service standpoint as well as a shrink standpoint I was told they had "put in a ticket for it a while ago." I don't care about your ticket, I care that I am having to waste my time coming back to your store. Had that alarm been working I'd have walked back to the cashier and gotten it removed on the initial visit. When I returned the item to the store to get the tag removed, I entered through the other set of doors and the alarm went off as I was entering.

I've heard about Kohl's self checkout but assumed it was a test that never expanded. Was there an employee monitoring it? I heard in the initial units they deployed back in 2021 that there was no employee watching it and if it had a glitch or you needed help that the customer had to press a call button which would page an employee to the checkout area to assist. I could not believe it. I cannot believe that they would deploy this type of a unit anywhere let alone in a major metro area with a high number of theft rings present. Someone told me they stationed security at the door to check receipts/bags but that person could not touch the self checkouts or assist with transactions in any way. Maybe the value of the items is so low that they don't really care... so much really poor quality clothing. Wal Mart does self checkout for its clothing, so maybe it is okay for Kohl's too. Actually a lot of the clothing at Wal Mart is equal or better quality than what Kohl's is offering at this point.

I think Kohl's is still a step above JCP but it strikes me as having many similarities to Sears 5-10 years ago in the feel and look of the stores and merchandise.

And part of this is why I am so hopeful that Dillard's and Macys will get things right and continue to operate their chains long term. They are still running, to at least some extent, a quality operation with decent products. They are not close to 100% execution across their chains but they have a lot of well presented stores and good items.
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Re: Potential multiple takeover bids for Kohl's

Post by ClownLoach »

storewanderer wrote: January 30th, 2022, 10:51 am
ClownLoach wrote: January 29th, 2022, 9:45 pm After all my speculation about Amazon and Kohl's I went to go look at one near me. In the words of Charlie Brown, Good Grief! Did they hire everyone who couldn't get a new job after being laid off by Sears, Kmart, JCPenney and whoever else went bankrupt recently? Now I realize why it's been years since I bought anything there. It's either cheap junk that Goodwill wouldn't put on their racks or stale, boring stuff that is priced five times higher than it's Target or Macy's equivalent item. And not a single associate to be found, plus self service checkout where you have to remove your own security tags?!! They might as well put wagons on the floor and prop the doors open to assist shoplifters with ransacking the store. What happened?
Last time I bought something at Kohl's, which was a 90% off item, they forgot to remove the security tag. I left the store and the alarm did not even go off. I had words with the manager about why the alarm did not go off when I left the store and was advised it was "broken at that door." When I commented that was quite unacceptable from a service standpoint as well as a shrink standpoint I was told they had "put in a ticket for it a while ago." I don't care about your ticket, I care that I am having to waste my time coming back to your store. Had that alarm been working I'd have walked back to the cashier and gotten it removed on the initial visit. When I returned the item to the store to get the tag removed, I entered through the other set of doors and the alarm went off as I was entering.

I've heard about Kohl's self checkout but assumed it was a test that never expanded. Was there an employee monitoring it? I heard in the initial units they deployed back in 2021 that there was no employee watching it and if it had a glitch or you needed help that the customer had to press a call button which would page an employee to the checkout area to assist. I could not believe it. I cannot believe that they would deploy this type of a unit anywhere let alone in a major metro area with a high number of theft rings present. Someone told me they stationed security at the door to check receipts/bags but that person could not touch the self checkouts or assist with transactions in any way. Maybe the value of the items is so low that they don't really care... so much really poor quality clothing. Wal Mart does self checkout for its clothing, so maybe it is okay for Kohl's too. Actually a lot of the clothing at Wal Mart is equal or better quality than what Kohl's is offering at this point.

I think Kohl's is still a step above JCP but it strikes me as having many similarities to Sears 5-10 years ago in the feel and look of the stores and merchandise.

And part of this is why I am so hopeful that Dillard's and Macys will get things right and continue to operate their chains long term. They are still running, to at least some extent, a quality operation with decent products. They are not close to 100% execution across their chains but they have a lot of well presented stores and good items.
The self checkout test was at Huntington Beach a few years ago (their large store at Bella Terra next to the 405). From my many years managing an electronics store a few doors over I can tell you that this was a high shrink location because it was easy for ORC groups to hit the store and jump right on the 405 to disappear. When I saw it was around 8pm, they weren't shutting down all but one entrance as they do today, and they had the Sensormatic type security tags you have to remove with a device that looks like a staple gun. Nobody was around and if you could believe it the self checkout played a little video showing how to operate the removal tool and safely remove the pin/tag without stabbing yourself. I thought that this was the most asinine thing I had ever seen. Also the self checkout was probably programmed to tell you to remove tags from the SKUs that are "supposed to be tagged" but in my experience of using these products most Store Managers will see that they lost a stack of Product X, they get angry, go rogue, and start tagging all of those to deter future losses. But since they didn't get permission from corporate the self checkout isn't going to be programmed to warn the customer to find a tag and remove it so they are likely to either get confused at the register because they see a tag and don't know how to remove it (then calling an associate which defeats the purpose of self checkout) or they are going to potentially take it home as the towers at the doors are notoriously unreliable and won't be set off if the tag is obstructed.

Just an absolute clown show operation. I would imagine that the idiot executive who got sold on this solution and tried rolling it out had never worked a day in a store in their life
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Re: Potential multiple takeover bids for Kohl's

Post by storewanderer »

ClownLoach wrote: February 5th, 2022, 5:04 pm

The self checkout test was at Huntington Beach a few years ago (their large store at Bella Terra next to the 405). From my many years managing an electronics store a few doors over I can tell you that this was a high shrink location because it was easy for ORC groups to hit the store and jump right on the 405 to disappear. When I saw it was around 8pm, they weren't shutting down all but one entrance as they do today, and they had the Sensormatic type security tags you have to remove with a device that looks like a staple gun. Nobody was around and if you could believe it the self checkout played a little video showing how to operate the removal tool and safely remove the pin/tag without stabbing yourself. I thought that this was the most asinine thing I had ever seen. Also the self checkout was probably programmed to tell you to remove tags from the SKUs that are "supposed to be tagged" but in my experience of using these products most Store Managers will see that they lost a stack of Product X, they get angry, go rogue, and start tagging all of those to deter future losses. But since they didn't get permission from corporate the self checkout isn't going to be programmed to warn the customer to find a tag and remove it so they are likely to either get confused at the register because they see a tag and don't know how to remove it (then calling an associate which defeats the purpose of self checkout) or they are going to potentially take it home as the towers at the doors are notoriously unreliable and won't be set off if the tag is obstructed.

Just an absolute clown show operation. I would imagine that the idiot executive who got sold on this solution and tried rolling it out had never worked a day in a store in their life
I went into Kohl's the other night. There were no other customers in the place and it was around 7 PM. There were about 8 employees, mostly congregated around the one front area of the store, the majority of whom greeted me and were friendly. The Amazon return area was closed and a sign directed you to the customer service area to process those returns. There is empty space throughout the store (00's store) including literally hundreds of square feet of empty space directly adjacent to the raceway that you walk past to get to customer service then spend about 20 steps looking straight at as you leave customer service, in kid's clothing; no clue why this area is empty. The rest of the store has empty pockets all over. Their promotional signage is all messed up with literally hundreds of signs that display a message to disconnect it. Or the signs do not make sense- for instance 10% off Levi's that are regularly 69.00 but the sale price is 59.99. That is more than 10% off so why not highlight it, or just show the 59.99 price not the 10% off? Another great deal was Wrangler Jeans- at 5% off.

I really think at this point Kohl's looks about at the level Sears looked right before COVID hit. Or right before we saw brands like Levi and Nike disappear from Sears. I'm not sure exactly when that was. It is getting exponentially worse, exponentially quickly.
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Re: Potential multiple takeover bids for Kohl's

Post by ClownLoach »

Super S wrote: January 27th, 2022, 8:30 am
rwsandiego wrote: January 26th, 2022, 10:42 pm
storewanderer wrote: January 26th, 2022, 9:10 pm

Kohl's problem is they have lost touch with the customer. Their stores are not well rounded and many departments have a dead/tired feel with poor merchandising. They remind me of Sears, not many years ago even. Kohl's has declined quickly; they were not like this even 5 years ago.

Since reopening Kohl's has gotten even worse with significantly less inventory, less staffing, and fewer promotions. Clearly they are trying to balance things but it appears to me they are walking sales (and cash flow) by having less inventory and fewer promotions. This will push them down sooner than if they were operating the way they were 5 years ago.

Some retail types cash flow better than others. Grocery is especially great for cash flow.

I often wondered about a Kohls-some grocer merger. Steve Burd of Safeway was on Kohls Board and at one time they did a few promotions (spend $50 at Safeway get $10 Kohls coupon or something) but nothing really developed. Of course they started out in the grocery business too.
You should have seen what Kohl's looked like before they bought MainStreet from Federated back in the late 1980's. OMG - their stores were terrible. Very outdated stores and low-end merchandise. Essentially, they adapted MainStreet's format and added small electrics, vacuums/floor care, and small furniture (bookcases, TV stands, etc.). Furniture was later eliminated. They used MainStreet's markets of Chicago, Detroit, and Minneapolis as test labs, revamped their Milwaukee stores, and then started their expansion in the mid- to late-90's.

Prior to A&P getting their mitts on it, Kohls Food Stores were pretty nice. They had some beautiful arched stores, much like Safeway's Marina stores.

Not saying they should do this, but if Albertson's bought Kohl's they could re-ignite the Jewel-Osco-Turn*Style concept.
A Facebook page I follow (Dead and Dying Retail) recently posted pictures of a Kohl's opened a few years ago that has open ceilings with warehouse style lights and polished concrete floors. I really hope that they aren't planning more of these as it's not the right look for a chain like this. While I don't consider Kohl's upscale, I don't consider it a bargain basement type of store either at their price point.
They did say a few years ago that effectively a plain big box format was their future growth vehicle. Warehouse ceiling, no dividing walls, perimeter fitting rooms, and mobile fixtures on a concrete floor. The intent was to be completely flexible. Just what a store that doesn't know what it is anymore would do.

They had a deal with Aldi to split up hundreds of the larger stores, around 500 stores, and remodel to the new format in substantially less space with full demising walls turning the building into two independent facilities. I haven't seen a single one actually get done at least not anywhere in California and I'm pretty sure they only got one built out. I'm sure Aldi realized not only the massive customer mismatch and the easier availability of whitespace but also the fact that they were going to be hitched to the wrong horse. That deal is probably as dead as Kohl's will be soon. They were also supposedly going to sublet other stores to Planet Fitness but I'm sure COVID killed that deal.

To properly split a store like this in two - meaning actual demising walls, proper separation of fire sprinkler systems and other building operations, mandates a closure due to heavy construction. Otherwise you wind up with a sloppy drywall divider and maybe a new hole cut in the back wall for another dock but then the two tenants share common fire alarms, fire sprinklers, HVAC systems etc. which is a nightmare to manage. I've worked in two facilities where it was a divided closed Kmart. One was done right and it took six months for them to trench for a new block wall to divide, cut and replumb the fire sprinklers to make two separate buildings out of it, dig a new dock the right way etc. The other was older and got the crappy drywall dividing method and it was a nightmare. Nothing worked independently. If the next door neighbor closed early we would lose our parking lot lights because all the energy management systems for the exterior were all in the other suite. The roof hatch was on our side so the neighbors constantly had to drag their maintenance guys through my store when their refrigeration went down. I am pretty sure that newer building codes won't allow the drywall hack jobs anymore.

This entire proposal was indicative of a inexperienced leadership team that had no idea what the costs are and how difficult it is to just start chopping up open and active stores into pieces. There is a reason the preferred store setup most of the time is fully demolishing previous tenant buildings and starting from scratch as it is usually cheaper. The only reason for gut and redo within existing walls at most times is grandfathered in parking requirements or other permits the site would not get if it was built new to current codes. Same reason why sometimes you see a house completely torn down except for one small wall - by leaving that single wall its a "remodel" and allows for use of expired zoning requirements or other restrictions a new building would not enjoy. The leaders that came up with this hairbrained scheme are the ones that have run the business into the ground as we see today.
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Re: Potential multiple takeover bids for Kohl's

Post by storewanderer »

ClownLoach wrote: February 11th, 2022, 9:35 am

This entire proposal was indicative of a inexperienced leadership team that had no idea what the costs are and how difficult it is to just start chopping up open and active stores into pieces. There is a reason the preferred store setup most of the time is fully demolishing previous tenant buildings and starting from scratch as it is usually cheaper. The only reason for gut and redo within existing walls at most times is grandfathered in parking requirements or other permits the site would not get if it was built new to current codes. Same reason why sometimes you see a house completely torn down except for one small wall - by leaving that single wall its a "remodel" and allows for use of expired zoning requirements or other restrictions a new building would not enjoy. The leaders that came up with this hairbrained scheme are the ones that have run the business into the ground as we see today.
I also sort of get the feeling the buildings Kohl's was building back in the early 00's were, well built buildings. As in they seem as if they were built like tanks. I suspect it is even more difficult to break those up and split them, than it would be a newer building that is more cheaply built with exposed ceilings and such.

Perhaps they can go ahead and downsize stores and sublease them to those seasonal Halloween Stores. Or perhaps seasonal Toy Stores. Maybe they can find someone to open a seasonal garden store in the spring/summer. That may be more productive than Kohl's continuing to operate these stores in their current footprint.

I have no idea why Sephora got involved with Kohl's either, then again I had no idea why they got involved with JCP... but I feel like Kohl's has deteriorated significantly since the Sephora tie up was first announced. I would be having serious second thoughts if I were Sephora.
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Re: Potential multiple takeover bids for Kohl's

Post by ClownLoach »

storewanderer wrote: February 12th, 2022, 1:39 am
ClownLoach wrote: February 11th, 2022, 9:35 am

This entire proposal was indicative of a inexperienced leadership team that had no idea what the costs are and how difficult it is to just start chopping up open and active stores into pieces. There is a reason the preferred store setup most of the time is fully demolishing previous tenant buildings and starting from scratch as it is usually cheaper. The only reason for gut and redo within existing walls at most times is grandfathered in parking requirements or other permits the site would not get if it was built new to current codes. Same reason why sometimes you see a house completely torn down except for one small wall - by leaving that single wall its a "remodel" and allows for use of expired zoning requirements or other restrictions a new building would not enjoy. The leaders that came up with this hairbrained scheme are the ones that have run the business into the ground as we see today.
I also sort of get the feeling the buildings Kohl's was building back in the early 00's were, well built buildings. As in they seem as if they were built like tanks. I suspect it is even more difficult to break those up and split them, than it would be a newer building that is more cheaply built with exposed ceilings and such.

Perhaps they can go ahead and downsize stores and sublease them to those seasonal Halloween Stores. Or perhaps seasonal Toy Stores. Maybe they can find someone to open a seasonal garden store in the spring/summer. That may be more productive than Kohl's continuing to operate these stores in their current footprint.

I have no idea why Sephora got involved with Kohl's either, then again I had no idea why they got involved with JCP... but I feel like Kohl's has deteriorated significantly since the Sephora tie up was first announced. I would be having serious second thoughts if I were Sephora.
From my very recent experience leasing a former big box store that was 18k Sq ft larger than we needed it to be - I can assure you that the construction costs (which we would be liable for as tenant, just like Kohl's would be) far exceeded the expected rent for that space throughout the lease term. To put it bluntly that means it was cheaper to drywall it off and leave it dead than to pay for plumbing, demising wall, etc. Looking at these Kohl's - it would probably cost even more, I agree with the quote that most are built like tanks.
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