Why Americans hate Sears
Neglected stores, a sinking stock and beloved brands found elsewhere have turned shoppers and investors alike against the chain.
They hate it as a place to shop. They hate it as an investment. They hate that it hasn't changed so much as a doorknob or drop-ceiling tile in 20 years.
Michael Santoli, who writes for Yahoo Finance's Unexpected Returns blog, lays out his damning case against Sears by noting that even with 2,500 Sears and Kmart outlets and $40 billion in annual sales, revenue has plunged by 13.5% in the past four years.
Sears has already lost $247 million in the first quarter of 2013, an 8.8% drop from the same period last year. And its same-store sales have fallen for seven straight years, along with its American Customer Satisfaction Index score.
As Amazon.com (AMZN) beats Sears at its own catalog-style game and Target (TGT), Wal-Mart and even Kohl's (KSS) have helped drop Kmart store numbers by more than a third, Lampert operates what looks like an estate sale.
He has spun off Orchard Supply Hardware Stores (OSH), franchisee-run Sears Hometown & Outlet Stores (SHOS) and portions of Sears Canada in the past two years. He has treated Sears' remaining flagship stores in downtown locations, stand-alone lots and old malls like real estate holdings. Sears even gleefully lists its available square footage on the company's "realty" site, and it's listening to offers to subdivide its remaining stores.
Those holdout stores look as if they've been encased in amber since the 1990s, as Sears and Kmart spend a scant $1 to $2 per square foot updating facilities, according to International Strategy and Investment Group. By comparison, competitors like Target and Wal-Mart spend up to $8 per square foot painting, updating registers and replacing tiles.
In fact, the only items Lampert and Sears have taken the time to preserve are its Kenmore appliances, Craftsman tools, DieHard batteries and Lands' End clothing -- which have all been turned into a separate legal entity. The bad news? They're walled off so that Sears Holdings can use them as free-agent products, as it did two years ago when it allowed its coveted Craftsman tools to be sold at Costco (COST) and Ace Hardware.
When you show that kind of hate for your own stores, it's tough for your dwindling consumer base not to hate you back.
Take control of a multi-billion company, suck millions or billions in management and consulting fees for entities separately owned by management, and sell off the companies assets, all the while claiming that you're trying make Sears profitable again. It's a scam, which comes from an old playbook. It's just being done at a very high level and those who should be shining a light on the problem are either incredibly naïve, or benefiting in some way from the lack of criticism.
hate is a pretty stiff word. I don't hate sears and msn has no right to speak for others on an opinion that should be an expression of themselves. I didn't see a poll of how they came up with the word hate against sears. sears is a very old company that is falling to the side because of newer chains that have used sears' marketing procedures to tweak what does and doesn't work for todays customers.
their buildings are old and most people want to shop in the latest and greatest. I think sears needs to revamp and update every store they own to survive. I hope they do because they are classic and as a baby boomer I have fond memories of my mom ordering all of my clothes from the catalog.
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