More than a decade ago, Kmart was Wal-Mart’s biggest rival.
But today the Sears-owned chain is in a tailspin, plagued by negative sales and disinterested customers. Last year, the company closed 100 stores after a disastrous holiday season.
Brian Sozzi at Belus Capital Advisors visited several Kmart locations and took photos that illustrate how grim it is at the retailer.
“The research and photos presented below show that Kmart, believe it or not, may be in worse fundamental shape than Sears!” Sozzi writes. “By fundamental I mean dreadful to visit, borderline unsafe stores that are sending the division’s financials down a path of no return.”
Kmart’s welcome message is obscured by metal carts. “Welcome to Kmart, we want you to walk into these metal fixtures on wheels while you are texting on the new iPhone 5s,” Sozzi writes.
Kmart isn’t making an effort to wow the customer. “In the case of this tired display, you get a depressed feeling before ever even stepping into the store,” according to Sozzi.
The display problem continues inside the store. “Yes, that is a bent in half paper sign telling the consumer ‘please buy these products.’ Sozzi writes.
The electronics section is confusing. “An industrial rack, next to a folding table, next to the aforementioned random washing machine, nearby the Atari-type point-of-sale system,” Sozzi notes.
One of the cooler lights is out, which could give a customer the impression that food is old or expired.
The brown corrosion on the floor below these car batteries caught Sozzi’s eye.
This is what he found below the shelves. “Is this exposure safe for customers and employees?” he asks.
These clothing racks are outdated, showing that Eddie Lampert isn’t investing in his stores. The shelves are also understocked, which could mean that customers who even want to buy the jeans would be unable to.
This shoe display of ugly boxes isn’t alluring to customers, “A consumer that doesn’t come to Kmart for a boot can’t even be enticed to buy a boot from across the store if there are is no display product that is at the eye level,” Sozzi notes.
And this bare shoe display is made even more pitiful by a broken light in the ceiling:
These empty shelves are a problem. “If you have no items to place here, why not dissemble the shelf to improve the department’s appearance?” Sozzi asks. “This display looks as if Kmart is liquidating.”
Kmart’s holiday display is woefully incomplete.
This display for Black & Decker was actually yellowing in person, Sozzi said. The table should have more merchandise and looks alarmingly empty.
The plastic on these Craftsman gift packages was dusty, giving the impression it had been sitting for a long time.
“Here is a random washing machine sitting in the electronics section, next to the DVDs,” Sozzi notes. “And yes, the rug is torn up on the bottom right.”
Even Kmart’s registers are outdated. “Pictured is one of the most outdated point of sale terminals I have seen in recent memory. It sits off in the electronics section. Oh, and all of those wires are exposed to the paying consumer,” Sozzi writes.
The stockroom is highly unorganized, and the open door leaves Kmart vulnerable to theft.
Stores often put complementary items next to each other to encourage purchase, but not Kmart. “Here we have luggage and coolers, summer items, shown next to cold whether items in ice melt and Craftsman snowblowers,” Sozzi writes.
This closed portrait studio or hair salon gives Kmart a doomed, glum feel for the customer. Employees attempted to disguise this with a random merchandise rack:
While major competitors like CVS and Costco are displaying wrapping paper in the front of the store, Kmart’s is placed at random in an empty area. “It’s almost as if Kmart doesn’t want to pocket a sale,” Sozzi writes.
This John Cena display is horribly understocked.
As you exit Kmart, there is a missing letter from the sign thanking you for your business.
“This is akin to a kick in the face of the consumer,” Sozzi writes. “You want a patron to your establishment to feel appreciated for having plunked down their hard earned dollars.”
Business Insider Emails & Alerts
Site highlights each day to your inbox.