Why Americans hate Sears

Neglected stores, a sinking stock and beloved brands found elsewhere have turned shoppers and investors alike against the chain.

By Jason Notte Jun 12, 2013 8:29AM
Sears store on in Milford, Connecticut Spencer Platt/Getty ImagesObjectively, it takes a lengthy presentation of evidence over a broad span of time to even imply that Americans might think poorly of a fading retailer such as Sears Holdings (SHLD). Subjectively, it takes just one blog post to state what anyone who's stepped into one of those stores recently is thinking: Americans hate Sears.


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.


While the S&P 500 has risen by roughly 20% since 2006 and Wal-Mart's (WMT) share price has jumped by 60% in that span, Sears' shares have sunk 43% as chairman and chief executive Eddie Lampert closed a third of the chain's locations in the past four years and sold assets. The S&P 500 just booted it from the benchmark index, while the Dow Jones Industrial Average showed its ticker the door back in 1999.


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.


More on moneyNOW

671Comments
Jun 12, 2013 10:16AM
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I stopped shopping at Sears when they teamed up with the Kardashian klan hawking their cheap clothes and repugnant colognes.  This tawdry family is emblematic of the dumbing down of our culture.  Many moms refuse to spend their money at Sears because of this association.  Walking through Sears the other day (their parking lot is empty on the side of the mall) I noticed an empty store and the Kardashian garbage on sale for 60% off with no takers.
Jun 12, 2013 10:02AM
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I am a once-loyal Sears customer driven away by incredibly bad service experience and worse, a complete failure to address it by the corporation. Stated simply they told me a repair on a Craftsman Tractor was covered by warranty, then charged me a huge fee for the repair. I paid, assuming they would make me whole. When I complained, I was forced to repeat over and over again the entire story and heard nothing back. No justification. No apology. No acknowledgement. The lack of response, more than the original error finished Sears for me.  it's tough to run a retail business without customers.
Jun 12, 2013 9:50AM
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When was the last time you tried to get waited on in Sears.   The ship is sinking and the crew stands in the corner and talks to each other.   And you think it is difficult to find a sales rep in Walmart!
Jun 12, 2013 10:58AM
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I hate playing 20 questions when buying a $10 item at Sears Hardware. Sears card? Rewards card? Rewards card plus? Phone number? Email address? Would you recomment Sears? blah blah blah.
Jun 12, 2013 10:00AM
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The last time I went to K-Mart and didn't buy anything because its never marked to what it cost and there is no one to ask questions about merchandise, everything and I mean everything is from China, or some foreign country, nothing made in America.  Products aren't made well. But as I left the store, some illegal Mexicans were working outside. I asked and they responded that they were illegals. So I go back into the store and ask they Manager why he didn't hire Americans to do this work.  I complained that in our county there was a 15% unemployment rate and many Americans in our county are unable to find work.  His response he didn't hire them but the company management did.  Well I said, I've called the authorities to come pick the illegals up and left the store.  I watched in my car and he ran over to them and told them to pack up and leave.  I worked at the Dept. of Social Services at this time and saw how bad Americans were having to try to make ends meet.  On top of that, here comes an illegal Mom or Dad and files for assistance for their American born kids.  I had a black man come in to put his Mom in a nursing home and return two months later because he had to bring her home because her Social Security was the only thing they had to live off of.  This man was crying because he knew this was wrong but he had no choice.  He and his wife lost their jobs and he had 2 kids and nothing to live off of.  I've seen it all, while our country supports illegals and here is K-Mart (owned by Sears) supporting illegals.  They aren't the only company doing this and I dress them down each and every time I see it.  I ask them how dare they help support illegals while American citizens are unable to find work.  I can tell you when you put in their faces and threaten  to boycott their business or make a stink about their actions, they back down.  I've seen illegals doing roofing and I confront them and the next day, the men on top of that roof were American born people.  Please Americans don't sit there and be complacent about this. Voice your opinions, make the people do the right thing.  Even where I worked, they hired a construction company to do some work and I complained, almost lost my job, but I complained to the highest authority and to the news about why our own County was hiring and doing business with illegals.  They stopped and got some Americans working.
Jun 12, 2013 10:09AM
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Terrible customer service..........wife went in and paid off the credit card and then canceled card. Received a bill for about 20 dollars in which she thought it has to be a mistake. Wrong before she got that straightened out they had added another 20 dollars to the bill and turned us in to the credit bureau!!!
Jun 12, 2013 10:20AM
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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.

Jun 12, 2013 9:52AM
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Sears is experiencing an ELE because of poor corporate level leadership.
Jun 12, 2013 10:05AM
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I'm still waiting for the apology when a Sears accounting error falsely indicated I had not paid my bills. I will not set foot in any Sears brand store until I get that apology.  In November it will have been 20 years.  A defaulted legal judgement is insufficient.  
Jun 12, 2013 10:14AM
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I used to buy Sears all the time, but the quality of their products has really gone down in the past 10 years or so. Of course, so has most other products too. I have bought some of their products in the last 5 years and they break down to soon. Yea you can get parts from them easy enough, but you shouldn't ahvr to work on a weed eater right after the warranty runs out.
Jun 12, 2013 9:21AM
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I wrote you a letter Mr. CEO... you lack the skill set to fix your own failing enterprise (barely that now). When everybody follows but doesn't know who the leader is, all walk off a cliff. LOOK at your stores and tell us WHY we would shop at one? You've got nothing because you're all administration and no sales culture.
Jun 12, 2013 10:38AM
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I like to shop at K-Mart, but don't like Sears because I don't like their clothing selections (it all looks like old lady clothes).  Sadly, both stores look run down, and finding employees is like looking for a needle in a haystack.  They look like old, empty barns.  
Jun 12, 2013 9:58AM
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It must be pick on Sears week @ MSN money this week. I guess there are no villains on Wall Street to write about.
Jun 12, 2013 10:27AM
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 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.

Jun 12, 2013 11:01AM
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Bought a weed eater 3 months it wont run, took it back,they said to bad no warranty.  sears no more for me
Jun 12, 2013 10:29AM
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I stopped shopping at Sears/Kmart when they "lost an order" that I had placed and then I had to spend approximately 7 to 8 hours over 3 days on the phone to finally get my money back - I couldn't even cancel my order, because they "couldn't find it" and had one rep even hang up on me because I said the word "damn" - I was angry and assertive, but not vulgar or abusive, and there was no call for that.   I know here in my town you walk into either Kmart or Sears and they are like ghost towns - I know that they've lost my business forever.
Jun 12, 2013 9:02AM
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Sears is in a tough spot and they are last of the "all-inclusive, mega-retailers".  Are there any other stores that stock a bunch of major appliances AND toys AND clothes AND furniture AND tools AND electronics, while also selling eyeglasses AND tires AND mowers AND housewares, while also running a major, nationwide appliance repair business?  They are losing money on too many of these sectors.  Unfortunately, the way their business model works, it would be nearly impossible to spin off the unprofitable ones, because they all share the same retail space for the most part.


Jun 12, 2013 10:23AM
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I used to buy everything from Sears. However, I haven't been in one of their stores in years and I can't real tell why.
Jun 12, 2013 9:47AM
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First of all.  Another piece of crappy writing from one of MSN's finest journalists!  Why the Hate?  Write a fair and balanced article next time.  

Yes it is obvious that Sears is slowly dismantling itself.  It is a real estate play as far as their stocks are concerned, been that was for many years now and you Mr. Jason Notte,  the journalist still don't see that.

If Sears was concerned about store sales don't you think they would have done something about it?  They have huge amounts of real estate and it is very valuable, the CEO knows that and it doing something with those assets....selling them for a profit!
Jun 12, 2013 10:02AM
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out of sight out of mind maybe mega adds or an explosive internet ad that reconnects consumers with the brand ask anyone under 30 about sears and they cant give you an answer
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