Department stores like Kohl's Corporation (NYSE: KSS) and Macy's Inc (NYSE: M) suffer from "self-inflicted wounds" and simply can't compete against the likes of Amazon.com, Inc. (NASDAQ: AMZN), according to CNBC's Jim Cramer.
Kohl's and Macy's need to offer consumers a shopping experience that can't be duplicated online, Cramer said on "Mad Money." The two department stores have nothing special to offer customers and they have themselves to blame. After all, Target Corporation (NYSE: TGT) and Walmart Inc (NYSE: WMT) deserve credit for fighting off the threat from Amazon.
What Do Macy's And Kohl's Offer?
So what do Kohl's and Macy's offer customers? Higher prices, a poor online shopping experience, long lineups at the checkout counters and sloppy aisles, Cramer said. The department stores simply "can't afford to be run efficiently" anymore and customers are complaining online.
While business is struggling, Kohl's and Macy's have been taking on new debt over the past few years to finance their large stock buyback program, Cramer said. The companies would have been "better off" just sitting on the money or "much better off" investing in a stellar online presence.
All of the problems department stores are facing today are merely accelerating, Cramer said. As each year passes, the problems "gets worse and worse."
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Photo credit: MB298, via Wikimedia Commons
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