USA: Kmart To Spend $2bn On Infrastructure Upgrade
Kmart Corp chairman and chief executive Chuck Conaway outlined the retailer's three most important strategic imperatives during a meeting held yesterday with the financial community Chain Store Age reported today. The details come at an important time for the company, which is striving to improve its financial status and competitive edge. Conaway said that Kmart would improve its retail execution by making effective end-to-end improvements and investments in its supply chain. The company plans to spend $2bn to update its infrastructure through August 2002. The funds will be used to upgrade the retailer's technology processes and change management capabilities and systems over the next 24 months. All Kmart stores will have updated scanners by October, with 1,600 stores receiving the most state-of-the-art scanners available. New POS registers will also be installed in every Kmart store by August next year. Through these upgrades, Conaway hopes Kmart can increase the speed of the customer checkout by at least 20 per cent. The chain will also create a customer-centric culture to ensure that the day-to-day activities in its stores are geared toward satisfying customers. Lastly, Kmart plans to become a marketing- and sales-driven organization. To enhance its customer service, Kmart will begin operating a new customer-service centre in October that will be available around the clock every day. The chain will launch a customer-service measurement system that uses a voice-response system to provide direct feedback. Lastly, Kmart will reduce the span of control for its district managers, from roughly 13 stores to 8 stores each.
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