Competition faced by K-Mart
The competitors of K-Mart gave it a tough time by adopting strategies suited for the customers and the business environment. Wal-Mart had adopted bulk buying strategy for customers to keep its prices lower. Companies such as Sears, RC Penney, Target and Kohl though operated on a similar format as K-Mart but had focused on a particular department to keep their sales high. Other competition included companies like Toys R Us and Home Depot which only did business in one or few categories but offered greater depth than any other store brand. Most of these competitors had stand alone big box style stores which offered much more options to the customers.
New Strategies for K-Mart
It is suggested that K-Mart should make itself efficient by modernizing itself with new technology in sales and warehousing. It should also move from the concept of being a discount store and should reformat itself in such a way that it should offer depth in one or more unique categories which currently have less competitive market. Corner stores lack space and are expensive to maintain, therefore it should consider the possibility of moving to retail parks with wider stores.
Merger of K-Mart and Sears
Regarding the merger between Sears and K-Mart, it is suggested that both companies should keep their strategies and identity. As both companies have different business models which are successful in one way or another it is suggested that improvements should be made rather than scrapping one strategy for another. It will give them ability to face market competition and provide them with more options to formulate their strategy in the future. Also, by having a different strategy and identity, they will be able to offer a wide variety of products and focus on a much larger customer base. Finally, a change would mean reformatting of stores of both brands, which would incur prohibitive cost.