November 20, 1997

Stephen Pagnani or Mary Lorencz
Corporate Affairs
(248) 643-1021

KMART OPENS FIRST BIG KMART IN DOWNTOWN OF A MAJOR U.S. CITY
The Gallery Mall location Kmart's sixth in the City of Philadelphia

Troy, Mich. - Kmart Chairman Floyd Hall and Philadelphia Mayor Edward G. Rendell today cut the ribbon and toured the first Big Kmart in the nation to be located in the central business district of a major city.

The Big Kmart is the newest addition to The Gallery Mall in Philadelphia. Accessible from both Market street and the interior of the mall, the 99,000 square-foot store occupies a former Clover site. The store will employ almost 300 associates.

"It's great to open the first downtown Big Kmart in what was the first downtown mall in the country. We are thrilled to bring the shoppers of Philadelphia this tremendous new store," said Floyd Hall, Kmart's Chairman, President and CEO. "Big Kmart is big, bright and easy to shop, with big value, big selection and big savings."

Big Kmart layout is designed to provide customers ease of shopping for their daily family needs and increase sales by focusing on three distinct merchandise businesses:

Home Fashions, includes both "soft" (towels, bed sheets) and "hard" (dinnerware, appliances) items often replenished for the home, and is placed near the Pantry area. The softlines side features the Martha Stewart Everyday Store-within-a-Store.

Children's Department, including children's apparel and toys. The Children's section is usually near Men's and Ladies Apparel. Frequently shopped items for kids are socks, T-shirts, underwear and fleece.

Consumables, items that customers come into stores on a regular basis to buy. Consumables areas are usually near the center of the store and include items such as health and beauty care, household supplies and over-the-counter drugs.

The Gallery Mall Big Kmart brings the Pantry to downtown Philadelphia -- the centerpiece of the consumables business. The Pantry allows shoppers to "stock up" on items they most frequently need to replenish, such as paper products, household and pet supplies, beverages and selected food items such as milk, bread, canned goods and candy.

To date, Kmart has converted all of its Philadelphia stores to the Big Kmart format. Nationwide, 637 Kmart stores now operate under the Big Kmart format.

In celebration of the Gallery Mall Big Kmart opening, Kmart is donating $10,000 to the Variety Club. Last year, Kmart associates raised more than $850,000 for charitable organizations in Pennsylvania.

In addition to six stores in Philadelphia, Kmart Corporation serves America with 2,116 Kmart, Big Kmart and Super Kmart retail outlets. In addition to serving all 50 states, Kmart operations extend to Puerto Rico, Guam and the U.S. Virgin Islands.