In a recent Wall Street Journal article by reporter Miguel Bastille, the former Sears-Roebuck catalog store is slowly becoming the equivalent of a retailing ghost-town, as more and more customers decide to spend their money elsewhere. There have been very few improvements and modernization in its aging fleet of 2,200 full-line stores, and it has already closed 171 since merging with K-Mart under the new name of the flagship Sears Holdings Company in 2005. Interestingly enough though, K-Mart stores entered Chapter 11 bankruptcy proceedings before joining Sears but the same management team runs the operational activities of both companies. Unlike some of their competitors, Sears has been quite skimpy on spending money for renovation and capital expenditures whereas most of the larger retail chains spend $6-$8 per square footage but Sears spends less than $2 per square footage.
It is believed that hedge-fund billionaire Edward S. Lambert, who is majority stockholder, will eventually sell all the Sears stores for the real estate value. Sears has been steadily losing ground to competitors like Macy’s, Target, JC Penny’s and Wal-Mart and the Hoffman Estates IL company incurred losses exceeding 300 million dollars for the first half of 2011. The latest strategy for the struggling retail giant is to sell some of its most recognizable brands at the locations of its rivals. The thing is though; this is just speeding up the eventual demise of Sears because if consumers can buy these products at another store then why should they continue shopping at Sears? Ironically, K-Mart is known for offering the “Blue Light Special” on merchandise for Sale but as it pertains to Sears, “Will the last employee to leave please turn out the light?”
Robert Randle
776 Commerce St. #B-11
Tacoma, WA 98402
November 22, 2011
robertrandle51@yahoo.com
