Little Caesars talking with Kmart despite retailer's woes

July 14, 2002

DETROIT -- Little Caesars, which is registering improved sales company wide despite the loss of 98 Little Caesars pizza stations inside Kmart retail stores earlier this year, is in negotiations with Kmart to keep other locations open.

According to Crain's Detroit Business, Little Caesars Enterprises Inc., which operates 411 pizza stations at Kmart stores and offers products for another 923 Kmart cafes, is discussing extending contracts that expire in August.

Kmart is in the midst of bankruptcy proceedings that began in January. The struggling retailer in February announced it would close 284 of its roughly 1,700 stores in a restructuring move, a move affecting the 98 Little Caesars locations (See story: Kmart closure to affect 98 Little Caesars). Kmart recorded an 11.4 percent drop in same-store sales during May, according to Crain's.

Little Caesars officials told Crain's that it wants to continue the relationship despite the retailer's uncertain future. Kmart considers the partnership crucial to the company's future as it reorganizes.

According to Crain's, Little Caesars' same-store sales are up 11 percent over a year ago. Sales are up 14 percent at company-owned stores and 8 percent at franchise locations. Revenue figures were not provided by the company.

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