Kmart:Striving For A Comeback Case Study

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KMART: STRIVING FOR A COMEBACK

COMPANY:

Kmart Corporation is facing a serious problem with regards to the problem of bankruptcy protection that had allowed it to continue its operation even though it had been delinquent on obligations of more than $4.7 billion owed to creditors, vendors and leaseholders. The bankruptcy< which was filed in January 2002 was the largest bankruptcy in U.S. retailing history and was the culmination of decades of poor strategy execution that resulted in an overall deterioration of Kmart's competitive position in the discount retail industry and a roller-coaster earning history.

Strengths and Weaknesses:

A. Employees

The concern of the company with regards to the attitude and performance of Kmart store managers and associates were adversely impacting shopper visits and loyalty. Hall brought all Kmart store managers meeting. The executive team made it clear that they intended to end Kmart's historically insular, turf-wary organizational culture and adopt a more team – oriented atmosphere at both corporate headquarters and in the stores. The company announced its new management development program to help the company develop future store-level and corporate level – managers from within its ranks.

The company is criticized for lack of concern in promoting sound management to ensure productivity and efficiency in the process.

B. Customer

It is sad to note that Kmart is unresponsive to customer service. A 1994 Forbes article cited customer complaints of indifferent Kmart employees who, when asked for a specific item in the store, would wave their hand in a general direction. One disgruntled shopper complained "At the superstores in Farmington Hills or Southfield, the help is su...

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...t system and poor supplies chain management The company is threatened by the financial losses and in its inability to remain liquid, solvent and profitable Opportunity for the company is big if it is able to deal with its finances and as well as its product lines.

2 The customers are the lifeblood of the business there is a need to improve its customer service Customer service are poor If customer service is not properly handled, then further losses would mean closure of the company There is a need to assess consumer preferences and choices in order to ensure customer satisfaction

3 Pricing should be low in cost but quality service Poor pricing strategies It is threatened by the problem of its competitor's strategy which gains competitive advantage Opportunity depends on its ability to remain liquid and solid in solving the problem.

siurce:company annual reports

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