The purchase was funded through the issuance of 2. In the face of the more uncertain economic climate of the early s, Kohl's nevertheless forged ahead with its aggressive program of expansion. In the company opened 60 more stores and entered several new markets, particularly in the Northeast, including Connecticut, New Jersey, the New York metropolitan area, and Oklahoma. To support its move into e-commerce, Kohl's opened a ,square-foot fulfillment center in Monroe, Ohio.
Of the 62 stores opened in , more than a dozen blanketed the new market of Atlanta while other new markets included Oklahoma City, Austin, Fayetteville, and El Paso. To facilitate this drive into the south central United States, Kohl's opened a fifth distribution center, this one built in Corsicana, Texas. Around this time, Kohl's made an effort to upgrade its brand offerings, commissioning special lines from Jones Apparel Group, Inc.
Once again taking a blanket approach to new markets, Kohl's entered Boston with 13 stores and Houston with 12 stores in Overall, 75 stores were opened that year, bringing the chain total to Late in the year Kohl's opened a ,square-foot distribution center in San Bernardino, California, in advance of a West Coast expansion. In March , shortly after Montgomery succeeded Kellogg as chairman, Kohl's stormed into California, opening no fewer than 28 stores in the Los Angeles area and making Kohl's a coast-to-coast retail chain.
The store total reached with the opening of 85 more outlets. Not all was well at Kohl's, however. Competition heated up as department stores, particularly J. Penney Corporation, Inc. Some analysts contended the big push into the Golden State had distracted management, and indeed the company suffered from excess inventory during the year, forcing it to discount heavily, which dented profits. Some shoppers turned to rival retailers when they encountered less-well-kept stores and longer checkout lines than usual.
The resulting numbers were certainly disappointing: while revenues were up a still respectable During Kohl's concentrated on turning its performance around. The company reduced inventory levels, improved its in-store operations, and made some minor adjustments to the store design to make it easier for customers to navigate and to highlight various brands.
On the merchandise side, Kohl's began introducing new merchandise into its store more frequently and perhaps most importantly moved aggressively to secure exclusive brands that could help differentiate the chain from its growing array of competitors. Seven new exclusive, private or national brands were added in In home products, exclusive Laura Ashley Lifestyles and Gloria Vanderbilt lines debuted, as did a new apparel line from celebrity Daisy Fuentes.
This effort continued in , and in the fall of that year Kohl's became the exclusive U. The turnaround efforts began to pay off in as same-store sales were up 0. The chain now extended to stores in 40 states. In Kohl's opened another 95 stores, most significantly entering the Florida market for the first time late in the year.
To support this new southeastern push, the company opened its eighth distribution center, located in Macon, Georgia. Future plans were no less ambitious. Kohl's aimed to open approximately stores between and , seeking to create a chain of more than 1, outlets by the latter year. Analysts found stores that participated in the Amazon return program averaged And once those customers are there, they're more likely to buy other products they need or want, directly from Kohl's.
The bold move is a great example of how traditional retailers are using out-of-the-box thinking to leverage their strengths. Best Buy is another example of a company that is using brilliant strategy to help it thrive in the age of Amazon.
But the Amazon partnership is just one of a flurry of ideas Kohl's has instituted to shake things up. For example, Kohl's is one of the few major retailers that downsize not by closing stores, but by shrinking them. Kohl's does this by stocking its stores with less, and then subletting remaining space to partner businesses. Fast-growing grocer Aldi opened its first store in a downsized Kohl's last month.
And just last week, Kohl's announced it would be leasing out space to Planet Fitness next to 10 of its stores in The goal is to produce a win-win scenario: Kohl's receives rental income, and both businesses benefit from increased foot traffic.
Creative ideas like these are just one reason Gass ended up with Kohl's in the first place. Previous Kohl's CEO Kevin Mansell wanted a successor who could take a different approach to retail and who wasn't afraid to take risks. Gass spent 17 years with Starbucks and is credited with helping create that company's multibillion-dollar drink: the Frappuccino.
Time will tell if Gass is able to keep things moving in the right direction. But for now, her company's moves seem to be paying off:. Discount is valid for up to 10 transactions. Redeemable November Not valid on Sephora at Kohl's. Valid military ID required. Must-have looks for wherever you're headed. Dress your best for every occasion.
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