Kohl’s Corporation
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General Company Overview
Kohl's operates about 835 discount department stores in 45 states. Nearly a third of its stores are in the Midwest, where Kohl's continues to grow while rapidly expanding into other markets. Moderately priced name-brand and private-label apparel, shoes, accessories, and housewares are sold through centrally located cash registers, designed to expedite checkout and keep staff costs down. Kohl's competes with discount and mid-level department stores. Merchandising relationships allow Kohl's to carry top brands (NIKE, Levi's, OshKosh B'Gosh) not typically available to discounters; it sells them cheaper than department stores by controlling costs.
Kohl's stores are generally located in strip malls where rents are cheaper and competition is scarce; customers get easier access to the stores.
The fast-growing chain has announced an ambitious growth plan to increase its store count by about two-thirds (to some 1,400 locations nationwide) by 2012.
The retailer introduced a more appealing, modern store format in the fall of 2006 designed to broaden its appeal beyond its current customer base. In 2007 the company plans to open between 110 and 115 new stores, including its first in Idaho and Wyoming.
In a bid to emulate its "cheap chic" rivals Target and J. C. Penney, Kohl's has been busy enlisting big-name designers to produce merchandise for its stores. To that end, the discounter signed designer Vera Wang to produce a low-cost collection, named Simply Vera, which debuted in Kohl's stores and on its Web site in the fall of 2007. The collection comprises women's apparel, intimate apparel, handbags, leather accessories, footwear, jewelry, linens, and towels. Kohl's anticipates the multiyear contract to develop into a $500 million business by the third year. To facilitate its deal with Vera Wang, Kohl's opened a design office in New York City's Garment District in 2006.
Key Financials
Fiscal Year-End / January2007 Sales (mil.) / $15,544.2
1-Year Sales Growth / 16.0%
2007 Net Income (mil.) / $1,108.7
1-Year Net Income Growth / 31.7%
2007 Employees / 114,000
1-Year Employee Growth / 6.5%
Employees At This Location / 700
2007 % of Sales by Department / % of total
Women's / 33
Men's / 19
Home / 18
Children's / 13
Accessories / 9
Footwear / 8
Total / 100
Top Competitors
J. C. Penney
Sears
Target
In the News
January 11, 2008 - Not-So-Merry Christmas: Kohl's Among Retailers Reporting Weak Sales
Kohl's Corp. was among more than a dozen retail chains that lowered profit forecasts Thursday after the worst holiday shopping season in five years. Kohl's said fourth-quarter earnings will be as much as 17 cents lower than the $1.47 a share that financial analysts were expecting. The Menomonee Falls-based department store chain reported a decline of 11.4% in sales at stores open at least a year, which is lower than the 8.4% decrease expected by analysts and one of the biggest decreases among all retailers.
"It just wasn't a very merry Christmas," said Keri Spanbauer, senior equity analyst with Thrivent Investment Management in Appleton. Industrywide, sales rose by just 1.7% for the combined November-December holiday season, according to Retail Metrics, a Massachusetts research firm. The gain was the smallest since 2002, when same-store sales for the two-month period increased by 1%. A majority of retailers reporting to Retail Metrics, 66%, missed the recently lowered expectations of Wall Street analysts.
November 30, 2007 - Bobby Flay Signs With Food Network And Kohl’s To Develop Branded Kitchenware And Entertaining Products
Food Network and Kohl’s Corporation today announced that Bobby Flay has signed on to develop his first collection of kitchenware and casual entertaining products to launch exclusively at Kohl’s in spring 2008. Flay is the first celebrity talent to collaborate with Food Network on a branded line of products.“Bobby Flay’s bold and colorful approach to cuisine is a great fit with Kohl’s and Food Network’s mission to translate culinary expertise into unique and exciting products,” said Sergei Kuharsky, general manager, Food Network. “Bobby has been an important member of the Food Network family for more than 13 years. We are excited to extend our partnerships with Kohl’s and Bobby Flay.” The casual lifestyle brand will include cookware, dinnerware, kitchen gadgets, utensils, cutlery, kitchen textiles, kitchen electrics and barbeque tools. The brand will represent Flay’s flare for food and entertaining with Mediterranean influences, bold colors and rich textures.
November 13, 2007 - Kohl's Announces Exclusive License Agreement With Fila
Kohl’s Corporation and Fila Luxembourg S.a.r.l. today announced a multi-year licensing agreement naming Kohl’s as the exclusive U.S. retailer of the FILA SPORT® collection. The collection will feature women’s, men’s and children’s apparel, footwear and accessories and will be available in Kohl’s stores nationwide and on Kohls.com in fall 2008. "Industry-wide, the active and sport business continues to grow.The addition of FILA SPORT capitalizes on the market opportunity and expands our exclusive offerings with one of the most recognizable names in sportswear," said Kevin Mansell, president of Kohl's Department Stores. "We are confident that FILA SPORT will resonate with our shoppers and is a strong addition to our growing portfolio of world class brands."
October 23, 2007 - Kohl's Receives 2007 EPA Green Power Leadership Award
Kohl’s Department Stores has received a 2007 Green Power Leadership Award from the U.S. Environmental Protection Agency (EPA). The annual awards recognize leading national green power purchasers for their commitment and contribution to helping advance the development of the nation’s green power market. Kohl's is recognized for its voluntary purchase of more than 201 million kilowatt-hours (kWh) of green power annually. “Pursuing renewable energy resources is a priority for Kohl’s so receiving EPA recognition as a leader in green power purchases is a real honor,” said Ken Bonning, Kohl’s executive vice president of logistics. “Our green power purchases coupled with solar installations are two ways we’re working to increase energy efficiencies and demonstrate environmental stewardship.”
October 2, 2007 - Kohl's Unveils Five-Year Strategic Growth Plan; Plans To Increase National Presence To 1,400 Stores By 2012
Today, Kohl’s Corporation announced its five-year strategic growth plan for 2008 through 2012, highlighting financial objectives and plans for a national presence of 1,400 stores. At the same time, the company is celebrating the largest grand opening in its history which includes 95 new stores reflecting innovative features, one new state and 14,000 newly created jobs. "For the past two years, we have exceeded our financial objectives and believe we are well positioned to deliver on our long-term strategic growth plan," said Larry Montgomery, Kohl's Chairman and Chief Executive Officer. “We remain focused on merchandising, inventory management, marketing and the in-store shopping experience as well as our expansion plan.”