Department stores such as Korvette’s in New York, and later Kmart, Wal-Mart, and Target, disrupted full-service department stores. The discount stores made money by accelerating inventory turns to five times per year, which enabled them to earn attractive profit with 23 percent gross margins. Because their salespeople were much less knowledgeable about products, at the outset the discount department stores had to start at the simplest end of the merchandise mix, with branded hard goods that were so familiar in use that they sold themselves. They subsequently have moved up-market into soft
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