This baby is going down the tubes at an ever faster speed.
Sears Holdings, after warning in March that “substantial doubt exists” about its ability to continue operating as a “going concern,” rubbed salt in those doubts in its second-quarter earnings report.
Quarterly revenue plunged 23% year-over-year to $4.37 billion.
It says $770 million of that $1.33-billion plunge was a result of the endless series of store closings with which Sears is trying to keep itself out of bankruptcy for as long as possible.
In its fiscal year 2017, it already closed about 180 stores and expects to shutter an additional 150 stores in the third quarter. Those closings had been announced previously. But in its earnings release, it announced the closing of 28 more Kmart stores “later this year.” Liquidation sales will begin as early as August 31, it said.
The rest of the plunge was caused by same-store sales (sales at stores open longer than one year) which dropped 11.5%. “Softness in store traffic” the company called it. But the trend is falling off a cliff: In Q2 2016, same-store sales had dropped “only” 5.2%. Now they’re plunging at more than double that rate. Despite the ceaseless corporate rhetoric of operational improvements, this baby is going down the tubes at an ever faster speed.
How does that $4.37 billion in revenues stack up? They’re down by nearly two-thirds from Q2 2007. This is what the accelerating revenue shrinkage looks like:
In the press release, Sears CEO and hedge-fund owner Eddie Lampert made another bad joke at shareholder expense, when he was quoted as saying:
“We are making progress on the strategic priorities we outlined earlier this year and remain focused on returning our Company to profitability. The comprehensive restructuring of our operations is delivering cost efficiencies and helping drive improvements to our operating performance.”
So let’s see…
Over the past three years, the momentum of the revenue decline has accelerated sharply. Q2 revenues have plummeted from $8.0 billion in 2014 to $4.37 billion in 2017. A decline of $3.6 billion, or 45% in three years. This chart shows Q2 revenues from 2014 to 2017, with the trend line (purple) extended until it hits zero. This is the same track that Q1 revenues are on. As I’d postulated three months ago, at this rate, revenues of the once largest retailer in the US will be zero in three years, or by 2020:
Zero is the inevitable result of a hedge-fund strategy of asset-stripping and cost-cutting at a retailer that had already been struggling before the takeover, and that now finds itself embroiled without effective online strategy in the American brick-and-mortar retail meltdown.
But revenues won’t drop to zero. Sears won’t last that long. A bankruptcy filing in the near future is becoming inevitable as creditors and vendors are getting very edgy. Some vendors have now stopped supplying Sears, according to Reuters, fearing to be left holding the bag in a bankruptcy and unwilling to pay the high costs of insurance on their Sears receivables.
And nearly everything got worse. Gross margin on merchandise dropped from 18.1% a year ago to 17.0%. In dollars, total gross margin plunged 23%.
But selling and administrative expenses fell only 7.8%. It was not nearly enough to make up for the plunge in gross margin. A big retailer cannot cut itself to health; it can only cut itself to death.
But Lampert added bravely:
“We have also continued to achieve significant progress in our restructuring program announced earlier this year, with over $1.0 billion in annualized cost savings actioned to date. Actions taken to date to realize $1.25 billion in annualized cost savings have included simplification of the organizational structure of Sears Holdings, streamlining of operations, reducing unprofitable categories and the closure of under-performing stores.”
All this cost-cutting and inventory-slashing is glaringly obvious to the few souls still wandering into a Sears or Kmart store. And yet, the company still lost $251 million in the quarter.
To keep this death spiral going for a little while longer, Sears sold its Craftsman brand to Stanley Black & Decker for $900 million. It also was able to raise about $460 million this year from real-estate deals. And it is still finding entities, including Lampert’s own hedge fund, that lend to the company, but these credit facilities are secured by properties that Sears still owns, and in a bankruptcy, these creditors are likely to walk away with what’s left of the banged-up crown jewels.
How long can Sears hold out? In fiscal 2016, it lost $2.2 billion, after losing $1.3 billion the year before. It has reached the phase where it’s burning the furniture to heat the house.
In America’s brick-and-mortar retail land, PE firms win again. But in bankruptcy court, stiffed creditors are not amused. Read… Brick & Mortar Retail Meltdown Fueled by Asset Stripping. Details Emerge in Bankruptcy Courts
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I’m going to really miss walking into Sears and almost buying something.
That’s exactly my experience.
Our midsize mall had 3 anchors: JC Penney, Sears and Macy’s.
Last year we lost JCP and M.
I assume Sears will be cut this year.
Then the mall will be dead.
john,
Have you been to that Sears store recently? How is it doing, now that the competition has left?
As sad as the downfall of Sears will be, it isn’t not well deserved.
Their late-adoption of establishing a large online presence and being attached to shopping malls acted as the 1-2 punch for Sears. I almost gave up on shopping malls, and thus Sears around the time I graduated from high school (05).
Then in college I worked in a shopping mall for five years, and that is what killed it for me – and based on Sears’ traffic numbers, is what killed it for them too.
Last time I was in a shopping mall in the US, I found it predominately populated with five distinct groups of people:
1) Teenie mall rats, who have no money, no intention to buy anything save a pretzel and just go there to hold their teenie GF/BFs hand;
2) Inner-city thugs, who like the mall rats have no money and no intention to buy anything. Because none of them have a job, they use malls as a people watching opportunity which is air conditioned with close proximity to slushies and cheap food. If they happen to accidentally walk off with something that doesn’t belong to them, well, that happens too;
3) Hispanic families. Like the thugs and mall rats, they too have no money and have no intention to buy anything save food for their kids. I found these people are seasonal — they only come for the free air conditioning or the free heat. They don’t come one or two at a time, but rather a good bakers dozen all crammed into a mid-90s Ford Explorer. They traditionally congregate in the food court for hours at a time. Tables close to electrical plugs are at a premium;
4) Old people wanting to get out and walk. Can’t say I blame them, free air conditioning, free heat and if you happen to have a Barnes and Nobel in your mall, well, guaran-damn-tee you the above three groups won’t be there, so the old people go. Like the other three groups no one has an intention of spending any money and use it predominately as a social opportunity; and
5) Middle-class families in their 30s to 40s. Traditionally middle class seeking to purchase something from a store one can only find in a mall. Mom needs to buy little Timmy that new Hollister Co. T-Shirt for $45, you’ll find them there. Need a multi-colored glow-in-the-dark liquor flavored penis for a bachelor party? Yeup, Spencers has one. These customers normally go in, get what they need and leave. There isn’t much meandering.
And so the malls, and thus Sears are dying.
To be fair, what killed the mall and Sears by extension in my opinion isn’t/wasn’t their prices or horrible customer service, nor was it Amazon. Look, Best Buy is still around.
I think what killed Sears (and malls) is their clientele. Sears is a relic that should have died with White Flight in the 60s and 70s but had enough cash flow to keep itself going. When the inner-city black population began shopping and working at Sears in larger numbers the white and asian customers went elsewhere. Then came their late adoption of the internet and it was game over sometime in the 90s.
I remember as a kid in the 90s in Atlanta my dad and I were doing our first home surround sound system. We wanted to get some bookshelf speakers and went to Best Buy, Circuit City (RIP), HiFi Buys (RIP) and Sears. We were in there only a few minutes, when the guy who was supposed to help my dad couldn’t speak English and relied on Ebonics. Told my dad he “didn’t know shit” about “dem’ speakers” but if he buys some let him know because he wants his commission. We left, didn’t buy anything and that was the end of my dad’s relationship with Sears.
All this to say, its dead … a goner. The lifespan of the chain should be measured in quarters at this point and no longer years.
If Sears wanted to save the brand, they’d file for Chapter 11 bankruptcy, liquidate their stores and aim for the clientele that made them great almost 100 years ago — middle to upper-middle class families. That being said, I have a distinct feeling Sears along with many other institutions is going to get sacrificed on the alter of multiculturalism and diversity and it’ll die; like Detroit; never to return in any meaningful way.
Sears here in BC, Canada, no Hispanics, no thugs, no Ebonics, no Blacks needing same, sooooo, I guess there is some other explanation for the problems.
Like perhaps, North America having 400 % per person of the retail space of Europe.
Oh, we DO have the teen couples doing a cheap walk- about but I don’t blame them for the town (Nanaimo) being grossly over- stored.
The racial stereotyping is rather thick on this thread. It wasn’t inner city thugs and immigrant Hispanics that raided the assets of mall store chains and left them with piles of unpayable debt that are have been forcing them into bankruptcy and/or being liquidated. Second, most of these malls that are getting decimated are located in white suburban areas. I don’t think Helena, MT, Muskogee, OK, or Huntley, IL are bastions of inner city ghetto hooligans, yet all of those places have dead or dying malls.
But back to the topic at hand. I saw the writing on the wall for Sears over a decade ago, as they were losing market share on the low end to Walmart and Target, they obviously weren’t going to compete on the high end with the likes of Saks Fifth Avenue, Bloomingdale’s, Nordstrom’s, or Neiman-Marcus, they were losing their competitive edge on appliances and tools to Home Depot and Lowe’s, and they obviously were going to lose to Amazon, which at the time was only an 800-pound gorilla in the retail space and not the massive horde of tyrannosaurus rexes it is now. I thought back then they should have closed up shop and at least held on to their real estate holdings and their licensing of Kenmore and Craftsman Tools. But it appears now they’re going to lose everything.
Haus – Now I want to go tomorrow to my local big-ass mall (I’ve never been in), just the light rail to the #23 bus, free A/C and people watching, it’ll be a hot, hot day with a heat advisory …. I could probably bring my lap sketch board and do crappy drawings of people and make it last all day. A trip up to The City would cost me $20 but the mall would only cost me $6.
I don’t go but I asked: It’s empty. The entire mall is empty. The small stores are leaving. Sad really. On holidays the even shut the mall ??? I don’t give it 2 years if the mall owner is leveraged.
John:
Maybe your mall will some day be feautured on Dan Bell’s Dead Mall Series..
My home town in central Washington state lost Mervyn’s, People’s and The Bon Marche back in the early 2Ks. The mall closed shortly thereafter.
The 650,000 square foot structure is still standing, but it’s be empty, derelict, and deteriorating. I’ve thought about sneaking inside to take photos, but it’s very dangerous.
Sears remained open even after the small closed, but then it finally closed shortly after the automotive department shut down when it was revealed it was overcharging and/or recommending unnecessary repairs.
No one could say they didn’t see it coming.
For those unfamiliar with the Dead Mall Series:
https://www.youtube.com/watch?v=5lVRgUOV-Xo&list=PLNz4Un92pGNxQ9vNgmnCx7dwchPJGJ3IQ
Why is it dangerous? Is it physically falling apart or are there predators?
Another good “dead malls” site = http://www.deadmalls.com/
Wonder what these dead malls are doing to pension funds.
Marty:
Yes both. Strange goings-on, broken glass, etc, critters and creatures roaming about. It’s just not a safe place to be exploring the by-gone era of failed retail space.
The city police do a good job of securing the site, tho.
John,
You must live in Coos Bay, Oregon? Our Mall mimics your experience.
Lol. And I’m thinking about the fire sales at Kmart starting August 31. Honestly, they’d have to pay me to take that crap. Then I’d just go out and set it on fire. Maybe the fire sale should just be “we’re going to burn the Kmart, run in and grab whatever you want”!
I live in a rurul area, so I’m limited to kmart, macys (too expensive) and walmart (too many crazy people). Bought a towel from kmart about a month ago, probably not gonna make it to the end of the year – just completely unraveling. The garden center had just a handful of plants – all dead. Surprised its lasted this long.
Only reason macys is still in my area is because they own the land theyre on, otherwise the landlord of the mall its in would have jacked up the rent and sent them packing years ago. Lost a sears about 4 years ago and sports authority when they went belly up. Payless shoes too, and pier 1 is also not long for this world.
Kent, I would think that some of the appliances are still respectable, no?
NEVER buy appliances from Sears or Kmart They sold me a frig that was a lemon and reneged on the warrantee Never again I bought the replacement at the local PC Richards appliance store
I rented from a mega landlord who installed Kenmore in all their houses. The appliances were cheap but they worked. The washer/dryer combo was very energy inefficient and doubled my water bill. No matter what I washed the washer would fill up to the top.
I got two pairs of jeans for a great price at KMart last year. The KMart near my hometown in PA is actually pretty nice – and way less crowded than the nearby WalMart.
Look, I think this is all about one thing. Today it’s Sears, tomorrow it will be just about everyone. It’s about rents being too darn high. Both for the stores, cutting into their profits, and for the retail customer burdened by high cost of shelter.
Someday, we will see rents collapse. THEN, these stores will be profitable again, and customers will have money to spend again.
As for the so-called “Amazon”, it will be revealed as just a flash-in-the-pan. Drones my *ass.
Of course that collapse is racing towards us like a freight train Things that cannot be sustained collapse It’s inevitable and I can’t understand the simple mindedness of the landlords/goats to allow it to continue
Good point. I just hope that is what actually happens. The other possibility is too ugly to think about: permanently entrenched feudalism/third world. Don’t ignore this possibility.
PS. don’t get me wrong about Amazon. I think they’re great at what they do best: getting me rare books or hard to find specialty items. The rest is just hype.
As ably pointed out in this website, the whole retail sector is going down. Why?
I do not think that the majority of Americans have lost their love of the experience of shopping at a beautiful shopping mall. I have been told by friends that they no longer take their families shopping in malls due to the need to save money.
This limiting or dropping of one of the humble pleasures in many American’s lives indicates that Amazon’s victory is caused not just by convenience but by the sad, dire situation of most Americans, who have less and less income. I think this will continue or worsen.
Part of the reason for the decline in mall shopping could very well be a combination of:
– Netflix (and other similar streaming services)
– Facebook and other social media
– General high-speed internet (for entertainment)
– vast proliferation of cable TV and DVR (or cloud) services for on-demand and time-shifted viewing
Why?
Mall shopping 30-years ago (think of ‘Fast Times at Ridgemont High’) was in large part a form of entertainment and social contact.
Today much of both (and particularly when you include watching something on TV and going to Twitter in real-time to socialize about it) is done at home, and much more effectively.
No more going to the mall and hoping to see your friends there .. or going there and being rejected for who knows what reason. Social contact via the internet is nearly instant and if you don’t fit in at one location due to your mood or the mood of those there, you quickly find some other spot.
Relate this as well as when you need to buy something “at the Mall” … you can take the time to get there and back (call the 30 – 60 minutes round trip), endure the cost to do that (by car or bus), etc etc …. or you can spend a few minutes, buy it on-line and have it in a day or two or three and spend your time doing other things.
Mike and Rick – If there’s one thing these hard times have taught, it’s that if you go out, you’re *going* to spend money. It may be only $2 for a coffee or some sort of a drink but that’s $2 that you regret the hell out of spending. So the solution is: don’t go out. Have staple foods at home and if you can, a garden, even chickens, and you can avoid going out any more than necessary.
And I’m using the hell out of Amazon and it’s great.
TV what’s that?
Wolf,
You called this some time ago. It certainly unwinding fast.
Sears gambled many years ago that they could drastically lower the quality of their merchandise and still retain customers. They lost that bet.
My only hope in all of this is that whatever real estate Sears has left gets liquidated with the proceeds going to all vendors, not just Lambert. Though I’m sure he’s found a way to put himself first in line.
I’ve said this before, a lot of that real estate was built 40+ years ago and is no longer quality real estate. With I’m sure a few important exceptions in some major cities.
Sears has already sold off most of its prime real estate and is now leasing back those stores — the ones that they haven’t closed. The last big part was sold in July 2015. The buyers were related parties, and these deals didn’t pass the smell test. But the “fraudulent conveyance” provision of the bankruptcy code have a claw-back period of only two years. So if Sears files for bankruptcy now, Lampert and buddies are likely in the clear and get to keep their goodies.
Bingo- this was the fall-back plan all along. These guys are smart enough to know about the two year period, and take action prior to that. As you said, it looks like they have already done so.
Lampert’s speeches about being committed to becoming a great retailer have been exposed for what they are/were(he said that MANY years ago now- and it’s a joke or forgotten).
Reminds me of Gil Amilio making all of his brave announcements at Apple (again most have forgotten). The statements were ridiculous in the sense that he had no idea how to correct things at Apple.
Lampert and his pals never had any idea how to run a retailer. American CEO business skill? Asset stripping apparently is the main skill now.
Yes as we Expected/Predicted.
IMHO The fraudsters will seek to put as much “air” as they can between the July date and the filing. To lessen the stench of the real-estate sale leaseback deals..
Possibly by increasing their debentures further, which will give them even greater control of the new entity/Spoils.
Only in America land of legalised fraud, can this be allowed to progress to this point, and beyond.
Bye bye Sears – Bye childhood memories – Hello empty stores – I think I’m gonna cry – I think I’m gonna cry .
sigh …………
Note to self: avoid Craftsman, it’s now Black and Decker.
A few years ago a saw a Craftsman wrench in a friend’s shop that looked like it was made in a shack in India. A true disposable tool. But, there are the same American factories producing the same tools, just under other names like Bulldog and such. Klein tools are still made here, and they sell ’em in Home Depot which amazes me. I just bought a set of chisels branded Stanley, and made in England. England?? They look like very well made “only have to buy ’em once” tools.
There are still tons of Craftsman tools out there in garage sales and flea markets, and most people don’t need tools of the quality of Snap-On or MAC. Craftsman or even Kobalt are fine.
Stanley.
Was originally and English brand, prior to the great US asset strip, of England and Europe.
they owed us for the war
Eddie Lampert talks better than he manages a retail business. And he doesn’t manage that retail business very well at all.
A suggestion: Close all but one store, so the operating expenses go way down. I know the revenues will go down, too, but it’s obvious even he doesn’t care about those. Then he can move all the inventory that they still have to that one location, where it can be marketed by the one employee that will still hang around to try to sell it.
This plan may not occur to him, but the way he manages the business, it may be what he gets.
I’ve read that he typically goes to the Sears headquarters only once a year – for the annual shareholder meeting. He probably hasn’t been inside a Sears or Kmart store in decades if ever.
Back in the day when I got my MBA, the hot thing was “managing by walking around.” Good managers had always done that, it just took a while before it was inducted into the official cannon of MBA lingo. Lampert certainly hasn’t figured it out, in part because I don’t think he ever WANTED to manage a retail giant. He wanted to engage in asset stripping and financial engineering and he saw all this real estate, and his mouth began to water.
Canon, Wolf, not “cannon” sheesh.
:-]
Cannon has a certain charm and nuance, don’t you think? Just make sure to avoid the projectile and the recoil. LOL
You’re right. He thinks he can run it as an armchair exercise, like a passive investor or video game.
Exactly what I thought many years ago. I think Sears may have been able to survive somehow without a destructive CEO like this, but it’s too late now.
Another bad thing about any “sudden” bankruptcy is the huge number of employees that will hit the unemployment stats. Sears employs tens of thousands (>100,000?). That number of new unemployed could literally ripple all the way through the economy.
I think what Wolf may have been saying that he was never going to run the business, armchair or otherwise. He wanted to asset strip all along. That’s what I think. He never intended to manage Sears to success in retailing, but to figure out how to strip as much from the company as possible.
Wolf, is the real estate that Lambert liberated from Sears really worth it? I mean, there’s too much retail space and they are retail, right? Or did he already cash out enough with the Sears REIT?
“He wanted to engage in asset stripping and financial engineering and he saw all this real estate, and his mouth began to water.”
The Fact that he took over Sears, and did not make it successful, by returning it to its roots. Mail supply (today by Internet order) of good quality products.
Which was possible then.
Suggest very strongly, your allegation’s have much foundation, in Fact.
Read an article today that Sears is now buying merchandise from wholesale liquidators as other vendors are worried about getting paid. LOL
Man, when I was a kid Sears was the shit. Kenmore appliances, Toughskins jeans, I had a Silvertone guitar, we got all kinds of stuff at Sears. Everyone did. And being in Hawaii, we were considered “rural” or something and often things had to be ordered and then picked up “six to eight weeks” later.
Oh well, lots of things used to be the shit in the 70s. Skateboarding barefoot, learning to siphon gas, going around at age 12 with an honest-to-goodness US Marines Ka-Bar knife, cyclamates…
Can’t blame Lampert for not setting foot in the stores. Imagine how depressing the experience would be, even for a potential shopper.
Is there any more to gain for Lampert at this point? What’s keeping Sears from filing for bankruptcy now?
Meanwhile, investors have pulled $30 billion from the Wall Street-Federal Reserve pump & dump over the past ten weeks. Looks like Da Boyz are stealthily exiting the rigged casino with their winnings before the Fed’s Ponzi markets and asset bubbles implode under the weight of their own fictitious valuations and fraud.
https://www.cnbc.com/2017/08/25/investors-pull-billions-from-us-stocks-in-longest-streak-since-2004.html
I’m sure someone like Lambert saw this whole change happening in the retail environment 20 years ago. Sears was looked at as a tax haven. It wasn’t a question of making Sears profitable. The “turn-around” publicity was just idol talk for the media. It was a strategy of capturing the Sears part of the slow moving train wreck that is brick and mortar retail in general, and maximizing profits and tax losses. The likes of which he’s done a good job.
The question is, what about other big retailers, hotel chains, or now out-of-date restaurant chains. We know what’s going to happen with Sears/Kmart. What about the likes of the big top priced grocery retailers? Pick N Save, Piggly Wiggly, Shaws, Tesco, Sainsbury’s, Ralphs, Stop N Shop, just to name a few. Most are already looking dated. Any predictions as Lidl, Aldi, Amazon, dollar stores, swoop in and piddle on their profits?
What I think Eddie’s strategy was involved bankrupting Sears slowly while his hedge fund acquired the real estate leases and or the property outright. Why? Sears had very long-term leases on these properties are very low rates.
Once Sears left the property, the lease agreement could be sold or rented out at a much higher rate.
What went wrong? .. the death of the Malls inside the US. In other words, JCP, M, KSS etc …. these suffer from the AMZN impact which was not seen 15-years or so ago. Eddie thought the loss of one anchor store in a mall would open up that space to a higher paying customer … but loosing most anchors is catastrophic.
While these spaces are slowly being converted to other uses (amusement centers, office complexes, etc), many have not.
The cost to try to bring Sears back to life would be huge (certainly more than he can afford and no creditor would risk that) … just look at how others have attempted to turn around to combat AMZN (JCP is a good example).
Some just this last quarter may be succeeding (think Best Buy) but for Sears/KMart it is way too late.
The other item which Eddie L. was banking on is the customer data (Shop Your Way).
Perhaps that could have worked when Sears had a true loyal customer base, but I am at a loss to see the value today.
Reading the horror stories of how that was implemented in the stores (data entry delays at the register etc) could very well have been partially causal the the end of Sears.
BTW – personally I was a loyal “Craftsman” tool customer, but my experiences in the past decade has driven me to Home Depot.
Sears personal data system is a mess. I found out how bad it was in an interesting way. After moving to a new state we needed a new BBQ and shopped a sale at Sears. They asked for our phone number to check our account and we supplied it. We were informed that we could get an additional credit on our sales price due to available points. We thought that was great and paid for the BBQ in cash.
Once we got home, we started talking about how long it has been since we last shopped at Sears. So long we couldn’t remember. Then we realized the phone number we gave them was a new number. When I looked at the receipt, it had a guy’s name and address we didn’t know. We must have his old number and got his Sears points. So much for Sears’ customer data collection system.
Perhaps I may be proven wrong, but my sense is that we are facing a global downturn, a financial crisis, an inescapable run-in with energy returns on energy invested approaching 1-1, and sclerotic, ineffectual governments all around the world. The idea that “brick and mortar” is both bad and passé while globalized systems based on cheap fuel, functioning credit markets, just in time deliveries, and a robust power grid functioning in a hunky-dory manner is not credible. It will be tough enough in the future for trains to deliver goods to hubs which many will struggle to connect with. The future is going to be more local, more physical, more immediate. Prepare accordingly.
James Levy – this is why I have a very pessimistic view on AI, robotics, self-driving cars, yadda yadda. All of this takes an metric fuckton of energy to build, to run, to repair … Meanwhile a human being runs on 250W and can use anything from mangelwurzels to maggots for fuel.
There’s no way a robot is as efficient as me on my bike. There’s no way that robot can figure out Oops it’s a construction zone/accident/crime scene and hoick the bike up on its shoulder and climb over some stuff.
mangelwurzels … That is a new one to me, I looked it up … Doubt I will find one in my local store … Perhaps I need Amazon Pantry for that.
Sears closing near me is stuffed with garbage from someplace that no one wants .The good stuff is barely marked down .I asked when the final day was? They said when they sold out , at the rate they are going it is going to be months .
Sears was my store. I spent a lot of money with them over the past 20 years, and would have bought more had they not closed up all stores within 100 miles of me.
And now Google got into the fight too as
partner of Wal-Mart, only people doesn’t tend to google for food… or do they?
Is gonna to be fun taking advantage of the price drops while they last, then not so fun dealing with the surge pricing of however wins.
Supposedly a share of Sears from 1987 did really well if someone added the value of Sears and all its spin-offs (Allstate, Dean Witter aka MS, etc).
Anyone did the math?
a hundred years ago Sears revolutionized shopping with their catalog, then came the catalog store. you could get anything, even a house delivered (okay Bezos put that in your drone) and not much has changed except the delivery system. retailing now eschews the house brand, and change makes you wonder how the supers will manage that type of change, trust in food is paramount. maybe Sears was TOO American to compete with Chinese prison labor, sigh.
A lot of American brands use chewp labor so you are mistaken. What happened is that as you said Sears started a hundred years ago and both society and technology changed. Do we still use the telegraph for anything but naval communications? Adapt or die, and Sears didn’t adapt.
When even Wallmart is barely mqking profit you know chain stores is a dying market.
People is lazy and buying online is better that ordering junk that you see on TV by phone.
I have to say before i met my wife sears what not a big deal to me.After we were married she bought all our appliances from them we did very well.Many years back they came up with a plan to repair any and all appliances in your home it was so cheap it was crazy we got more stuff fixed so cheap it was great, that lasted about 2 years or so till they realized they were taking a beating. My dad used to say their tools were junk but that did not seem to be the case to me.I will be married 50 years in sept so we go back a long way.Do not forget their mail order houses i have seen a few in last couple of years and they are still standing. On a happier note sheriff joe is free and rachal madden will have a nervous breakdown.
The GOP is having a bunch of nervous breakdowns.
Rachael Madcow(Maddow)
Hopefully real estate prices will crater before Eddie can cash out. That would be karma.
Plainly, the strategy for Sears is to “Uberize” (it will become the Sears Has Indoor Toilets Unicorn):
o An Uberfication would be EXPECTED to burn cash; just raise your hand when you need more
o Apparently, office parties are exceptional!
o Current Sears employees speak English better than, well, Uber employees…
o You don’t have to ride off in a dark car with someone you’ve never met (I mean, unless you want to…)
o No tipping
Something on-line has done is enable manufacturers and producers to sell direct to the public, instead of via a retailer. Manufacturer producer profit margins have always been lower than retailer margins so it makes sense to cut out the retailer whever possible.
Customers use shops like showrooms. Browse in the shop then go home and buy it on line direct from the manufacturer. Not always cheaper but some some things longer shelf-life and at least if there is a problem the manufacturer will resolve, unlike the retailer that quibble and probably have gone bust.
ML that’s very true and it’s a lousy business model