There’s a news item that one of the last remaining KMart stores will be closing this week. When it does, there will be only three KMarts still open.
My question is how does this handful of stores stay open? They’re department stores; they stock a wide variety of items. How do they buy inventory to stock their shelves?
If I decided I wanted to open up my own department store (NemoMart) how would I contact the hundreds of different suppliers I would need to do business? Let’s talk about one specific item, chosen at random; bicycles. I want to sell some bicycles in my store. Do I contact the bicycle manufacturers directly and ask them to send me five bikes for my store? Or are there middlemen who connect the manufacturers and the retailers?
If you’re a middleman who arranges inventory sales to retailers, what happens if you don’t land an account with Walmart or Target? It’s not like it was thirty years ago, where there still a bunch of secondary chains. The two big dogs dominate the market so much, how does anyone who isn’t connected with them make a living?
I watched a video a few years ago about the last K-Marts and they pointed out much of the stock now is either “Stuff your see at Walgreens or Dollar General” so stuff basically EVERYONE gets, or "Old New Stock " where it’s all things that couldn’t be sold at a store before it closed and now it’s being sent to the last remaining store.
I don’t know. I’ll admit I have a hard time picturing a warehouse operation. Where would they locate it? The three remaining stores are in three different states.
I feel they must be buying new inventory (or have been up until very recently). If the remaining stores were just selling off the inventory they had in stock, they would have done so and closed years ago.
Also KMart is owned by Sears Holdings so I am not sure if Kmart have any brands that is exclusive to Kmart that the other divisions of Sear are NOT selling.
Heck, the rump remnant of Sears itself no longer owns its traditional house brands (Craftsman, DieHard, etc.). Sears itself only has like less than 30 full-service stores left (not counting the Home Centers for hardware & appliances).
Well there is a set of intermediaries between manufacturers and retailers called wholesalers. And this is who non-chain stores deal with. [Depending on their size and the particular products involved chains either buy directly from the manufacturer or deal with wholesalers.]. So I assume this is who the remaining K-marts buy from. But products from wholesalers are usually higher priced than products from manufacturers, so K-mart stores are going to be losing money since they compete with Walmart and Target. It’s an interesting question as to why they haven’t been closed down. Perhaps some kind of financing gimmick, loan requirements…
Stores that close down like that would not usually transport all their inventory to other distant stores in the same chain – too expensive; they’d cut their losses if they just dynamite the store and burn it to the ground.
What they do, at least in some cases I’ve seen, is bring in a fire-sale specialist company to take over everything. There are companies that specialize in doing just that.
They come in, take over the store, and run a going-out-of-business fire sale for a few weeks. Everything must go! They even sell the fixtures – all the shelving and light fixtures, the furniture in the break room, the works – right down to the bare cement floors, if they can.
Then they haul away whatever remains, which I think tends to end up at thrift shops.
When our local Kmart closed, I went to their big final sale. I bought some shirts and shorts for $1 a piece, joking that they could be disposable at that price.
Looking back, the quality of the items was so poor that the prices were appropriate. Real crap.
Well I remember going to a Kmart closing sale many, many years ago. I was interested in power tools. One day there were lots of them there, the next day the whole section was gone.
Definitely agreed. Sears (and Kmart) were unlikely to have been able to regain their former prominence, even under leadership which was dedicated to helping them survive; however, there was no reason why they could not have been at least somewhat revitalized.
It was absolutely clear that Lampert had no interest whatsoever in keeping them as ongoing concerns, but rather as assets which could be sold off piecemeal.
I noticed there are definitely people who have the dates marked whenever such-and-such goes below 30% or so when then the price becomes truely “below MSRP”, then they’ll go in, buy as much as they can, and then resell it online.
Video games, board games, power tools, televisions, those are all things I’ve seen people discuss online when was the exact day to go in during a fire sale.
My local K-Mart turned into a (I think) one-off store called Rose’s, that carries basically the same things that K-Mart used to. Most likely, their starting inventory was literally what was left in the building when it closed as K-Mart.
The organization inside the store is even worse than it was as a K-Mart, though. There’s no telling where you’ll find any given item.
I suspect that the only thing keeping the store open at all is that the property values there are extremely low. Nobody even wants most of the other storefronts in the plaza it’s in.
We used to shop at Rose’s all the time when I was a kid; they were pretty big in the South up until the mid 1990s. Back they they were pretty comparable to Wal-Mart and K-Mart. The chain when through financial troubles due to a combination of bad management and increasing competition from Wal-Mart. They closed a lot of stores during that period. From what I understand now they’ve made something of a turnaround and have reinvented themself as more of a dollar store.
Likewise, when the Kmarts in my area closed, both in the ca. 2000 wave and a more recent wave, they obviously got things from their liquidator. In the 2000 closing, they had aisles of, of all things, karaoke machines.
The one nearest my house is now a U-Haul rental center, and also offers storage lockers through U-Haul.
My husband works for a wholesaler that supplies hardware stores with hardware, paint, janitorial supplies etc. They don’t sell to Home Depot, Lowes , etc who presumably order directly from manufacturers. They sell to individual stores and small chains , which don’t order enough to buy directly from manufacturers. The prices are of course higher than a Home Depot or Lowes - but it also means that these stores are not ordering from tens or hundreds of different places. Maybe two or three - because they do price shop and order from a co-op like Ace or True Value (if they are members) or another wholesaler if their prices are better than my husband’s.
I grew up with Roses (in MD) as chain throughout the '80s and '90s. Not sure if they still exist there, but I live in the Midwest now and did see at least one in OH a few years ago (not sure if it’s still there). My recollection was that it was around the same retail tier as a KMart. We had some other similar chains (Ames was one, can’t remember the others) that may have been regional and/or a much smaller footprint than KMart but they were retail chains. Also grew up with Dollar General and Family Dollar (which were never “dollar stores”) and was surprised to see their explosion (and the true to life meme that pretty much every rural town in the middle of nowhere has a Dollar General).