Kohl's Gets It Right

There are a couple sweet spots in retail: Catering to high-end customers with expensive goods and excellent service, like Nordstrom (JWN); or offering appealing brands and a pleasant customer experience at lower price points, like Target (TGT).

Kohl's (KSS) has embraced the latter recipe for success.

We often buy stocks because of what we believe a company will achieve in the future. But what I like about Kohl's is it's not just a tomorrow play. They're getting it right today.

The company's expansion plans, cost controls and fashion sense make Kohl's one of the most enticing retailers in the department store space.

Getting It Right Today

According to a survey by advisory firm Retail Intelligence Group, Kohl's, along with Nordstrom and Federated Department Stores'(FD) Macy's, are taking market share in the women's apparel space from Chico's FAS (CHS).

"Macy's and Kohl's are the big winners in this marketplace, given their superior values and solid mix of merchandising, store atmosphere and inventory management," says Retail Intelligence Group's Derek Noce.

Of the women who responded to the survey that they were shopping at Chico's less, they said Macy's, Kohl's and Nordstrom were the top three stores that they were shopping at instead.

What's interesting is that Macy's and Nordstrom are generally considered to be in a higher-end category than Kohl's. So it can be inferred from this survey that Kohl's is starting to see a higher-income buyer.