MILWAUKEE — Kohl’s, which has been expanding outward from its Midwestern base for the last decade, will become a true national chain in 2003 when it ventures west of the Rockies for the first time and opens a total of 20 stores in Los Angeles, Las Vegas and Phoenix, said R. Lawrence Montgomery, the chain’s chief executive officer.
“We can’t wait,” he said. “We’re counting down the days.”The Los Angeles stores will open next spring, while the Las Vegas and Phoenix units will follow in the fall.?Montgomery added that the company recently built a distribution center in San Bernadino to service the new stores and is currently hiring and training key personnel for what is expected to be a major expansion by the Menomonee Falls, Wisc.-based moderate department store chain to the West Coast.
Kohl’s also plans to open another 110 stores in existing and contiguous markets over the next two years, bringing its total to just shy of 600 units.
Montgomery’s remarks came at the company’s annual meeting, which was held Tuesday at the Midwest Express Center in downtown Milwaukee.
In a review of operations, Montgomery said the company continues to be on the lookout for moderately priced apparel brands that can be expanded across numerous categories. An example is Columbia sportswear, which the chain introduced two years ago and now features in women’s, men’s and children’s.
?Montgomery also singled out such recent introductions as Nine & Co., Jantzen and Oshkosh children’s wear as having potential for expansion.
Kohl’s current top-10 brands — which account for 20 percent of total store sales — are Adidas, Columbia, Fieldcrest, Haggar, Lee, Levi’s, Nike, Reebok, Sag Harbor and Villager, a Liz Claiborne label.
At an informal press conference after the meeting, Rick Leto, Kohl’s executive vice president and general merchandise manager, said the chain had no plans to pursue an acquisition along the lines of Sears’ recent purchase of Lands’ End.
“That’s not the way we do business,” he said, before going on to label Sears’ deal an act of “desperation.”“Stores do things like that when they don’t have a developed apparel business and need a quick fix,” he said.Leto also extolled the virtues of small buying staffs, saying that even though sales have almost quadrupled over the last six years, Kohl’s has added only 10 new buyers for a total of 54.
Last year was Kohl’s 10th anniversary as a public company, and Montgomery cited statistics to demonstrate the chain’s rapid growth during that time.
l Revenues over the last decade have grown by about 23 percent a year and last year totaled $7.4 billion.l Earnings — which last year hit $496 million — have done even better, growing by almost 33 percent annually. l Comparable-store sales over the last decade have increased 8.4 percent a year.
l A $1,000 investment in Kohl’s stock in 1992 would now be worth $37,000.