Organization Analysis
Background
Kmart was founded in 1899 by Sebastian S. ... The name “Kmart”, the big red “K” symbol, and the term “blue light special” are icons in the discount retail industry . ... Having exclusive rights to popular brands has become an important trend among discount retailers, as evidenced by similar partnerships that Wal-Mart and Target have initiated and relied on for good positioning and sales in recent years . ... As competition became fierce with giants like Wal-Mart and Target gaining ground, Kmart began to lose its footing. ...
SWOT Analysis
Below is a SWOT analysis providing a list of Kmart’s strengths, weaknesses, opportunities and threats within the oligopolous Retail (Discount and Department) Industry, followed by a brief synopsis of each category. ... Supplier power is controlled by Wal-Mart
Online product pricing research
Strengths
Kmart is a household name. ... Many suppliers are even moving their operations to Michigan to be closer to the Wal-Mart headquarters. If Wal-Mart is able to secure exclusive contracts and/or able to purchase inventory at significantly lower prices than Kmart, it will be able to provide products at a lower cost to consumers. ... But overall, Wal-Mart’s superior relationships with suppliers should be considered dangerous. ... For example, If Wal-Mart is offering toaster ovens at 20% less than Kmart, a customer may drive 10 miles to get to Wal-Mart rather than go to the Kmart around the corner.
Market Structure Analysis
Economic Structure
It used to be that smaller family run or regionally targeted stores dominated retail business. ... Kmart and its main competitors, Wal-Mart and Target, compete mainly on price, making them discount retailers. ...
Porter’s 5 Forces
An industry is a group of firms that market the same products. ... Later on we will take a closer look at Kmart’s two main competitors, Target and Wal-mart. ... This model is called Porter’s Five Forces and it is based on the theory that there are five competitive forces that determine industry attractiveness and overall industry profitability. ... For example, a customer can most likely find a GE light bulb at any Wal-Mart, Kmart, Target, Kohl’s, or local pharmacy or grocery store. ... This is because massive retailers like Kmart, Target and Wal-Mart have the ability to exploit relationships with their suppliers. ...
Demand Analysis
Industry Forecast
The Retail (Department & Discount) Industry is currently coming out of a two-year slump and with the rising economy the industry is hoping for a decrease in unemployment and an increase in consumer confidence and spending. ... The list includes improving profitability, accurate analysis, and maintaining a balance between inventory levels and product demand. ...
Time Series Analysis
Sales in this industry are strongly affected by seasonality, calendar events, and erratic happenings. ... These trends can be measured and pulled out of an analysis to accurately measure the affect of a specific event. ... TUES
Wal-Mart de Mexico S. ... (ADR) WMMVY
Wal-Mart Stores, Inc. ...
Taken from Form 10-K, for fiscal 2002
Table 1
2001 Kmart Net Sales 2002 Kmart Net Sales
Sales in Billions % of Total Sales in Billions % of Total
1st Quarter 8. ... 10-K Report, Kmart Corporation, 2002
3.