It's hard to believe that Kmart was once a bigger retailer than Walmart (wmt).
But the discounter, which is a unit of Sears Holdings (shld), has been shrinking for years. It has struggled to compete with Walmart, which eclipsed it in size in the early 1990s, and other competitors that have begun to aggressively steal away market share.
Despite its parent company's efforts to overhaul Kmart and become less reliant on its brick-and-mortar operations, comparable sales last quarter fell 7.5%, continuing years of declines. So the company will close a "very small percentage" of stores in yet another paring down of the Kmart and Sears fleets. Sears declined to specify how many will stores will be shuttered.
"Each year we evaluate our store portfolio and make changes based on leases expiring or performance," Sears spokesman Howard Riefs told Fortune in an e-mail. "The store closures are part of a series of actions we’re taking to reduce on-going expenses, adjust our asset base, and accelerate the transformation of our business model."
In the last decade, Kmart has gone from 1,426 stores to about 952, while Sears has shrunk from 866 full mall-based store to just over 700. In addition to closing stores, Sears Holdings last year reinforced its dwindling cash reserves by spinning off some of its best real estate into an investment trust, reaping $2.7 billion. It has also sublet space at some locations, arguing that the Sears of the future will require less space.
Sears can take some solace that it is not the only retailer to be closing stores. Macy's, (m) facing declining sales after outperforming other department stores for years, is closing 36 stores and cutting thousands of jobs. J.C. Penney, on the rebound (jcp), is only closing seven stores, though it has shuttered about 10% of its locations in the last few years. Target (tgt) has also said it would close a few stores even as it expands its smaller urban locations.