Shoppers walk in front of a Kohl’s department store in Mount Kisco, New York.
Scott Mill | CNBC
Kohl’s said Tuesday it is working with the owners of Babies R Us to supply baby products, furniture and more to about 200 stores nationwide.
The retailer has a deal with WHP Global, a brand management company whose portfolio includes Bonobos, Joe’s Jeans and Anne Klein. Neither company disclosed terms of the agreement.
The first Babies R Us store will open this August and expand to additional stores in the fall, Kohl’s said in a news release. Kohl’s said the stores will range in size from 750 to 2,500 square feet and will add more brands and merchandise to the Kohl’s baby category. The retailer said the new store will be located next to its existing baby merchandise, which includes apparel and merchandise from Graco, Carter’s and Fisher-Price.
With this move, Kohl’s adds another potential growth driver to its stores. Under new CEO Tom Kingsbury, the former chief executive of discount chain Burlington Stores, the company has been trying to reverse declining sales, attract more foot traffic and attract Young customers. Former Kohl’s CEO Michelle Gass left the company at the end of 2022, ultimately taking over the top job at Levi Strauss after intense pressure from activists and a failed sale to The Vitamin Shoppe owner Franchise Group.
Kingsbury said in a press release that Kohl’s is committed to driving growth through a more relevant merchandise mix. He said Babies R Us is an example of the company’s plan to “further establish Kohl’s as a brand of choice for families.”
A shopping cart is parked in the parking lot of a Babies “R” Us store on January 24, 2018 in Chicago, Illinois.
Scott Olson | Getty Images
Like Babies R Us, Kohl’s has a deal with Sephora to open beauty shops in hundreds of its stores.
WHP Global has a similar agreement macy’s department storethe company has opened Toys R Us stores in many of its stores.
Kohl’s shared the news as it reported holiday quarter earnings results. The retailer’s holiday quarter profit and revenue topped Wall Street expectations, but its net sales fell 1.1%. Its comparable sales, a measure that excludes the impact of store openings, closures and renovations, fell 4.3%.
Kerr gave conservative guidance for the year ahead. The company said it expects full-year net sales to fall 1% to grow 1%, and comparable sales to be flat to grow 2%. Earnings per share are expected to be in the range of $2.10 to $2.70, excluding any non-recurring charges. This will be down from $2.85 in the previous fiscal year.
During the holidays, Kohl’s revealed its plan to turn a profit. The company has expanded its assortment of pet merchandise, home décor and impulse and gift items to drive sales. It relies on in-store Sephora stores to attract shoppers. It also clears space at the front of the store to make popular and seasonal items more prominent when customers walk into a location.
As of Monday’s close, Kohl’s shares have fallen about 5% this year. That lagged the S&P 500’s gain of about 7% over the same period. Kohl’s shares closed at $27.19 on Monday, giving the company a market value of $3.01 billion.
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