There were the requisite clowns, balloons and giveaways at the opening of a new K mart in Middle Island, Long Island, recently.
But the real key to this store’s success wasn’t as obvious to shoppers: the design of the selling floor. K niart Corp., after stagnating in the 1980s, is turning itself around by modernizing tired stores and updating technology. The changes are bringing in the results Chairman Joseph E. Antonini has sought: higher sales and profits.
Through the first half of its fiscal year, sales at established K mart stores, those open at least a year, were uo 4.1 percent, a better showing than many other big retailers. And the company’s second-quarter profits rose 10 percent
while several other big store owners saw their earnings swallowed up by the recession.
K mart undertook the massive overhaul â€” which included its marketing strategy as well as more than 2,000 discount stores â€” in the mid-1980s because it was losing business to better-equipped and lower-priced competitors like Wal-Mart
Stores Inc. The retailing industry was moving ahead, but K mart lagged behind.
It also had become the butt of jokes.
The putdowns were aimed at K mart’s image as a boring, low-quality retailer, a perception not helped by its stores’ stale and sometimes-dingy appearance. The company knew it was in trouble.
“Our customers weren’t satisfied,” Antonini said in a recent interview. “They want to feel good about where they shop.”
K mart also lost favor with investors and analysts, especially when its profits skidded nearly 6 percent in 1985, falling to $471 million from $499 million the year before.
In the mid-1980s, the retailer developed the Oak Park Concept, a store design named for a K mart in Oak Park, Mich., that served as the guinea pig for the company’s experiments in layout and technology. Oak Park was designed to “get us away from the 1962 look,” Antonini said.
The Middle Island store, like other new and renovated K marts, includes features of the Oak Park concept, like wider
aisles, which give a store a more spacious feeling and make it easier for customers to navigate during peak shopping periods.
The new layout also has better signs and lighting, so customers can find what they’re looking for more easily.