Kmart - Forced Towards Bankruptcy?

            
  
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Case Details:

Case Code : BECG021
Case Length : 15 Pages
Period : 2003
Organization :Kmart
Pub Date : 2003
Teaching Note :No
Countries : United States of America
Industry : Retailing

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Background Note

For decades, US discount retail industry observers referred to Kmart as one of the three pillars of the industry, besides competitors Wal-Mart and Target. Not only were Kmart stores present in all the 50 states of the US, 85% of the country’s population lived within 15-miles of a Kmart Store. While the Kmart store of the early 21st century came into existence only in 1962, its origins can be traced date back to 1899 (Refer Table I for Kmart’s timeline).

 Business Ethics Case Studies | Case Study in Management, Operations, Strategies, Business Ethics, Case Studies

As the timeline clearly shows, Kmart restructured itself frequently after the 1980s. This had, in fact, become unavoidable considering the competition posed by Wal-Mart and the comparatively recent entrant, Target. Kmart’s growth had slowed down considerably because the competitors had raised customer expectations regarding service and quality. Kmart’s merchandise, was consequently, seen as poorly made, cheap and of low quality. Kmart also had to deal with problems posed by poor inventory management, an outdated and under-developed information technology (IT) infrastructure and distribution inefficiencies.....

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