Sears stumbles yet again

Will Eddie Lampert's retail empire ever get its act together?

By Jonathan Berr Nov 17, 2011 12:17PM

Sears Holdings (SHLD) CEO Lou D'Ambrosio deserves credit for not sugar-coating lousy quarterly earnings. Too bad talk is cheap.

The struggling retail empire controlled by investor Eddie Lampert reported a net loss of $421 million, or $3.95 per share, significantly worse than the loss of $218 million, or $1.98, a year earlier. Sales slumped for the 19th straight quarter, tumbling 1.2% to $9.57 billion. 


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D'Ambrosio, who joined Sears earlier this year from the technology and telecom firm Avaya, and Lampert are trying to turn around the 125-year-old company by emphasizing e-commerce, smaller stores and licensing deals. The efforts have yet to bear much fruit, a fact that D'Ambrosio understands.

"While we are not satisfied with our performance, we saw improvement in some core areas," he said in the earnings press release. "Sears full-line stores saw improvement, as Sears apparel achieved both comparable store sales and margin rate increases in the quarter," he added.

Of course, the key metric -- same-store sales -- was awful. Domestic store sales fell 0.7%, Kmart's comparable store sales declined 0.9% and Sears Canada same store sales declined 7.8%.  


Though weak consumer confidence is hurting retailers, some Sears competitors are faring better. Target (TGT) yesterday reportedbetter-than-expected third quarter results, fueled by a 4.3% increase in quarterly comparable-store salesDollar Tree (DLTR) earnings also surpassed Wall Street expectations as same-store sales surged 4.8%.

Investors, who have seen the value of their shares tumble more than 60% over the past 5 years, have grown tired of waiting for Sears to reinvent itself. Now they are going to have to wait longer to recoup their investments.


D'Ambrosio said in the earnings release that Sears is "investing in our future" through "innovative" technology.  Wall Street analysts have an average price target of $43, about $20 under where it trades today, indicating that they have little faith that Sears will ever rebound.

Probably the best that Sears can do is clean its balance sheet in preparation for a sale to a private equity player or a larger rival.

Disclosure: Jonathan Berr owns shares of Target.

Nov 17, 2011 1:28PM
I NEVER shop there anymore solely because of the OUTRAGEOUS interest they charge on their bank card.  Citibank received funds to bail them out, they are not doing anything to help us.  And I used to like shopping there because of there policy of holding jobs for their soldiers that are activated.  Sorry-you won't help me, I won't help you.
Nov 17, 2011 1:43PM
I used to buy all of my appliances at Sears because they were the best. Now, most of them are cheap crap. The fridge fell apart after 5 years, the microwave in 2, and the stove in 7. I replaced them all at Lowes. No more Sears for me.
Nov 17, 2011 1:49PM

K-mart:  5 minutes to find your shopping items, 30 minutes to check out.  sure....i go there "often"    (not)


Wake up Sears and Kmart.
Nov 17, 2011 1:58PM
If Sears is stupid enough to sell their brands outside of Sears stores, then you have the dumbest CEO in history. Why would anyone need to go to Sears if not for Kenmore and other name brands that only Sears carries? Sell them outside of Sears and you'll have signed your own death warrant. I'm sure Whirlpool or Westinghouse would love that Kenmore name brand. We are being lead by the stupid, and they have put other morons in charge.
Nov 17, 2011 1:37PM
Wake up Sears and Kmart. You guys are slipping fast and will continue to slid. I would fire every executive and start with new people not someone that thinks they know it all don't tell me i am the expert. Sears used to be a great store. Now they are nothing compared to what they were because they offer nothing special anymore. The same stuff everybody else does with out its old customer service. Remember when you could buy just about anything you could thing of from sears and get great customer service. You could go to the tool department and buy machines' tools and many others even if you had to order it. Sporting goods department. Remember sears hunting and gun department. My first shotgun was a Jc higgins. They are missing what set them apart from everybody else! Kmart same thing they hardly carry anything they used to and pricing is 20% to high. Remember the Kmart honey glazed ham deli meat. It was always in my house.
Nov 17, 2011 1:55PM
The LAST time I purchased anything from sears it was a dishwasher and when they installed it they damaged my kitchen counter and refused to repair it. I will never buy anything from there again and I tell this story every chance I get.
Nov 17, 2011 1:48PM

i boycotted sears ever since 1989.  almost screwed by their auto service people on a new di-hard battery that they tried to say was a "loaner" after it stopped working.  this was the last straw of SEVERAL events.  i'm stunned they are still around all these years.  no store stands out more as having such poor service. 


used to be you had to go to several check outs to check out.  (hardware in hardware.  clothing in clothing, etc).  if you bought equipment (had an old outboard motor) that neded spare parts the service center was only open weekdays 9 to 4 WHILE I WAS AT WORK!  then typical spare parts had to be placed on order.  warantee paperwork miss spelled my name and they said they couldn't fix it. 


local to me the sears store is a ghost town.  hardly an "anchor store" anymore

Nov 17, 2011 2:48PM
Sear's customer service and employee customer skills have declined to nothing. Most of the seasoned clerks stand around and talk with each other. Only the newly hired seemed to be helpful when you can find one. I have looked around for someone to check me out numerous times and finally just gave up and quit going to Sears. I did like their appliances,outside machinery and tools in the past. Its a shame as the only place I can find good garden tools any more is ACE hardware. Sears demise is a management issue as the demand is there even in a bad economy for a lot of what they sell..
Nov 17, 2011 1:29PM

Sears used to give and mail coupons applicable to EVERYTHING, including clearance, sale, and regular merchandise.  Now their coupons are only for regular-price merchandise.   Meanwhile, all of their clearance and sale merchandise sits taking up space in the store.   Bring back the GOOD coupons and we will buy.   I used to buy a lot of merchandise when it was on clearance IF I had a coupon which would help with that.     Give and send the coupons and the merchandise will move.  One doesn't have to be an executive to figure that one out.   Even my housekeeper who is from El Salvador recognizes that fact.  She has also stopped buying because of the lack of good coupons.  Also, bring back the  long-term, no interest, FREE delivery on appliances and other large items.   I know many people who have decided not to buy any of those items at Sears because those incentives have been taken away.    PAY ATTENTION, SEARS EXEC'S!!!!!!

Also, lower your interest rates on your credit cards!!

Nov 17, 2011 2:27PM
I love how there is no goal of CUSTOMER SERVICE.  I friggin' HATE Best Buy and whatnot putting everything online but nothing in the store, nothing you can actually test, etc.  Worse, there is no one to talk to... much less anyone with a clue of how to actually help you.

Yeah, go to ecommerce.  Guaranteed death sentence, especially when they have no one qualified to actually help a customer find what they need. 

Nov 17, 2011 1:56PM
What buyer would want K Mart or Sears?
Nov 17, 2011 3:05PM
To Slipknot7 and Deeleittl and others who wonder where to get great "Made in the USA" products. 

 My 110 year old family hardware store (Ankeny Hardware) continues to grow by selling as  much higher-end "Made in USA" products as possible.  Yes, some specialty products will always be imported (from Germany, Japan, Sweden, Canada, etc) , but we also strive to have as little cheaply made "Chinese" imported products as possible.

Ankeny Hardware heavily stocks "Made in USA" brands like Channellock, Klein, General, Mayhew, NEC, Crescent (selected USA items), Estwing, Vaughan, and many others.  These are lines that we are proud to sell and support the American economy.

Ankeny Hardware continues to grow and prosper by following what our business cards clearly read:  "We only sell products were proud to use ourselves".  We have been successful by NOT SELLING 99 cent screwdrivers, $2.99 hammers, and $3.99 wrenches.

BUY AMERICAN MADE QUALITY PRODUCTS.  Support our country and the merchants that continue to proudly emphasize "Made in USA".

In no way am I trying to solicit business (I believe you should always shop and support your local merchants), but If you can't find the "Made in USA" product you need, you're invited to contact us and we will do everything possible to help you.

Ankeny Hardware
Attn: Norman (3rd Generation owner)
1134 SE Stark Street
Portland, OR. 97214
PH 503-234-6110
e-mail: normondist@hotmail.c​om 
Nov 17, 2011 3:02PM
I went to Sears this weekend after skipping it for 5 years.  This weekend reconfirmed my decision not to shop at Sears.  Service was poor - service people standing around talking to each other.  I had to go to three check out places and the service person still could not figure out how to charge a coat.  I could have done it.  Not going back.  Five years ago I purchase a grill to be delivered set up - damaged on delivery and missing parts - never returned to fix either.  Sears could close and no one would  care.
Nov 17, 2011 3:11PM
Our recent experience with buying appliances from Sears was horrible.  Twice the appliance was damaged when it arrived at our home. When we complained following cancellation of the order, we found that they had outsourced their customer service department to a company that has no sympathy for the customer and no loyalty to Sears.  We had bought all our appliances from Sears for some forty years but they will never see us as customers again.
Nov 17, 2011 3:18PM
We used to shop at Sear's quite a bit, as there is one just about a half mile from our house.  And I believe we did purchase our last appliance (a frig) from them.  But when they began selling the Kartrashian sisters' line of clothing, I vowed NEVER to shop there again.  And I haven't been to Sear's since.
Nov 17, 2011 2:58PM

I would love to shop at Sears here in my local community but I hate the delivery charges, we are 1.2 miles from the store.......also, when I call for service its like a grand inquisition before you can shedule an appt.



Nov 17, 2011 2:31PM
the day sear close there door for ever will be the best . sear damaged  my stove and wouldn't fix it good rid dens to bad rubbish i will shop them when they have a GOING OUT OF BUSINESS SALE
Nov 17, 2011 3:06PM
I stopped shopping their after they refused to honor their customer satisfaction guarantee - printed over the main entrance at every Sears (SEARS, not "sear") - on one of their own products.
Nov 17, 2011 3:27PM

marketing class 101 says a dissatisfied customer will repeat their story to at least 20 people while a satisfied one only speaks to fewer than 5.  it's a shame these stores never took any marketing 101 classes. 


The LAST time I purchased anything from sears it was a dishwasher and when they installed it they damaged my kitchen counter and refused to repair it. I will never buy anything from there again and I tell this story every chance I get.
Nov 17, 2011 5:21PM
I firmly believe that the demise of Sears started long ago when they eliminated their general catalog and the in-store catalog order department with real people behind the counter.

I know that in our family, when you needed to buy anything, the very first thing we did was to look in the Sears catalog (and maybe Montgomery Ward and Penney's catalogs, too). Then you probably went to the Sears store to see if they had it in stock so you could actually see the item and check if the store price was any higher than the catalog price. If you didn't buy the item off the floor for some reason, you stopped by the catalog order desk to order it before you left the store.

They had you coming and going and people loved it! I'll bet that same scenario played out in millions of families across the nation every day. Their catalog system was a priceless asset to the company and they dumped it!

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