Kmart is closing its last remaining store in Chattanooga.
The discount retailer, which once operated more than a dozen stores across Southeast Tennessee, will shut down its Hixson store on Highway 153 by the end of the year. The closing is among 64 stores being closed across 28 states as Kmart continues to streamline its operations.
Kmart closed its 25-year-old Kmart store in Cleveland, Tenn., in March and shut down other outlets in Athens, Sweetwater and Maryville, Tenn., in July.
Employees said the affected stores that are closing will close in December. Kmart officials said those displaced by the store closings will be eligible to receive severance and be able to apply for open positions at local Sears or Kmart stores. Most of the associates work only part time.
Kmart is also closing other Tennessee stores in Nashville, Memphis, Oak Ridge, Clarksville and Smyrna in Tennessee, but Kmart will continue to operate 16 stores in Tennessee and 19 stores in Georgia.
In Northwest Georgia, Kmart will continue to operate three locations in Dalton, Ga., and a store in Fort Oglethorpe. Kmart also will continue to operate stores in Tullahoma and Crossville, Tenn.
Moody's analysts who downgraded their rating for Sears Holdings company last week warned that Kmart may not have enough cash or access to cash to stay in business. Kmart has about 870 stores today, down from about 1,300 in 2012.
"The ratings... reflect our view on the uncertainty of the viability of the Kmart franchise in particular given its meaningful market share erosion," the Moodys analysts wrote.
Sears reported last month a second quarter loss of $395 million compared to net income of $208 million in the second quarter of 2015.
"We continue to face a challenging competitive environment andwe continue to focus on our overall profitability, including managing expenses," Sears CEO Edward Lampert said in the company's latest quarterly report.
The 116,325-square-foot Kmart store at 5380 Highway 153 was built in 1994 to replace the Hixson Pike Kmart that now houses an Uncle Bob's storage facility. But since its opening two decades ago, the Hixson Kmart on Highway 153 has captured only a fraction of the business of its rival Wal-Mart superstore just a couple of miles down the road.
Sears owns the soon-to-be-vacant retail facility, which is valued by the Hamilton County Assessor's office to be worth more than $3.3 million. Sears Holdings has yet to indicate its plans for the Highway 153 property.
Liquidation sales of some of the merchandise in the Kmart stores to be closed is expected to begin on Thursday, employees told Business Insider.
Contact Dave Flessner at dflessner@timesfreepress.com.