Kmart Australia

Kmart Australia Limited
Subsidiary
Industry Retail
Founded 1969 (1969)
Headquarters Mulgrave, Melbourne, Victoria, Australia
Number of locations
 228 (2018)
Area served
 Australia & New Zealand
Key people
  • Guy Russo (CEO Department Stores Wesfarmers )
    Ian Bailey (managing director/CEO – Kmart)
Revenue
  • Increase A$6 billion (2018)
Total assets
  • Increase A$2.3 billion (2016)
Number of employees
 31,000+
Parent Wesfarmers
Website kmart.com.au
kmart.co.nz
ktas.com.au

Kmart Australia Limited is an Australian chain of retail stores (low-price stores), owned by Wesfarmers. It operates 228 stores across Australia and New Zealand[1], with its head office located in Mulgrave, Melbourne.

History

The original Kmart Australia logo, in use from 1969 to 1991

Kmart Australia Limited was born out of a joint venture between G.J Coles & Coy Limited (Coles) and S.S. Kresge Company in the United States, with Kresge owning 51% of the common stock in the company. They began to develop Kmart stores in Australia in 1968.[2]

The first store opened in Burwood East, Victoria, on 30 April 1969 with an estimated 40,000 people passing through the checkouts and taking in over $97,000 (equivalent to A$989 thousand in 2018) on the first day. The store was opened by Mrs HB Cunningham, wife of the president and chairman of S.S. Kresge Company[3][4] The doors had been closed 45 minutes after opening as a safety measure.[5] The site was renovated in 2010 to be a shopping mall known as Burwood One.[6]

Logo from 1991 to 2009, exclusive to stores in Australia and New Zealand, still in use primarily for store signage.
A Kmart store within Eastland Shopping Centre, Ringwood, an eastern suburb of Melbourne.
A 24-hour Kmart store within New Town Plaza, New Town, an inner-suburb of Hobart.
Entrance to Kmart, located in Sturt Mall, in Wagga Wagga, NSW.
Kmart is an anchor tenant of the Meridian Mall, Dunedin, New Zealand.

In 1978 Kresge exchanged its 51% stake in Kmart Australia for a 20% stake in Coles.[2] In 1994 Coles bought back all shares held by Kresge.[2][7]

Kmart expanded to New Zealand in 1988 with a store opened in Henderson, Auckland.[8]

A long-term licensing agreement between Sears allowed Wesfarmers to use the Kmart name in Australia and New Zealand.[9] in August 2017 Wesfarmers purchased the Kmart brand name for use in Australia and New Zealand for $100 million ending the licensing agreement. [10]

In 2006, Coles Group announced plans for Kmart, along with BI-LO and the Coles Group liquor brands, to be merged into the Coles brand.[11] The first re-branded store was planned to open in 2007, with 40 stores, mostly former 'Super K' stores divided last decade into separate Coles and Kmart stores, reformed into Coles Superstores. By March 2007 the plans for these super centres were deferred pending the sale of all or part of Coles Group,[12] and in August 2007, incoming owners Wesfarmers said super centres would almost certainly not proceed.[13]

Kmart's performance immediately prior to the Wesfarmers takeover was poor. In May 2007, it reported a sales drop of 3.2% for the third quarter, and an overall drop in sales of 3.9% for the first three-quarters.[14]

In August 2007 Wesfarmers said it would consider selling all or part of Kmart, or converting some stores to the Target brand.[15] Wesfarmers took control of Coles Group in November 2007 and by March 2008 had decided to retain Kmart and invest $300m in the chain over the next five years.[16]

After continuing poor performance in 2009, the 2010 financial year saw a large increase in EBIT, reporting revenue of A$4.02 billion (equivalent to A$4.02 billion in 2018) and an EBIT of A$190 million (equivalent to A$190 million in 2018), an increase in EBIT of over 74%.[17]

On 15 November 2012, Australia's first multi-level Kmart opened in Adelaide's Rundle Mall.[18][19]

As of August 2015, Kmart has 214 stores trading across Australia – 52 in New South Wales and the Australian Capital Territory, 47 in Victoria, 41 in Queensland, 23 in Western Australia, 15 in South Australia, 5 in Tasmania and 2 in the Northern Territory. There are 20 stores located in New Zealand.[20]

Store concepts

Current store concepts

Kmart Tyre & Auto Service with the Kmart department store and a Coles supermarket located in Wagga Wagga, New South Wales
  • Kmart is a chain of discount department stores that include merchandise such as home entertainment goods, photographic equipment and developing, camping and fishing goods, sporting goods, toys, kitchenware, small appliances, storage & home organisation, confectionery, stationery, books, cards & party goods, furniture, garden supplies, automotive equipment, lighting, hardware, luggage, cosmetics, clothing and footwear. Most Kmarts have photo centres, which also allow Hewlett-Packard's Snapfish customers to collect online orders.[21] The photo centres have operated in conjunction with Hewlett-Packard since 2009, after Kmart ended a 30-year partnership with Kodak Australia.[22] In early 2014, Kmart began a company-wide switch from their Hewlett-Packard powered Minilab system back to a Kodak powered Minilab system, with the latest stores to make the switch being Toowong, Mount Ommaney, and Indooroopilly in November and December 2014.
  • Kmart Tyre & Auto Service (Head Office: Castle Hill, Sydney, NSW), is a chain of auto centres that specialises in automotive accessories, car servicing, tyres, check-ups and motor vehicle insurance. Historically, these stores are usually (but not always) attached to a Kmart store. In early 2006 a number of vehicle servicing facilities at Coles Express service stations became Kmart Tyre & Auto Service outlets which was formerly Shell Autoserv and AutoCare network. As of August 2015 there were 246 Kmart Tyre & Auto Service outlets throughout Australia. In August 2018 Wesfarmers announced that it had entered an agreement to sell Kmart Tyre & Auto Service for $350 million to Continental AG.[23]

In 2013 Kmart began a roll-out of new store layouts. Garden plant sections were removed, and back of store areas were cut back. There was an expansion of floorspace to stock and an increase in the height of displays. The stores were given a more "Department Store" feel with front of shop checkouts replaced with an area for non-self serve customers to pay at in the centre of the store.

Former store concepts

  • Kmart Garden Super Centres specialised in garden, plants and garden furniture. Most of these stores were standalone, "big box" stores in a warehouse format that sold Kmart manufactured or branded outdoor living items. From 1999 to 2007 there were 6 such centres, 4 in Victoria (Chadstone, Fountain Gate, Campbellfield and Watergardens), plus Windsor (Queensland) and Casula (NSW). Kmart closed all the centres in 2007 with the sole exception of the Campbellfield store, (the only store integrated with an existing Kmart store) which was downsized instead, claiming the concept didn't fit its future business strategy. As of September 2011, this store was also shut down.[24]
  • Super Kmart was a hypermarket chain existing between 1982 and 1989. The stores sold all the same lines as regular Kmart stores, plus those sold by Coles Supermarkets. The concept was abandoned by Coles Myer in 1989 with the existing stores split into two separate stores, a standard Kmart store and a Coles New World supermarket.[25]
  • Holly's Restaurant During the 1980s and 1990s, every Kmart store had a Holly's in-store restaurant. Starting from the late 1980s, they were progressively shut down across the country, with the last Holly's at Kmart Horsham closing down on 25 June 2010.
  • Girl Xpress was planned as clothing store chain for young urban women. A concept store was trialled at Burwood East, Victoria from 2006, however was later discontinued. Girl Xpress has been retained however, as a Kmart house brand.
  • Clearance Centre Kmart briefly trialled a clearance centre concept at Ringwood from November 2006 until June 2007.
  • Kmart Food A former supermarket chain operated by Kmart. At least four stores existed and opened alongside the first Kmart stores at Burwood East, VIC Blacktown and Waratah, NSW and Morley, WA in 1969–1970.

Community

Kmart Wishing Tree Appeal

Since 1988, Kmart and The Salvation Army have collected over five million gifts from customers, which are then distributed to those in need.[26][27] The concept for the Kmart Wishing Tree Appeal first came about when Eve Mitchell, a team member from the Kmart store in Noarlunga suggested Kmart use its network of stores as gift collection points, assisting charity groups at Christmas.[28] Over 464,000 gifts were donated to the 2010 appeal.[29]

Controversy

Anzac Day

In February 2010, Kmart requested permission from the NSW State Government to open their stores on Anzac Day (a day of remembrance) prior to the traditional 1 pm time, claiming their customers would be severely inconvenienced by their closure.[30] The request heavily criticized by politicians, ex-Diggers (veterans), and their customers. Kmart's Managing Director Guy Russo withdrew the request in early March, apologising to the community. He said, "I got this one wrong and on behalf of Kmart, I apologise."[31]

Girl Xpress Underwear

In November 2011, Kmart sold female underwear aimed at its youth market which were considered sexually inappropriate. The underwear contained text such as: 'call me', 'email me' and 'I ♥ rich boys'. The garments were withdrawn from sale and an apology was given after they received complaints from customers.[32]

Influencer marketing

A report from the online New Zealand magazine The Spinoff, revealed that two prominent online "influencers" were paid by a PR company working for Kmart when they appeared in a 1 News segment where they appeared to extol the brand.[33]

See also

References

  1. ↑ "Wesfarmers 2018 full year results" (PDF).
  2. 1 2 3 "Sears Holdings: Kmart Timeline (US)". Archived from the original on 29 September 2011. Retrieved 18 August 2011.
  3. ↑ "Coles History 1969". Retrieved 2 April 2017.
  4. ↑ "Kmart Australia: The Kmart Story". Retrieved 12 August 2011.
  5. ↑ "Hundreds of bargain-hunters queue to shop in K-Mart". The Age. 1 May 1969. p. 13. Retrieved 19 April 2010.
  6. ↑ Hopkins, Philip (20 October 2010). "Kmart's first home gets special treatment". The Age. Retrieved 3 August 2017.
  7. ↑ "21.5% Stake in Coles Myer of Australia Is Ended". The New York Times. 5 November 1994.
  8. ↑ "Kmart celebrates 20 years in New Zealand". Scoop. 14 October 2008.
  9. ↑ "License Agreement between Kmart Corporation and Kmart Australia Limited". www.sec.gov. Retrieved 2018-08-15.
  10. ↑ "Wesfarmers 2017 annual report" (PDF).
  11. ↑ "Strategy Update: Driving Value for our Shareholders" (PDF). Coles Group (News Release). 21 September 2006. Archived from the original (PDF) on 2 September 2007. Retrieved 9 August 2007.
  12. ↑ "Coles defers supercentre strategy as sell-off looms". The New Zealand Herald. 20 March 2007. Retrieved 9 August 2007.
  13. ↑ "'Mini-Kmarts' to hold off rivals". Australian Financial Review. 20 August 2007. p. 15.
  14. ↑ "Coles Group 2007 third quarter sales" (PDF). Coles Group (News Release). 17 May 2007. Archived from the original (PDF) on 28 September 2007.
  15. ↑ "Wesfarmers plans Coles investment, restructuring". Reuters. 16 August 2007. Retrieved 8 September 2011.
  16. ↑ "Wesfarmers puts $300m into Kmart". The Age, Melbourne. 20 March 2008. Retrieved 8 September 2011.
  17. ↑ "Wesfarmers 2010 Full Year Report" (PDF). Retrieved 12 August 2011.
  18. ↑ "Our toy story signals battle in city's mall". The Advertiser. Adelaide. 21 October 2011. Retrieved 10 May 2012.
  19. ↑ "Kmart Supplier Update". Retrieved 2 August 2012.
  20. ↑ "Wesfarmers 2015 supplementary information".
  21. ↑ "Kmart Online Photo Centre". Retrieved 28 July 2011.
  22. ↑ "Kmart to launch HP Photo Centre 4.0 nationwide". 18 August 2009. Retrieved 28 July 2011.
  23. ↑ "Agreement to sell Kmart Tyre and Auto Service" (PDF).
  24. ↑ "Kmart Garden Super Centre Announcement" (PDF). Archived from the original (PDF) on 17 February 2011. Retrieved 7 September 2011.
  25. ↑ "Coles Scraps Super Kmart Stores". Retrieved 7 September 2011.
  26. ↑ "Salvation Army – Kmart Wishing Tree Appeal". Archived from the original on 28 September 2011. Retrieved 1 August 2011.
  27. ↑ "Five Millionth Gift" (PDF). Archived from the original (PDF) on 3 April 2011. Retrieved 1 August 2011.
  28. ↑ "About the Kmart Wishing Tree Appeal". Archived from the original on 16 November 2011. Retrieved 1 August 2011.
  29. ↑ "Kmart Wishing Tree Appeal". Retrieved 1 August 2011.
  30. ↑ "Kmart wants us shopping on ANZAC Day". Retrieved 17 August 2011.
  31. ↑ "Kmart backflips over ANZAC Day trading". Retrieved 17 August 2011.
  32. ↑ "Kmart pulls disgusting sleazy girls underwear off shelves". Retrieved 15 August 2012.
  33. ↑ "'Mum's the word': The online influencers secretly paid to go on 1News". The Spinoff. 15 November 2017. Retrieved 24 November 2017.
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