Kmart Essay

5788 words - 23 pages

Overview, Current Technology Assessment, and Value Chain AnalysisKmart Holding's purchased Sears Roebuck in an effort to help the two struggling companies survive by combing their technology. Kmart who had filed bankruptcy several years ago has taking on a new challenge. The two companies merge in a deal valued at about $11 billion, creating the third-largest retailer in the U.S. Kmart's chairman, Edward J. Lampert and Sears Chairman Alan Lacy said that the idea behind the merger is to build up a new company, not tear down an old one. But they also are betting that a new management team can forge a single, lower-cost competitor out of two perennial laggards, which likely will mean selling off some stores and cutting redundant operations. They will combine their operations with a single "great culture," and the two retail chains may exchange both store locations and merchandise brands in the process, said top management. (O'Neal, Chandler, & Dresser, 2004).The new Sears Holdings Corp. will have about $55 billion in annual revenue, and about 3,450 stores, the companies said. Sears Holdings will act as the holding company for Sears and Kmart, which will continue to operate separately under their brand names and operate separately under their respective names. Kmart is the place to get Martha Stewart home products, Jaclyn Smith fashions and the popular Joe Boxer line. Sears is the place that carries Kenmore appliances, Craftsman tools, Die hard batteries and, more recently, Lands' End apparel.Top management believes by combining these two stores it will give customers a greater selection at choosing top quality brands under one roof. (Covert, 2004). Analysts and media top management of the two companies said they see a "significant opportunity" for Sears to take over some of Kmart locations as it pursues an off-the-mall growth strategy. Kmart, on the other hand, isn't likely to enter any of the mall-based locations operated by Sears, and management said the combined entity will "let customers decide" the fate of Kmart stores.Kmart is progressing on several initiatives to enhance customer service. The retailer has installed new IBM point-of-sale registers in its 325 highest volume stores and has plans for more this year. By year-end, the remainder of Kmart stores will have these new registers. In addition, 24,000 NCR biotic scanners were recently installed in 1,600 of Kmart's 2,106 stores. These scanners have both flat and vertical bar code readers that are faster and more reliable than a single scanner. These additions will help accelerate the checkout process.On a separate technology related matter, more than 3,500 on-line shopping kiosks are now in place in 1,100 Kmart stores. The kiosks are located in the service, electronics and sporting goods departments to provide customers access to the site's assortment of merchandise. The remaining Kmart stores are slated to receive kiosks by 2002.Kmart recently completed a $70-million...

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