Get All Access for $5/mo

Kmart Once Had Over 2,000 Stores. Now It's Closing Its Last Full-Sized Store in the U.S. Kmart had difficulty competing with Walmart and Target.

By Sherin Shibu Edited by Melissa Malamut

Key Takeaways

  • Kmart's last full-sized store in the mainland U.S. will close its doors on October 20.
  • According to an analysis, although Kmart initially grew faster than its competitors, the company’s lack of technology investments hindered its growth.
  • Kmart's market position trapped between the trendier Target and the more price-competitive Walmart led to the company being unable to define who its customers were.

Attention, Kmart shoppers: On October 20, Kmart's last full-sized location in the mainland U.S., a store in Bridgehampton, New York, will close its doors.

That leaves just one smaller Kmart in Miami and three stores in the U.S. Virgin Islands as the only locations left — a far cry from the over 2,300 stores Kmart operated in its prime in the 1990s.

Related: Tupperware Unable to Keep Its Sales Strategy Fresh — Company Files for Bankruptcy

"Kmart was part of America," U.S. retail history author Michael Lisicky told PBS. "Everybody went to Kmart, whether you liked it or not."

The Kmart store in Bridgehampton, New York. Credit: Bing Guan/Bloomberg via Getty Images

What happened? According to the company site, Kmart had a promising start. It opened its first store in 1962, the same year as Walmart and Target. By 1966, sales surpassed $1 billion.

However, in January 2002, Kmart filed for Chapter 11 bankruptcy protection, citing competition and failed sales and marketing campaigns. At the time, Kmart closed about 600 stores and laid off 57,000 employees.

Related: Christmas Tree Shops to Close All 70 Locations: 'I Wish Someone Could Save These Stores'

According to a 2002 analysis, although Kmart initially grew faster than its competitors, the company's lack of technology investments hindered its growth. Its market position trapped between the trendier Target and the more price-competitive Walmart didn't help either, because Kmart wasn't able to define who its customers were.

Kmart emerged from Chapter 11 in May 2003 and acquired Sears about two years later for $11 billion. Meanwhile, sales continued to drop, falling from $37 billion in 2000 to $12.1 billion in 2014. The acquisition didn't pan out either: Sears filed for bankruptcy in October 2018, emerging from it in 2022, and now has only about a dozen stores open in the U.S.

"Sears should have never gone away; Kmart was in worse shape, but not fatally so," Mark Cohen, former CEO of Sears Canada and former director of retail studies at Columbia Business School, told PBS. "And now they're both gone."

Related: Music Retailer Sam Ash to Shut Down After 100 Years in Business

Sherin Shibu

Entrepreneur Staff

News Reporter

Sherin Shibu is a business news reporter at Entrepreneur.com. She previously worked for PCMag, Business Insider, The Messenger, and ZDNET as a reporter and copyeditor. Her areas of coverage encompass tech, business, strategy, finance, and even space. She is a Columbia University graduate.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Side Hustle

At Age 15, He Used Facebook Marketplace to Start a Side Hustle — Then It Became Something Much Bigger: 'Raised Over $1.6 Million'

Dylan Zajac, now a 21-year-old senior at Babson College, wanted to bridge the digital divide.

Innovation

These Entrepreneurs Created a League That Turns Gamers Into Pro Race Car Drivers: 'We're Giving Drivers a Sustainable Career Path'

Racing Prodigy's innovative E2Real sports league is lowering the high-cost barrier to entry for drivers to take their passion to the track.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business News

OpenAI Just Released Its Text-to-Video Generator, Sora. Here's How the New AI Could Impact Small Businesses and Creators.

Sora has a variety of use cases for businesses, from social media campaigns to video creation.

Business News

'Faster, Smarter, and More Relevant': Reddit Tests AI That Combs the Site For You

The AI is like a blend of Google and ChatGPT, tailored specifically for Reddit.

Science & Technology

Machines Are Surpassing Humans in Intelligence. What We Do Next Will Define the Future of Humanity, Says This Legendary Tech Leader.

Craig Mundie, co-author of "Genesis: Artificial Intelligence, Hope and The Human Spirit" dives into the unrivaled power of AI.