Something short and sweet this week.
Some of you may have seen the news this week that the last full-size Kmart store, on Long Island, NY, announced it was closing effective Oct. 20.
Gilmore Says.... |
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Kmart laid out the requirements. Vendor heads were spinning. Especially when the deadline was dropped: I am pretty sure was an impossible 90 days.
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Like me, many of you may have thought the last Kmart had closed years ago, but obviously not.
Many of our younger readers may be asking “What is Kmart?”
And that is quite the (tragic) story.
To put it simply, Kmart was Walmart before Walmart was, and could have been the dominant mass merchant. But alas it was not to be.
In Kmart’s early years, it was famous for its “blue light specials,” instant in-store deals announced over the store sound system and identified by a flashing blue light in the aisle of the appropriate department that was both iconic and the punchline to many jokes at the same time.
At its peak, Kmart had over 2000 US stores, far more than Walmart for many years.
But in the end, Kmart was crushed by Walmart - and many have cited Kmart’s lack of attention to the supply chain as key to its ultimate demise.
Then there is this: In the 1980s, Kmart launched a subsidiary called Builder’s Square, a home improvement store before Lowe’s and Home Depot. But they couldn’t operate those stores well either and it was basically finished I think by the mid-1990s.
So it’s quite amazing: Kmart had the chance to become what both Walmart and Home Depot did, but failed in both arenas, down to one soon closing of a Kmart on Long Island.
In the early 2000s, I was told by a senior manager at consulting firm PwC that they were involved in a massive project to get a Warehouse Management System sourced from now EXE to work. I am talking tens of millions.
Don’t believe they ever succeeded.
What I would guess few in our readership today will remember is that Kmart for awhile was the leader in trying to force its vendors to do the following, coming out of the Quick Response movement: carton-specific UCC128 barcode carton labeling, and transmission of advanced ship notices via EDI.
Kmart may not have been the first, but, along with a few leading department stores, ushered in the “vendor compliance” era. And to comply with these and other mandates would require big investments to make happen.
This is circa 1992.
At the time, I was working for a division of Pitney-Bowes, which provided a solution for this challenge for vendors. Early on In Kmart’s program, we were invited to troop up to Troy, MI to a meeting for which about 30 Kmart vendors also attended.
Kmart laid out the requirements. Vendor heads were spinning. Especially when the deadline was dropped: I am pretty sure was an impossible 90 days.
Of course, no one met this deadline – Kmart itself wasn’t ready, even as these vendor meetings with other groups went on for months.
Associated with compliance was the notion of chargebacks - fines, often significant - on vendors for failure to execute correctly (mislabeling, ASN/EDI issues, etc.)
Here, Kmart excelled, gaining notoriety (among other retailers) of issuing a fine for each carton on a shipment for a labeling mistake on just one.
A colleague made a trip around that time to a Kmart DC in Ocala, FL, the first facility in the Kmart network to be part of the program.
He found the labeling and ASNs were not even being used – yet Kmart was issuing vendor chargebacks for non-compliance.
As an aside, while it has requirements for shipping windows I am not sure that Walmart ever required UCC128 labeling. If it did, it was within recent years, relying on the I 2 of 5 case code bar codes instead.
RIP Kmart. It could have been a very different outcome.
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