Ongoing Downsizing

When Kmart Corp. (Troy, Mich.) completes its evaluation of its 1800 discount stores in mid-January, the discount retailer is expected to file a plan with the United States Bankruptcy Court seeking approval to close more stores.

As reported in The New York Times, Burt Flickinger III of the Strategic Resource Group said Kmart will ask the court's approval to close at least 300 stores, as well as have the option to close 122 additional stores. Kmart, which has said it wants to emerge from Chapter 11 bankruptcy protection by July 2003, has been evaluating its stores for several weeks to decide on possible closings.

“This means that the company wasn't able to stop the bleeding with the 283 stores they closed last year,” said Flickinger.

A Kmart spokesperson said that affected employees would be the first to learn of the store closures, but would not comment on how many stores will close.

The retailer, which filed for bankruptcy in January 2002, reported third quarter sales of $6.73 billion, down from $8.02 billion in 2001.