We saw this article on Kohl’s hitting the 1,000-store mark and had to wonder how much celebration there is for this kind of milestone right now.
The retailer had plans to open 1,400 stores by 2012, but due to cutbacks in expansion that have plagued nearly every major chain, this looks less likely, according to the Journal Sentinel. Management is now saying it is not releasing expansion plans beyond next year, when 50 to 60 locations are in the works.
Kohl’s, like other chains, is experiencing same-store sales slides. In August, they fell 5.6% year over year and 4.6% in the third quarter. But in these times, those numbers aren’t too bad. The chain still posted a hefty $236 million net income during its Q3, though down from the previous year, and its stock closed at $46 yesterday, well under a 52-week high of nearly $64…but hey. Things could be way worse, right?
Talk about bad timing! Kohl’s opened a bunch of stores throughout Florida over the last few years, with many done on the same day, and a bunch more are set to open this month. Like so many others, it moved down here just in time for the housing bubble to deflate. But Kohl’s has good merchandise at good prices, which may be their saving grace in this economy.
I agree, this is a company that should do well in this economy. There is nothing wrong with being hyper-selective about new locations and searching for efficencies in operations as they go forward.
Several of my friends have stopped shopping at Dillards and Stein Mart and are now shopping at Kohls. They offer more variety at a lower price. Besides, women’s fashions change all the time. If you get tired of something you bought at Kohls or it is out of style, you don’t have a lot of money invested.
Kohl’s is smart; retrenching a bit,with their management looking for “bargains” — if other chains/individual stores go into distress over the next 12-18 months, they can cherry pick new locations at-will, make good deals, and they’re not commited to managing a “new store opening” expectation (either from themselves or retail investors at large) that Kohl’s can’t define or project long-term owing to their segment flux.
Kohl’s is playing it smart. They executive management is letting the world (stockholders, employess, the retail market at-large) know it knows how to respond to the twisted market.
They’re not projecting anything beyond next year (managing expectations!). The expansion — wait and see. As other stores/chains become distressed, Kohl’s can pretty much cherry pick locations for growth at non-premium leases/prices.
Hmmm. Interesting, “the company…. not releasing expansion plans beyond next year.” That sounds odd. Most companies will at least let you know where they are headed. Maybe there’s problems with the sales, profit, or something else, and they don’t want to get into it…. just a thought. Who knows???