Kmart to Open Early on Thanksgiving
Kmart and Sears, the two major divisions of Sears Holdings Corp. (NASDAQ: SHLD) will join the group of large retailers that hope to move the start of the holiday season closer and closer to mid-November. Kmart will open early on Thanksgiving.
The parent company announced:
Sears and Kmart stores will open on Thanksgiving Day for Shop Your Way members and customers who want to get an early start on their holiday shopping. Members and customers can shop Black Friday deals from Kmart for 41 hours straight, starting at 6 a.m. on Thanksgiving Day to 11 p.m. on Black Friday. Sears stores will open doors starting at 8 p.m. on Thanksgiving Day through 10 p.m. on Black Friday, with more than 1,000 doorbusters available until 1 p.m. Friday afternoon.
Taken as a whole, the nation’s major retailers will compete with one another from dawn on Thanksgiving to midnight on New Year’s Eve. The strategy could backfire, not just for Sears and Kmart, but for their rivals. Moving the dates during which people can shop for the holidays may drain sales toward the end of the period. People who shop early may not shop again. However, some retailers can afford the risk.
Sears, Kmart and J.C. Penney Co. Inc. (NYSE: JCP) cannot afford to allow their stronger competitors, particularly Wal-Mart Stores Inc. (NYSE: WMT) and Target Corp. (NYSE: TGT) any advantages in terms of when people can shop. The weaker companies must have good holiday sales or risk oblivion as their brands become ever more damaged and their balance sheets become ever more troubled. Walmart and Target can wait them out, even if they need to offer discounts to draw the maximum number of customers. In the process, they will bleed the Sears and J.C. Penney franchises to death.
Ultimately, it does not matter when the holidays begin. The National Retail Federation expects “sales in the months of November and December to marginally increase 3.9 percent to $602.1 billion, over 2012’s actual 3.5 percent holiday season sales growth.” The $600 billion is the pie. Retailers that open early will not increase it.
Kmart, Sears and J.C. Penney need a much larger part of that pie. Hours are not the issue. Dollars are.