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Kmart, American retail chain with a history of marketing general merchandise primarily through discount and variety stores. It is a subsidiary of Sears Holdings Corporation.
The company was founded by Sebastian S. Kresge, a traveling hardware salesman, and John G. McCrory, owner of eight general merchandise stores in the eastern United States and one of Kresgeâs customers. In 1897 the two opened a pair of five-and-ten-cent stores in Memphis, Tennessee, and Detroit, Michigan (McCrory continued managing his McCrory Corporation stores through the 1920s). Kresge ultimately became the sole owner of this venture and by 1907 operated S.S. Kresge stores in eight cities between Chicago and Pittsburgh, Pennsylvania. With Kresge as president (1907â25) and chairman of the board (1913â66), the company expanded steadily. Kresgeâs at first restricted the price of its merchandise to not more than 10 cents, but inflation triggered by World War I drove the limit to 15 cents and higher.
In 1962, under a program designed by company president Harry B. Cunningham, Kresgeâs entered the large-scale discount retail market with construction of the first Kmart store outside Detroit. With its success, the company expanded aggressively, erecting an average of 85 discount stores per year over the next two decades throughout the United States and parts of Canada. During this time Kmart also introduced (1965) its popular âBluelight Specials,â surprise deals that were announced in-store and offered for only 15 minutes; after 1991 they were only occasionally used. The corporate name was changed to Kmart in 1977. Kmart was particularly prescient in arranging a retail agreement with Martha Stewart: in 1987 the company hired her to serve as the public face for its entertainment and lifestyle products, and in 1997 Kmart became the exclusive retail store for the Martha Stewart Everyday line of home furnishings.
Kmartâs expansion continued throughout the 20th century, and by 2000 the company operated 2,200 Kmart, Big Kmart, and Super Kmart stores in the United States, Puerto Rico, Guam, and the U.S. Virgin Islands. Increasing competition with the worldâs largest retailer, Wal-Mart, and other discount stores, however, led Kmart to declare bankruptcy in 2002. Although some of its retail stores were shuttered, Kmart survived both the bankruptcy and the legal difficulties experienced by the representative of its star brand, Martha Stewart. The reorganized Kmart Holding Corporation acquired Sears, Roebuck and Company in 2005 for some $12 billion and took the name Sears Holdings Corporation, the corporate entity formed to manage the Kmart and Sears retail brands. Edward S. Lampert controlled nearly 40 percent of the new corporation. Although the holding company remained prosperous, sales at Kmart and Sears stores continued to decline. In 2009 Stewart accused Kmart of allowing her line to âdeteriorate,â and their partnership ended the following year. During this time various Kmart stores were closed. In addition, the financial stability of Sears Holdings became increasingly uncertain, with Lampert drawing criticism for his handling of the corporation. In October 2018 Sears Holdings filed for Chapter 11 bankruptcy protection.
