THE RISE AND RISE OF K TO THE MART
IT’S ABOUT THINKING OUTSIDE THE SQUARE
I don’t know about you but have you been shopping at Kmart recently? Well I have and it seems I have an addiction to the place. However in the past, I wouldn’t have wasted my time walking through the door, even though I was a proud ex-Kmart employee from the moment I turned 14 years and nine months.
The owners of Kmart, Wesfarmers took a risk and appointed Guy Russo in 2008, the ex McDonalds Australia Chief. A man who knew fast food like the back of his hand but what did he know about a struggling retail giant such as Kmart.
Well, it seems he is quite a smart chap. He definitely thought outside the square. As they say “go hard or go home” and from what I can see, Mr Russo went hard. He travelled overseas with a team to find the best performing retailers. From this little trip he determined that for clothing, UK chain Primark was on top, while Walmart was the best all-rounder and Ikea came out on top as a general merchandiser.
Mr Russo also changed a few major areas such as reducing Kmart’s branded stock from about 70 per cent to about 5 per cent. I guess if you want those ‘branded’ items, you head to Target or Bunnings (which is also owned by Wesfarmers). He also slashed its selection of items from 120,000 to 50,000. Crazy numbers but clearly the right move. Mr Russo believed that prior to his appointment, Kmart was trying to be everything from a Harrods store to 5 and dime (like an $2 shop). And from my observation, he was right. Kmart was trying to be everything to everyone. When I worked at Kmart there was clothing, music, toys, Holly’s Café, nursery, paint shop, pet section, shoes – it was like Target and Bunnings in one store. It was crazy but now………
Now all Kmart stores across Australia are getting a refit (after a huge amount of research) and Mr Russo has made sure that the average price of anything in store is $10. That has allowed Kmart to go from selling 300 million items in 2008 to 700 million in 2015.
And now Mr Russo wants Kmart to be the best, most profitable retailer in Australia. And it looks like it’s going to happen………not bad for a brand that 7 years ago was going down the drain.
Source: My observation (Kristen), Sydney Morning Herald