PORTLAND, Ore. -- Kmart is testing new approaches to food at the Pantry sections of its Big K stores as a possible prelude to revamping its Super Kmart Centers, Dick King, interim general merchandising manager for Kmart food and consumables, said here last week. (For more on the conference, see Page 40.)
King said he is working with Kmart to improve item selection, shrink reduction, advertising programs and promotional activities, "and if we can get those things right at the Pantry sections, then there will be more opportunities, with more space to work with, at the Super K's."
King spoke with SN following formal remarks at Connections 2002, the annual conference sponsored by the Food Industry Leadership Center at Portland State University here.
He said he believes Kmart needs to put more emphasis on private-label food items. "Kmart has been using Fleming's Best Yet label, but it needs to do a better job of merchandising it," he told SN. "We need to review how it's presented, with better shelf locations. Kmart does strong brand promotions on the discount-store side, but there's a need for customers to have a lower-priced alternative [on the food side]."
King said he is working with Kmart's food supplier, Dallas-based Fleming, to improve service levels and develop the right product mix, "and we're making good headway," he pointed out.
Although Kmart intends to continue to offer food through the Pantry sections, the company has not determined whether it wants to continue to operate the Super Kmart Centers, King said. "I expect to develop a plan that will be successful, and if we can improve the sales situation and the profitability -- possibly through densing up the stores -- and make Super Kmart viable, then I would recommend Kmart keep that format.
"Certainly the profitability won't be there in three months, but the strategies will be in place to get the stores heading in the right direction," he said.
King is an independent contractor working with Encore Associates, San Ramon, Calif. -- a company that tries to help businesses solve problems and improve operations. He told SN he hopes to recommend a permanent executive to oversee Kmart's food and consumables operation by the end of the year.
