Kmart - Porter Analysis
Kmart was founded in 1899 by Sebastian S. Kresge and throughout the 20th century became one of the top discount retailers in the nation. The company went public on the New York Stock Exchange in 1925 under the symbol KM, and it officially changed its name from S.S. Kresge Company to Kmart in 1977. Kmart experienced tremendous growth for its first 100 years of existence and opened well over 2000 stores. The name "Kmart", the big red "K" symbol, and the term "blue light special" are icons in the discount retail industry .While Kmart does not provide a mission statement per se, their vision is to dominate the discount retail services industry by maximizing their performance and improving their market share position through a continuing focus on price, quality, service, product assortment and convenience . Kmart sells a variety of products and services, and primarily targets urban and suburban areas, currently operating in 314 of 331 Metropolitan Statistical Areas in the United States. Throughout its 100+ years of existence Kmart has become a household name in the U.S. and has also expanded to Puerto Rico and the Virgin Islands. Over the past decade or so, Kmart has establi
Debt/EquityLong-term debt is money that the company owes that will not be paid off within the year. Most people have high enough incomes to allow them discretionary funds and an accompanying standard of living that creates the perceived need for such variety. Kmart focused all of its attention on price cuts and failed to acknowledge the significance these other competencies, such as merchandising decisions and customer service . This is important to consider when evaluating the results of a new marketing plan, product launch, or any other measurable change in the retailers business. The special was advertised via TV commercials and circulars and in the beginning was a big hit. 76 100% Fiscal Year February - January Table 2Ratio Kmart Industry AverageFive Year Sales Growth Rate -0. Kmart's contract to exclusively sell the Martha Stewart line, among other popular brands, was its biggest strength in the 90's. Among all image busters, insider trading is high up on the list. This ratio is well under the industry average. These forces are (1) likelihood of new entrants, (2) availability of substitutes, (3) power of suppliers, (4) power of buyers and (5) the intensity of rivalry between industry competitors (See Fig. Despite this hope, Kmart is struggling to remain competitive since filing Chapter 11 in 2002, and the company's most recent forecasts do not predict a profit until 2004 . Finally, Kmart has expanded and redesigned its weekly advertising circulars and has begun to implement as strategic marketing plan aimed at Hispanics, Asians and African Americans, who collectively compromise one of the fastest customer segments .
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