A Retailing Legend is Born
More than one hundred years ago, Sebastian Spering Kresge opened a modest five-and-dime store in downtown
Detroit...and changed the entire landscape of retailing. The store that Kresge built has evolved into an empire
of more than 1,500 stores and an Internet presence that reaches millions of customers. The Kmart name has become
a symbol of Americana, standing for quality products at low prices.
When Kresge opened his first store in 1899, he sold everything for 5 and 10 cents. The low prices appealed to
shoppers and allowed him to expand to 85 stores in 1912, with annual sales of more than $10 million.
War and financial depressions hit America hard over the next decades, but Kresge stores were always there to
offer families products at prices they could afford. They also offered people what other businesses at the time
could not -- jobs to support their families.
As time went on, prices may have changed, but the business philosophy stayed the same -- offer consumers products
they need at prices they can afford -- and they'll keep coming back.
By the mid-1920s, the S.S. Kresge Company was opening locations that sold items for $1 or less, a precursor to
the current discount store. These ''green-front'' stores often were right next to the traditional red-front
five-and-dime Kresge stores.
Ten years later in 1937, Kresge opened a store in the country's first suburban shopping center -- Country Club
Plaza in Kansas City, Missouri.
Staying Competitive
The retail environment was getting more competitive, and again Kresge blazed the trail for future retailers by
launching a newspaper advertising program to entice shoppers to its stores. Those print ads were the precursor
to radio promotions, which followed 20 years later, and then TV commercials, which began to air in 1968. Kmart
is still the leading print promotional retailer, with weekly circulars reaching millions of households each
week.
By the 1950s, it was evident that the company needed to change to continue to be a leader in the growing
competitive retail environment. That change came through Harry B. Cunningham, who became Kresge President in
1959. Cunningham had been studying other discount houses and developed a new strategy for the Kresge
organization.
Under Cunningham's leadership, the first Kmart discount department store opened in 1962 in Garden City, Michigan.
Seventeen additional Kmart stores opened that year, leading to corporate sales of more than $483 million that
year.
Just four years later in 1966, sales in 162 Kmart stores and 753 Kresge stores topped the $1 billion mark. In
1976, S.S. Kresge made history by opening 271 Kmart stores in one year, becoming the first-ever retailer to
launch 17 million square feet of sales space in a single year.
In 1977, nearly 95 percent of S.S. Kresge Company sales were generated by Kmart stores. To reflect this dramatic
impact, the company officially changed its name to Kmart Corporation. Ten years later, Kmart sold the remaining
Kresge stores to fully concentrate on discount merchandising.
Back to Basics
In 1990, Kmart unveiled a bold new logo and a bold new plan -- a five-year, $3.5 billion new-store opening,
enlargement and modernization program to focus the business back on what mattered most -- its Kmart stores.
In 1991, as part of the new plan, Kmart opened the first Kmart Supercenter in Medina, Ohio, offering a
full-service grocery along with general merchandise 24 hours a day, seven days a week.
In 1996, a complete redesign of the Kmart store was launched, making them cleaner, brighter and easier to shop. A
''Pantry'' department selling frequently purchased consumable goods was moved toward the front of the store and
a new focus was placed on the Children's and Home Fashions departments. These ''big'' changes were signified by
a new name for the remodeled stores -- ''Big Kmart.''
To further expand the reach of the company, in December of 1999 Kmart launched a new Internet presence,
BlueLight.com. By initially offering free Internet service, BlueLight was able to register a record-breaking
number of users in its first few months. Shoppers now know the e-commerce and information site as www.kmart.com.
Moving Forward With Determination
On May 6, 2003, Kmart and 37 of its U.S. subsidiaries and affiliates emerged from the Chapter 11 reorganization
process - 15 months after they filed for Chapter 11 in the United States Bankruptcy Court for the Northern
District of Illinois on January 22, 2002. Under the leadership of President Julian C. Day, who was promoted to
Chief Executive Officer in January 2003, the Company achieved several important objectives during its fast-track
reorganization. The Company's accomplishments included strengthening its balance sheet and significantly
reducing debt; securing $2 billion in exit financing; focusing its store portfolio on the most productive
locations and terminating leases for closed stores; and developing a more disciplined, efficient organization
and lowering its overall operating costs.
Kmart emerged from Chapter 11 as a new and vital enterprise focused on delivering value to customers and
stakeholders alike. Its focus going forward will be on continuing to revitalize its business by driving
profitable sales, identifying opportunities to further improve efficiency and reduce costs, and enhancing asset
productivity. Kmart's associates are facing the future with new energy and enthusiasm -- and a renewed
commitment to providing customers with compelling promotional values, great private brands and excellent
service.
Kmart is moving forward with the kind of determination that would have made S.S. Kresge proud. We have a good
business plan, a strong core portfolio of stores, customer loyalty earned over many years, and the will to
succeed. As Kmart continues to operate stores across the country, customers can be assured that their
communities will always have a broad selection of top-quality products at exceptional values.
This ends the original "History of Kmart" from Kmart Corporation in 2005. Further history continues as Sears Holdings Corporation.
An Excerpt From Sears Holdings - 2005
The merger of Kmart and Sears as Sears Holdings Corporation closed on March 24, 2005, following affirmative shareholder
votes of both companies. The company's corporate headquarters is in Hoffman Estates, Ill. Kmart maintains a headquarters
office in Troy, Mich. Sears Holdings will operate Sears and Kmart stores, and will begin opening a combined format named
Sears Essentials during the second quarter of 2005. The company will continue to market products under brands held by both companies.
Sears Holdings is the leading home appliance retailer in North America and is a retail sales leader in tools, lawn and
garden, home electronics, and automotive repair and maintenance. Key proprietary brands include Kenmore, Craftsman and
DieHard, and a broad apparel offering, including such well-known labels as Lands' End, Jaclyn Smith and Joe Boxer, as
well as the Apostrophe and Covington brands. The company also offers Martha Stewart Everyday products, which are
available exclusively in the U.S. at Kmart and in Canada at Sears Canada.
More History Coming Soon!
We're working to pull the history of this company from the Sears Archive, news articles, former associates, and more to bring you
an accurate source of Kmart history. Thank you for your patience as we continue designing this page.
|