Customers leave a Kohl’s store on November 12, 2015 in San Rafael, California.
Justin Sullivan | Getty Images News | Getty Images
Kohls sees an opportunity in the coronavirus pandemic to steal market share from troubled retailers and gain new customers if competitors go bankrupt and liquidate their stores.
“We are really set to capture what billions of dollars will be in the future,” Chief Executive Michelle Gass said Tuesday during a conference call.
She said the company is “actively looking for opportunities to gain competitive market share from competitors and close stores,” with its more than 1,100 locations, 95% of which are located outside the closing shopping malls. Much of the mishandling in retail lately has come from traditional shopping malls such as department stores and clothing brands.
“Even in the midst of the pandemic, we are gaining new customers and looking forward to great opportunities,” Gass explained. “We take advantage of our past strategies and increase our marketing investment in locations where competitors close stores.”
Twenty-four retailers – including Stein Mart, Pier 1 Imports, JC Penney, Sur la Table and Neiman Marcus – have filed for bankruptcy by 2020, according to S&P Global Market Intelligence. And more than 6,000 permanent store closures have already been announced, Coresight Research said.
The unrest makes the strongest retailers in the sector even stronger, as they gain market share and lose customers, while leaving the weakest companies even fewer, analysts say.
Kohl’s thinks it will be able to capitalize on these billion-dollar stock options for billions of dollars, as its stores offer a wider range of merchandise, beyond just clothing, which includes toys, workout accessories and electronics.
“We have a game book that we have used in the past at a very localized level to go to those customers, acquire new customers and go to that market share,” Gass said Tuesday morning. “That’s when we started implementing the strategy for us.”
Kohl’s shares fell more than 15% in intraday trading after the company said sales fell 23% during the fiscal second quarter, in large part because the pandemic forced it to close its stores for 25% of the quarter closed. The company also offered a grim outlook for the rest of the year, saying the back-to-school season was off to a “soft” start.
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