Dow+150.25up+1.52%
10,058.64
Nasdaq+24.82up+1.17%
2,150.87
S&P+13.78up+1.30%
1,070.52
Market Dispatches home page

Kmart gets an early start on the holidays

The discount chain's Web site urges shoppers to get going now.

Posted by Charley Blaine on Tuesday, July 7, 2009 5:45 PM

Attention Kmart shoppers: Start your Christmas shopping now.

 

As Tom Barlow noted on Bloggingstocks.com today, the discount chain, a subsidiary of Sears Holdings (SHLD), now is promoting Christmas shopping on its Web site.

 

Barlow thinks it may be the earliest start of Christmas promotions ever.

 

While there are stores that specialize in Christmas and holiday shopping 365 days a year, Barlow may be right.

 

Normally, you don't start seeing Christmas promotions in most regular stores until, say, Halloween. Purists will say even that's outrageous.

 

I've seen a few start in early October. Sears Holdings

 

In any event, if you go to the Kmart site, you'll see a banner that reads "Take a Stroll Down Christmas Lane."

 

It's obviously a work in progress. Only a few of the links work right now.

 

And Barlow is clearly skeptical that it will generate much business. "Personally, I can't even predict who I'll still like well enough to give a gift to in six months. Stuff happens."

 

So, does this mean Kmart and Sears Holdings are in trouble?

 

Barlow wonders. Sears' stock, however, suggests the company may not be going anywhere yet.

 

Yes, the price collapsed between its April 2007 peak of $193 to $34 in March. But it has moved higher with the market, reaching $70.15 on June 15.

 

It closed today at $59.75.

 

Sears Holdings, however, has few fans among investors. Of the five sell-side analysts who cover the stock, four rate Sears a "strong sell." The other rates it a "moderate sell." It is really rare for analysts to be that negative on a stock.

 

Bloggers hate it. Michael Shulman of ChangeWave Shorts recently called the company "a dead man walking."

 

Then, to be sure readers understood what he felt about Sears, he added, "It's a truly awful company with terrible fundamentals."

 

The skeptics' concern may well be warranted.

 

Same-store sales have fallen for eight consecutive years.

 

Cash flow from operations isn't positive. Cash on the balance sheet has fallen from $4.44 billion to $1.2 billion at the end of its 2008-09 fiscal year.

It has to compete against Wal-Mart Stores (WMT), Target (TGT), Costco Wholesale (COST) and others.

 

(Admittedly, Wal-Mart has some struggles of its own, as Jon Markman noted in an MSN Money column today.)

 

And you have to remember that Chairman Eddie Lampert isn't a retailer. He's a financier, and financial management is how he looks at the company.

Join the discussion!
Sort by:
1 - 15 of 26
Wednesday, July 08, 2009 10:57:29 AM
I do have one more thing to add:  As far as Xmas lists go this year the kids have been notified they will be shorter and less expensive due to income changes.  I also make them give me a list by the end of the month with lots of different choices and then I can do a little shopping each time when I may have a lil extra money, this makes it a little easier.  also this year they will not be allowed to get everything on the list and usually they get ot pick stuff out but no more of that either.
Wednesday, July 08, 2009 10:51:00 AM

I wish more stores had layaway for those of us who are struglging along in these economic times. Especially for electronics it would be great, but K-mart's selection is not very good.  When Circuit City was around they had 90 day layaway

but so much for that.  I think that more stores should consider this now a days and it may help their sales.

Wednesday, July 08, 2009 8:28:01 AM

The issue for me is not whether Kmart and Sears are doing Christmas in July specials.  All stores do it, even Newegg has a Christmas in July sale going on right now and they're mail order and definately not suffering.

 

These ad "gimmicks" are as old as retail itself, and it is an attempt to grab the consumers attention to get them to get interested and come in to buy something.  The problem is, no "gimmick" will work till everyone has the available cash to buy.

 

Kmart has been unattractive for some time due to their "bland" store design.  If you look at Target, or even the latest changes to Wal-Mart stores, they are "attractive" and they are supplying the items people want and need.  Kmart's prices used to be the lowest, but now they are higher than everyone else practically. 

 

I had a Sears Grand in my city, and now it's closed.  A failure of location and design.  The Sears stores have always been a lure due to their design, but the selections have not been the best (save for Lawn and Garden and Appliances).  Even the Toy Department no longer exists in a fashion I used to remember or enjoy.  In the store I go to, it doesn't exist at all except at Christmas.

 

Sears and Kmart needs to change and maybe take a step back and examine what is wrong and correct it, before it's too late.

 

Wednesday, July 08, 2009 8:15:43 AM

Actually, Sparky Joe, Wal*Mart no longer has layaway. K*Mart is one of the few retailers that still offers layaway. As a parent of two small nosy children, and limited space for storage, I find layaway to be very convenient. I can pick out items, put up half and then make cash payments instead of using credit cards and paying interest for the next year

Wednesday, July 08, 2009 8:13:45 AM

No, Wal-Mart DOESN'T have lay-away any more......

 

http://www.washingtonpost.com/wp-dyn/content/article/2006/09/14/AR2006091401728.html

 

Haven't in a while.

Wednesday, July 08, 2009 8:13:30 AM
I agree on the layaway. There's no shame in paying off something larger in manageable pieces by cash. Xmas in July is something that can be done at a craft show for the niche factor, but I don't see it as necessary for a retail store. And this is coming from a self-proclaimed Christmas Nut. How am I supposed to know what people want in six months? What if they need to make a return?
Wednesday, July 08, 2009 8:06:54 AM
You gotta love this.  I never shop at Kmart, but when I saw this article it prompted me to check their web site to confirm my suspicion.  Yup, they have a 90-day return policy.  So let's all go buy a bunch of gifts that we won't be able to give people until December and that we can't return if they don't fit or whatever.  Great idea. 
Wednesday, July 08, 2009 5:22:30 AM
Give me a freaking break!!!! I wish these stores would disappear from the face of the world! That way people would have go back to making the gifts for their loved ones. Anyone can buy something that has been mass produced in China. Be creative, use your imagination make something that is truly unique. Give a gift that has some thought behind it. My son gave my wife a project he made in his first year of trade school. She treasures that little box.
Wednesday, July 08, 2009 4:15:50 AM
I don't know that it's so much about greed anymore.  A lot of businesses are looking at the economy, and this Christmas season is looking pretty scary.  If retailers don't do well enough a lot more people are going to be losing jobs in the retail sector and they're going to put together whatever promotions they think will make a difference.  So this year, I wouldn't look at this as greed, I'd look at this as them trying to keep the company afloat.  I work at a craft store, and craft stores try to promote making Christmas gifts, which takes time, so we're pushing Christmas around October 1st usually.  This year I think we should get a jump start, because I think the craft business is a scary place to be when that's one of the easiest places to cut your spending.  I won't look at it as greed if we start promoting Christmas right now, I'm planning on suggesting it.  I'd just like to keep my job.
#10
Tuesday, July 07, 2009 11:33:55 PM
As a retiree of K-mart I do not believe K-mart or Sears will be around in five years.
Tuesday, July 07, 2009 10:40:57 PM

Egads! The sparklers haven't even cooled down yet and K-Mart is pushing CHRISTMAS??  I'm sorry that any retailer has to do that kind of business to stay afloat.

 

As a store owner, I wouldn't do anything about decorating for Christmas until the day after Thanksgiving. I had people coming in the first of November and thanked me for not shoving, cramming and jamming "Christmas" down their collective throats and they felt more relaxed in making their purchases without the pressure. The Maine Mall was decorated and pumping Christmas carols before the November turkey dinner and though it was pretty, by the second week of December, who cared? The uniqueness of that time of year was already worn off.

 

IF Christmas (or whatever holiday you celebrate) is supposed to be so special and heartwarming  for 4 weeks, why wear out its welcome but starting in July?  No wonder everyone is so sick to death of it a week before and so out of temper.

 

Lay-away was a good thing to keep people on a budget who normally wouldn't be able to come up with a chunk of cash at once. Nothing wrong with using it -- it should come back in vogue with one change--do not allow credit cards to be used to make the payments.  That way it's not the purchase you keep paying for after the fact...saving people money on the usuary rates the card companies charge.

Tuesday, July 07, 2009 10:30:50 PM

First of all, there is no reason to be swearing sparky_joe...Second, I use layaway because my husband will go through and peak at everything.  I usually put stuff on layaway and pay for most of it to begin with, but this way I don't have to worry about anybody ruining the surprise...

#13
Tuesday, July 07, 2009 10:19:47 PM

Why even make Christmas shopping seasonal anymore?  It's gone from just after Halloween to -- yes, I've seen this in some so-called "respectable" chains -- after Labor Day.  Just keep the decos up all year long...go for the greed -- no one cares anymore.  Oh, don't forget there's this holiday just before Christmas called -- what is it -- Thanksgiving?  Merchants, except for Hallmark, have totally forgotten it, which is sad, because more folks travel for Thanksgiving than any other holiday.  I don't put my tree up until Thanksgiving weekend, and I don't even begin shopping until after Thanksgiving. 

 

I do 95% of my holiday shopping online -- easier, because I can do it 24/7; cheaper in many cases; I don't have to fight the insanity called Christmas shopping; and I've never had one problem with any online vendor with regard to returns policies.

Tuesday, July 07, 2009 10:16:16 PM
Don't forget who ran K-mart into the ground-Chuck Conaway-who is currently under indictment for slow-paying vendors to conserve cash.  Walked away with $12 mil in bonuses and pay at 42 years old.   Walmart quality absolutely sucks.  I never find what I want and when I do, they discontinue after so long.  Their sales suck too.  And people go into this store in droves like mindless morons.  I only go because I live in a small remote town and they took our KMart away.  Before that, I NEVER went into Walmart.  I'm not in total agreement that they have a financial manager running Sears Holdings, either.   But it was either sink or swim.   And those of you who have never worked retail, you will never understand how cutthroat it is and maybe managers and help are whiney because of customers like you! 
Tuesday, July 07, 2009 9:49:26 PM
I shop at Kmart, only because they are 2 blocks away.. their prices are comparable to WalMart but one thing they have in common with Walmart is their customer service stinks,, but I think Walmart might be a little worse.
1 - 15 of 26
To add a comment, pleasesign in
Fund data provided by Morningstar, Inc. © 2009. All rights reserved.
StockScouter data provided by Gradient Analytics, Inc.
Quotes supplied by Interactive Data.
MSN Money's editorial goal is to provide a forum for personal finance and investment ideas. Our articles, columns, message board posts and other features should not be construed as investment advice, nor does their appearance imply an endorsement by Microsoft of any specific security or trading strategy. An investor's best course of action must be based on individual circumstances.
Top Gainers
Symbol%Change
SHZ+33.32%
ACLI+24.81%
NBG+24.56%
Top Losers
SymbolChange
TRID-17.13%
CONN-17.04%
TMRK-16.30%
View all lists and trends

MSN Money Video

Search for videos about a specific company.

Click to go to the Market Dispatches Twitter page