Kmart

For other uses, see Kmart (disambiguation).

Kmart

Company type	Subsidiary of Sears Holdings Corporation
Industry	Retail
Founded	1899 as the S. S. Kresge Company (Detroit, Michigan) 1962 as Kmart
Headquarters	Hoffman Estates, Illinois
Products	Clothing, Bedding, Furniture, Jewelry, Health and Beauty Products, Housewares, Tools and Hardware, Sporting Goods, Electronics, Toys and Games, and Baby Products.
Website	www.kmart.com

Kmart (sometimes styled as "K-Mart") is a chain of discount department stores in the United States, Puerto Rico, the U.S. Virgin Islands, and Guam. The chain acquired Sears in 2005, forming a new corporation under the name 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 U.S. equity in the Australian business was purchased in the late 1970s. Kmart is the third largest discount store chain in the world, behind Wal-Mart and Target; all three chains were founded in 1962.

As of January 30, 2010, Kmart operated a total of 1,327 (13 closing by late May) 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 sq ft (8,500 m²), and 29 Super Centers, averaging 165,000 sq ft (15,300 m²).

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. However, at this current time, no actual demolition efforts are underway, and the proposed mixed-use complex the Pavilions of Troy, slated for the site has not begun construction due to issues with funding.

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 Troop Beverly Hills, Six Days Seven Nights, and Beetlejuice. According to MoviePlacement.com, the K Mart brand was also mentioned in 80's films such as Rain Man, Ruthless People, and Black Rain, but not in a positive light.

History

The mid-1900's headquarters of the S.S. Kresge Company, in downtown Detroit

Sebastian S. Kresge first met Frank Woolworth when working as a travelling salesman and selling to all nineteen of Woolworth's stores at the time. In 1897 Kresge invested in two five and dime stores with his friend John McCrory; by 1907 Kresge had bought out McCrory.

Kresge opened the first Kmart store on March 1, 1962, in Garden City, Michigan 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.

Changes for Kmart

File:Kmart19631990Logo.PNG

Logo 1962–1990, also used by Kmart Australia from 1980 to 1991. Still in use in some locations; a version with "mart" in italics is currently used in Australia.

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 with the new logo. (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 Super Center

Kmart Super Center (Super Kmart Center, Super Kmart or Super K) opened a 147,000 sq ft (13,700 m²) location in 1991 in Medina, Ohio featuring a full-service grocery store and general merchandise. The second ground-up Kmart Super Center opened in Montrose, Ohio, featuring chain's first full-scale video rental center and a carryout Chinese menu. The location is now closed. Most Kmart Super Centers range in size from 140,000 sq ft (13,000 m²) to 190,000 sq ft (18,000 m²). Current locations feature in-house bakeries, fresh meats and seafood, and a full delicatessen.

Big Kmart

Big Kmart logo

Big Kmart (Big K) opened in Chicago, Illinois, on April 23, 1997. The format focuses on home fashions, children's apparel and consumables (Pantry). Most Kmart stores were remodeled to this format during the late 1990s.

Blue Light Special and 1994 closures

Kmart's red classic logo (1990–2004). It is in use at many older locations

The original Blue Light Special disappeared in 1991, 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 2001, but within a few weeks the program was scrapped.

In September 2009 Blue Light Specials were reinstated on Saturdays, and later on Sundays also.

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.

NASCAR Sponsorships

Kmart used to sponsor several NASCAR teams and races, starting back in the 1980s with several drivers. The store also sponsored the Kmart 400 at Michigan and North Carolina Speedway. Most recently the store sponsored Boris Said's #60 No Fear Ford Fusion in 2007. Kmart got its first win as a sponsor with Lake Speed in 1988 at the Southern 500 at Darlington Speedway.

Bankruptcy

File:Lime Kmart chevron proto.png

Kmart's lime green prototype logo. This logo was only used at five prototype Kmart locations. Notice how an arrow or chevron is formed within the logo. The name of the city or town is located at the front entrance of the stores underneath or beside this logo.

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.

Merger with Sears

Main article: Sears Holdings Corporation

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. Around this time, Kmart changed its logo from a red K with the script "mart" inside to a red block letter K with the chain's name in lowercase letters below it. Most Kmart stores now use this logo on their signage, with some only using the red K and the word "mart" due to space concerns. The whole bankruptcy of Kmart stores were caused by the employment termination of Christopher Jacob Adducci. It was a horrible event that happened, with the CEO of Kmart left in a nervous wreck. No longer would they have their greatest employee running the electronics department of the North Dakota store. :(

Kmart after the Sears Merger

Kmart started remodeling stores to the "Orange" prototype in 2006. The typical white and blue interior of the stores was changed to orange and brown, and shelf heights were lowered to create better sightlines. The remodeled stores contain an appliance department with Kenmore Appliances and most have hardware departments that sell Craftsman tools, which prior to the merger had been exclusive to Sears stores. Some auto centers left vacant by Penske after Kmart filed for bankruptcy have been converted to Sears Auto Centers. 280 stores as of 2009 have been remodeled to this new prototype. For most of these stores, Kmart retired the "Big Kmart" logo and replaced it with the current logo. In some of the larger stores the old logo is still in use.

In July 2009, Sears Holdings opened its first Sears-branded appliance store inside a Kmart. The 4,000 sq ft (370 m²) store-within-a-store opened inside the former garden department of a Birmingham, Alabama Kmart. It is two-thirds the size of the appliance department in most Sears stores, but larger than the 2,500 sq ft (230 m²) appliance department in remodeled Kmart stores.

In October 2009, it was reported that Kmart and Martha Stewart Living Omnimedia failed to come to a new agreement. This came after Stewart made remarks on CNBC that her line at Kmart had deteriorated, particularly after the Sears merger.

In November 2009 Kmart reported its first year-over-year sales increase of 0.5% since 2005, and only the second such increase since 2001.

In the year 2050, Kmart will rise as an empire, destroying all competition, including Wal-Mart and Target. Kmart will now be known as Supreme awesome MART! Let this be known to all who oppose the K!!

Store concepts

Current store concepts

The exterior of a typical Big Kmart discount store in Ontario, Oregon. The red "K" with script "mart" pictured here was Kmart's logo from 1990 to 2004.

K mart is no good!!!

• Kmart is a chain of discount department stores that are usually free-standing or located in strip malls. They carry electronics, music, movies, bedding, hardware, sporting goods, clothing, toys, jewelry, office supplies, health and beauty products, home decor, and a limited selection of food items. Many stores also have a garden center, a pharmacy, and usually have a K-Cafe or a Deli where it serves Nathan's Hot Dogs and pizza. Kmart stores range from 80,000–110,000 sq ft (7,400–10,200 m²). Many of these stores were converted into Super Kmart, and most of them were converted into Big Kmart. Urban multilevel variants of a Kmart store are located in Middle Village, Queens, New York; Southbury, Connecticut; and Philadelphia, Pennsylvania.
• Big Kmart is a chain of discount department stores that carry everything a regular Kmart carries, but with an emphasis on home decor, children's clothing, and more food items. Big Kmart stores range from 84,000–120,000 sq ft (7,800–11,100 m²). Big Kmart stores also feature a garden center, a pharmacy, and usually have a K-Cafe or Little Caesars Pizza Station. Since the merger with Sears, many stores have been converted back to regular Kmarts.
• Kmart Super Center is a chain of hypermarkets that carry everything a regular Kmart carries, but has a full grocery section with meat and poultry, baked goods, delicatessen, garden produce and fresh seafood. Kmart Super Center stores range from 140,000–190,000 sq ft (13,000–18,000 m²). These stores are also known as Super Kmart Center or Super Kmart. Super Center stores also feature a garden center, a video rental store, a branch of a local bank, an arcade, a portrait studio, a pharmacy, and usually a Deli Cafe or Little Caesars Pizza Station. Several also include Kmart Express gas stations, and most had an auto center. 32 Kmart Super Centers are still open, most having been closed during the two rounds of closures in 2002 and 2003 and 20 got their groceries taken out converting them into regular Kmarts. Some of the surviving Super Kmarts were those in regions without a strong Wal-Mart presence, including Ohio and Michigan. A typical Super Center sells around 30 million dollars of merchandise during one fiscal year. However, due to the recent losses, K-mart is now jokingly known as Kame apart.
• K-Café is an in-store restaurant that Kmart has inside stores that has soft pretzels, hot dogs, sandwiches, drinks, and coffee. In addition to the cafe's menu, hot food items can also be purchased at the deli and eaten in the Deli Cafe at Super Kmart Center stores.

Former store concepts

The exterior of a Super Kmart in Corsicana, Texas. This store is no longer in business

• Kmart Food Stores were a grocery store chain founded in 1962. Most Kmart Food locations were together with Kmart stores, often operated by a local grocery chain but always branded as Kmart foods. The chain was discontinued in the 1970s.
• Builders Square was a home improvement superstore. In 1997, it was sold to Hechinger, which went out of business in 1999.
• Borders Books is a chain of book stores acquired by Kmart in 1992. In 1994, Borders merged with the Kmart chain Waldenbooks to form Borders-Walden Group, which was sold in 1995.
• Waldenbooks is a chain of primarily shopping mall-based book stores which was acquired in 1984. In 1994, Kmart chain Borders merged with Waldenbooks to form Borders-Walden Group, which was sold in 1995.
• OfficeMax is a chain selling office supplies and office furniture which was acquired in 1991, and sold in 1995.
• Office Square was a chain selling office supplies and office furniture which was a spin-off of Builders Square. In 1991, OfficeMax was acquired by Kmart and Office Square was merged into OfficeMax stores.
• Pace Membership Warehouse was Kmart's warehouse club brand, until the chain was purchased by Wal-Mart. In 1993, Wal-Mart converted most of the stores into its Sam's Club brand, and sold others to chains such as Bradlees.
• PayLess Drugs was a chain of drug stores acquired by Kmart until it was sold to TCH Corporation in 1994. The resulting entity, Thrifty PayLess was acquired by Rite Aid in 1996, which converted all of the PayLess and Thrifty stores into Rite Aid stores in 1999. The PayLess division also owned Bi-Mart, which was spun off along with sister stores such as Pay 'n Save.
• The Sports Authority is a chain of sporting goods stores which was acquired in 1990 and sold in 1995.
• American Fare was a chain of hypermarkets that first opened in January 1989. American Fare was a joint venture between Kmart (which owned 51 percent), and Birmingham, Alabama-based Bruno's Supermarkets. The first store opened near Atlanta, Georgia. American Fare’s 244,000 sq ft (22,700 m²) of retail space included 74,550 sq ft (6,926 m²) of groceries, 104,000 sq ft (9,700 m²) of general merchandise, and 35,000 sq ft (3,300 m²) of clothing (including apparel, footwear, and accessories). An area in the front of the store housed a music and video store, a food court, bank, hair salon, pharmacy and a card store. Charlotte, North Carolina, was home to the second American Fare, which opened in late 1989 with only 160,000 sq ft (15,000 m²) of retail space. A third and final store opened in Jackson, Mississippi. In June 1992, Bruno's announced that its partnership with the Kmart Corporation was being terminated, and that Kmart would assume ownership of the three stores. However, the stores were closed in the mid-1990s. The American Fare brand is used on some Kmart store brand consumable products.
• Kmart Chef restaurants were a small chain of free-standing fast-food restaurants owned by Kmart, started in 1967 with the first location on the parking lot of a Kmart in Pontiac, Michigan. The "limited, high-turnover menu" (as Kmart founder S.S. Kresge put it) consisted of fast foods such as burgers, french fries, hot dogs, and soft drinks. The Kmart Chef chain folded in 1974 after peaking at eleven locations.

Philanthropic Contributions

Kmart for Kids is the umbrella program for Kmart's philanthropic initiatives. The program helps children across the country live happier, healthier lives through the support of: March of Dimes, St. Jude Children's Research Hospital, and American Diabetes Association.

March of Dimes

Kmart is March of Dimes' number 1 corporate sponsor, raising over $71 million for stronger, healthier babies.

On July 29, 2008 Don Germano, SVP/GM of Kmart stores, was elected to a five-year term on the national Board of Trustees of the March of Dimes Foundation.

St. Jude Children's Research Hospital

Kmart for Kids supports St. Jude through its annual Thanks and Giving campaign: an opportunity for Kmart customers to give thanks for the healthy kids in their life, and give to those who are not. Kmart has been a partner of the campaign since 2006 and has raised more than $8 million for St. Jude to date.

American Diabetes Association

In 2008, Kmart earned the "Outstanding Corporate Citizen" Award for its support of the American Diabetes Association's "Step Out: Walk to Fight Diabetes" program. The tribute honors Kmart for the most well-developed, proactive program in the areas of charity, community Development, Diversity, philanthropy, and associate development. In 2008 Kmart became a national sponsor of "Step Out: Walk to Fight Diabetes" and over the past two years, Kmart's customers and associates have raised approximately $1.5 million through its in-store campaigns.

Environmental record

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. 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. 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. For instance, the EPA reported having discovered improperly labeled oil storage drums at a location in Falls, Pennsylvania.

Out of concern for the environment, Kmart promoted battery recycling. Kmart even proposed spending about $80 million on full-page newspaper advertisements offering to recycle junk batteries for $2 each .

Mascot and spokesperson

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).

Canada, Europe and Australia stores

File:Kmart australia.svg

Kmart Australia logo

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.

BlueLight internet service

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 also owns NetZero and Juno, bought the BlueLight service after Kmart filed for bankruptcy. In August 2006, Bluelight dropped the banners. As of August 2006, the service costs $14.95 a month and has around 165,000 subscribers.

CEOs

• W. Bruce Johnson, Current President and Interim CEO of Sears Holdings Corporation
• Aylwin Lewis, Former President and CEO of Sears Holdings Corporation
• Bernard Fauber
• Charles Conaway
• Floyd Hall
• Harry Cunningham
• James Adamson
• Joseph Antonini
• Julian Day
• S. S. Kresge, Founder

Controversy

Kmart stores have been targeted in an Industrial Workers of the World campaign to get Kmart's parent company, Sears Holdings Corporation, to stop advertising through Havas' MPG.

See also

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• Kmart Australia, operated by Wesfarmers
• Sears Holdings Corporation

References

Sources

• Original CNN Coverage

External links

• Kmart Official Website (Corporate)
• Kmart Official Website (Online Store)
• KmartDesign.com Microsite
• Super Kmart Official Website (Online Store)
• FBI investigates Kmart (BBC)
• Tampabay.com Column on Kmart's demise