Kmart
Retailer / private label
UnclaimedAmerican discount department-store chain that became a major mass retailer before a prolonged decline and restructuring.
Last updated August 31, 2026
Overview
Kmart is an American discount department-store chain and online retailer whose history reaches back to the variety-store business established by Sebastian Spering Kresge in the late nineteenth century. The business was incorporated as the S. S. Kresge Company in 1912 and developed from a chain of low-price stores into a large-scale general merchandise retailer. Its stores sold clothing, footwear, household goods, appliances, electronics, toys, groceries, seasonal merchandise and other everyday products. The Kmart name became central to the company in the early 1960s, when the first Kmart-branded stores opened in California and Michigan. The format was designed around large stores, broad assortments and value-oriented pricing, helping Kmart become one of the most recognizable American retailers of the postwar era. Kmart expanded rapidly through suburban development and the growth of big-box discount retail. It operated thousands of stores in the United States and abroad, reaching a reported global peak of 2,486 locations in 1994. Its distinctive in-store Blue Light Special promotion, announced to shoppers over the public-address system, became both a sales device and a widely recognized element of American retail culture. The company also experimented with supermarkets, restaurants, auto-service centers, celebrity and designer partnerships, and several store formats. Big Kmart emphasized home merchandise, children's apparel and consumables, while Super Kmart Centers added substantial grocery departments. The company's fortunes weakened during the 1990s. Kmart faced increasingly effective competition from Walmart and Target, as well as pressure from changing shopping patterns and the growth of e-commerce. Analysts and later accounts associated the decline with underinvestment in information technology and supply-chain systems, inconsistent store modernization, a diffuse corporate strategy and financial decisions that limited funds for reinvestment. Kmart also devoted attention to acquisitions and affiliated businesses, including Sports Authority, Builders Square and Waldenbooks, rather than consistently strengthening its core retail operation. Kmart filed for Chapter 11 bankruptcy protection in January 2002, the largest American retail bankruptcy at that time. It emerged in 2003 under new ownership and merged with Sears, Roebuck and Co. in 2005 to form Sears Holdings Corporation. The merger did not reverse the structural decline. Store closures, shrinking sales and continuing financial pressure affected both chains, and Sears Holdings entered bankruptcy in 2018. Kmart's remaining assets were transferred to Transformco and related entities in 2019. Further closures reduced the American store base to a small number of locations. The last full-sized Kmart store on the mainland United States closed in 2024; later reference material identifies remaining locations in Charlotte Amalie in the U.S. Virgin Islands, Tamuning in Guam and Kendale Lakes, Florida. The Australian and New Zealand Kmart businesses are separate operations and are not the same corporate retail business as the residual United States chain.
History
Sebastian Spering Kresge entered the variety-store business in the 1890s after working as a traveling salesman. He opened an early five-and-dime store in Memphis in 1897 and established a Detroit operation the following year. The business was incorporated as the S. S. Kresge Company in 1912, initially operating a network of fixed-price stores. It became a public company on the New York Stock Exchange in 1918. Store growth continued through the 1920s, although the Great Depression caused closures and reduced profitability. After the Second World War, suburbanization and changing consumer habits encouraged the company to develop larger stores outside traditional downtown locations. The first Kmart-branded store opened in San Fernando, California, on January 25, 1962, followed by the first full-sized Kmart in Garden City, Michigan, on March 1. The brand expanded quickly, while the corporate entity continued to use the Kresge name until changing to K Mart Corporation in 1977 and later Kmart Corporation. The company reached its mature mass-retail scale during the 1970s and 1980s. It operated large discount stores alongside older Kresge and Jupiter formats, eventually selling the remaining Kresge and Jupiter stores in the United States to McCrory Stores in 1987. Kmart's retail identity was built around wide assortments and low prices. The Blue Light Special, introduced in 1965, created short-duration promotions announced in stores and became a durable part of the brand's public image. The company also experimented with food operations, in-store restaurants, auto centers and partnerships with brands and personalities. Its business portfolio expanded beyond core stores through interests such as Sports Authority, Builders Square and Waldenbooks, but these initiatives diverted management attention from the central retail operation. Kmart was overtaken by Walmart as the second-largest U.S. retailer in 1990. Its sales and profitability peaked in the early 1990s, after which the company struggled with store quality, inventory management, technology investment and competitive positioning. It introduced new branding, Big Kmart stores and Super Kmart Centers in an effort to refresh the chain. Big Kmart concentrated on home fashions, children's clothing and consumables; Super Kmart added full grocery departments. Some initiatives produced temporary improvements, but the chain did not establish a sustainable advantage against Walmart, Target and emerging online retailers. The company filed for Chapter 11 bankruptcy on January 22, 2002. It closed numerous stores, reorganized operations and emerged in 2003. In 2005, Kmart merged with Sears, Roebuck and Co. to form Sears Holdings Corporation. The combination preserved both brands but did not halt the long-term deterioration of the store networks. Kmart continued to close locations, and Sears Holdings filed for bankruptcy in 2018. In 2019, Transformco acquired assets from Sears Holdings, including Kmart. Subsequent closures reduced the United States chain to only a few locations. The mainland U.S. big-box format ended in 2024, while a small number of Kmart stores remained in U.S. territories and Florida according to the supplied reference material. Kmart-branded retail businesses in Australia and New Zealand continue under separate local operations and should not be treated as proof that the former American chain has returned to national scale.
- 2024
Mainland U.S. big-box era ends
[1]The last full-sized Kmart store on the mainland United States closed.
- 2019
Transformco acquisition
Transformco acquired assets of Sears Holdings, including the Kmart business.
- 2018
Sears Holdings bankruptcy
[1]Kmart's parent company entered bankruptcy proceedings.
- 2005
Merger with Sears
[1]Kmart and Sears combined under Sears Holdings Corporation.
- 2002
Chapter 11 bankruptcy filing
[1]Kmart sought bankruptcy protection amid financial distress and competitive decline.
- 1997
Big Kmart format launched
[1]The company introduced a format emphasizing home goods, children's apparel and consumables.
- 1991
First Super Kmart Center opens
[1]Kmart opened its first large-format store combining general merchandise with a full-service grocery operation.
- 1990
Walmart surpasses Kmart in U.S. retail ranking
[1]Kmart lost its position as the second-largest U.S. retailer to Walmart.
- 1977
Corporate name changes to K Mart Corporation
[1]The company formally adopted a corporate name centered on its Kmart retail identity.
- 1965
Blue Light Special introduced
[1]Kmart introduced its short-duration, in-store promotional event.
Showing the 10 most recent.
Products and positioning
Value-oriented mass merchant offering broad everyday merchandise at discount prices, with an emphasis on convenience and promotional savings.
Discount department stores · 1962
Kmart general merchandise stores
The core Kmart format sold a broad assortment of everyday goods, including apparel, household merchandise, appliances, electronics, toys, seasonal products and food. Stores were designed around value pricing and one-stop convenience rather than a narrow specialty category.
Discount department stores · 1997
Big Kmart
Introduced in 1997, Big Kmart was a remodeled and repositioned format emphasizing home fashions, children's apparel and consumables. The format became widespread during the late 1990s and early 2000s but was later reduced along with the broader store network.
Hypermarkets · 1991
Super Kmart Center
Super Kmart Centers combined Kmart's general merchandise assortment with a substantial grocery department, commonly including fresh-food counters, a bakery, deli and other supermarket services. The format was an attempt to compete more directly with supercenters and full-line grocery retailers.
Private-label and licensed merchandise · 1997
Martha Stewart Everyday
A prominent Kmart-exclusive merchandise relationship associated with Martha Stewart, covering household, kitchen, garden and related lifestyle products. It helped Kmart use recognizable design-led licensing to differentiate selected categories.
Retail promotion · 1965
Blue Light Special
A short-term promotional offer announced in stores with a rotating blue light and the phrase “Attention, Kmart shoppers.” It was retired in the early 1990s and revived several times before a final reported return in 2015.
Marketing campaigns
- 1997Big Kmart rollout
United States
The company converted and opened stores under the Big Kmart format, highlighting home merchandise, children's apparel and consumables.
Outcome. The format initially generated sales improvements in converted stores and became the dominant Kmart format for a period.
- 1990Kmart brand modernization
United States
Kmart introduced a redesigned logo and began remodeling stores as part of an effort to update its image and respond to changing discount-retail competition.
Outcome. The visual refresh was followed by additional format experiments but did not prevent the chain's long-term decline.
- 1965Blue Light Special
United States
Kmart used brief, surprise in-store discounts announced over its public-address system to encourage immediate purchases and move selected merchandise.
Outcome. The promotion became one of the chain's best-known brand symbols and a reference point in popular culture, despite being discontinued and revived multiple times.
Brand decisions
2019
Transfer assets to TransformcoM&ABackground
Sears Holdings' bankruptcy proceedings created a need to transfer the operating assets of Kmart and Sears.
Action taken
Transformco acquired assets that included the remaining Kmart operations.
Aftermath
Kmart continued as a greatly reduced retailer with only a small number of locations.
2005
Merge with SearsM&ABackground
Kmart and Sears each faced pressure in a changing retail market and combined their corporate resources.
Action taken
Kmart completed a transaction with Sears, forming Sears Holdings Corporation.
Aftermath
The combined company continued to close stores and entered bankruptcy in 2018.
2002
Bankruptcy restructuringStrategyBackground
Falling performance, supplier pressures and competition made the existing operating and financial structure unsustainable.
Action taken
Kmart filed for Chapter 11 protection and pursued store closures and operational reorganization.
Aftermath
The company emerged in 2003, but later merged with Sears and continued to contract.
1997
Introduce Big Kmart formatStrategyBackground
Kmart sought to refresh stores and focus its assortment more clearly on home, children and consumables.
Action taken
The company opened and converted stores to the Big Kmart format.
Aftermath
The format initially improved sales in converted locations but did not resolve the chain's structural competitive problems.
1995
Sell in-store auto-service centersOtherBackground
Kmart operated auto-repair centers but treated the business as non-core and sought a new operator.
Action taken
The company sold its money-losing auto centers to Penske Corporation for operation as Penske Auto Centers.
Aftermath
Penske later closed the centers in 2002 following a payment dispute with Kmart.
Reported sale value. 112 million USD (1995)
Recent events
- 2024
Last mainland U.S. full-sized Kmart closes[1]
Other
The final full-sized Kmart big-box store on the mainland United States closed as the chain contracted to a small residual footprint.
- 2019
Kmart assets transfer to Transformco[1]
M&A
Transformco acquired assets from Sears Holdings, including the remaining Kmart business.
- 2018
Sears Holdings files for bankruptcy[1]
Bankruptcy
The parent company of Kmart and Sears sought bankruptcy protection after years of declining sales and store closures.
- 2005
Kmart and Sears merge to create Sears Holdings[1]
M&A
Kmart completed its acquisition of Sears, creating Sears Holdings Corporation and combining two major American retail names.
- 2003
Kmart emerges from bankruptcy and changes ownership[1]
Other
The retailer completed its reorganization and returned to operation under new ownership.
- 2002
Kmart files for Chapter 11 bankruptcy protection[1]
Bankruptcy
Kmart entered bankruptcy protection after a prolonged decline, supplier and liquidity pressures, and intensifying competition in discount retail.
Sources4 sources
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