Is the end near at Sears?

Predicting the demise of Sears & Kmart since 2017!
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Re: Is the end near at Sears?

Post by Bagels »

arizonaguy wrote: September 2nd, 2019, 8:39 pm Honestly, if the company wasn't owned by Lampert it would've probably liquidated in 2010/2011.

Sears actually was a decent store until 2010 or so when the wheels started to fall off. Kmart pretty much died in the 2002 bankruptcy and has been limping along ever since.
If Sears wasn't owned by Lampert, the retail landscape may be very different today. The WSJ ran a piece early in the year, noting that Lampert -- almost immediately after acquiring Sears -- largely killed off capex/investment projects and began running the company like a slow liquidation process (many analysts speculate Lampert's companies have made billions off of K-Mart/Sears, plus they still control the prime real estate). Remember, Sears Essential was a concept designed before Lampert acquired the company and was suppose to expedite Sears entry into off-mall locations. Sears planned to spend $7M-$10M in renovations to turn the stores into mini Sears; instead, they opened with little investment (the K-Mart interiors, retention of Little Cesars, K-Mart Pharmacy, K-Mart brands like Route 66, etc.).
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Re: Is the end near at Sears?

Post by J-Man »

I just saw this Facebook post about Sears' future (with some ominous predictions about JCPenney as well.)
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Re: Is the end near at Sears?

Post by Super S »

J-Man wrote: September 28th, 2019, 8:41 am I just saw this Facebook post about Sears' future (with some ominous predictions about JCPenney as well.)
Can't see the post, it says "closed group"......
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Re: Is the end near at Sears?

Post by J-Man »

Sorry! Here it is:
Well, here it is folks, taken from the Sears Layoffs forum webpage.
"The End Game"
Greetings from one of the pink slippers at HE. Here's what I know: the announcement (store closings) will be made on or around 10/21. The goal is to close the books on Q3, then Q4 will be total liquidation of all remaining Kmarts (and some additional Sears) starting on 11/1 and running through 1/31. All holiday advertising for both brands has been cancelled.

Sears stores that will survive into Q4 should not expect much inventory in softlines (except those that still have Lands End). DCs are being scaled down and consolidated to support a hardlines-only operation (plus mattresses).

The Kenmore sale is still being pursued. Negotiations with Lowe's have stalled; don't expect much action before the new year. There have also been conversations with Amazon. As it stands now, the Kenmore brand is the single most valuable asset of the company. (Believe it or not, the Guam lease is valued as the second-most valuable asset).

Expect a spinoff of Auto around Q2 next year. The new company will also assume ownership of the DieHard brand. Stores with standalone Auto will convert to DieHard Auto locations (very few of these left). In-store auto locations will close when stores wind down. The business plan calls for new locations outside the current Sears/Kmart real estate universe. Eddie is actually most excited about this plan than any other; he has been actively involved in the conversations.

Eddie is convinced there is still value in the SYW brand and platform. Expect it to live on as some type of online marketplace. However, we all know where that one is going to end. One concept I saw was to explore selling it to Citigroup as some type of e-commerce and rewards site for their customers. That colleague was laid off before me and I never heard more details.

All indicators point to JCP filing for Chapter 11 in late January. The mandate at HE was to maximize anything we can before then. A JCP liquidation would flood the real estate market like nothing we've ever seen. Essentially, the race is to wind down before they do.
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Re: Is the end near at Sears?

Post by storewanderer »

J-Man wrote: September 28th, 2019, 9:46 am Sorry! Here it is:
Well, here it is folks, taken from the Sears Layoffs forum webpage.
"The End Game"
Greetings from one of the pink slippers at HE. Here's what I know: the announcement (store closings) will be made on or around 10/21. The goal is to close the books on Q3, then Q4 will be total liquidation of all remaining Kmarts (and some additional Sears) starting on 11/1 and running through 1/31. All holiday advertising for both brands has been cancelled.

Sears stores that will survive into Q4 should not expect much inventory in softlines (except those that still have Lands End). DCs are being scaled down and consolidated to support a hardlines-only operation (plus mattresses).

The Kenmore sale is still being pursued. Negotiations with Lowe's have stalled; don't expect much action before the new year. There have also been conversations with Amazon. As it stands now, the Kenmore brand is the single most valuable asset of the company. (Believe it or not, the Guam lease is valued as the second-most valuable asset).

Expect a spinoff of Auto around Q2 next year. The new company will also assume ownership of the DieHard brand. Stores with standalone Auto will convert to DieHard Auto locations (very few of these left). In-store auto locations will close when stores wind down. The business plan calls for new locations outside the current Sears/Kmart real estate universe. Eddie is actually most excited about this plan than any other; he has been actively involved in the conversations.

Eddie is convinced there is still value in the SYW brand and platform. Expect it to live on as some type of online marketplace. However, we all know where that one is going to end. One concept I saw was to explore selling it to Citigroup as some type of e-commerce and rewards site for their customers. That colleague was laid off before me and I never heard more details.

All indicators point to JCP filing for Chapter 11 in late January. The mandate at HE was to maximize anything we can before then. A JCP liquidation would flood the real estate market like nothing we've ever seen. Essentially, the race is to wind down before they do.
I feel like I've been hearing about the end game of Kmart for years. But it never ends.

That it hasn't ended is simply amazing.

I was shocked when store count went below 200. I thought there was no way they can keep it going, with such a low store count. After the current set of closures finishes, the store count will fall well below 100. Again I am thinking the same thing. But when even stores like Bishop feel like a zombie (no competition for hours), which is the case now, you just have to think this game is about to finally end.

For me it is funny to go into Kmart and see all the same old equipment from 15+ years ago, still somehow attempting to function. Old carts, old point of sale equipment, old shelf tags, old order guns, old everything.

Reading the above post I try to envision how much worse it could get. What if Kmart completely exited softlines and stayed open but did not handle clothing anymore (they could install Sears mattresses in that space or something)? They already exited the electronics category. I am just throwing out ideas of how much worse it could possibly get, without them just shutting down with some degree of dignity left.
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Re: Is the end near at Sears?

Post by pseudo3d »

Bagels wrote: September 26th, 2019, 9:44 am
arizonaguy wrote: September 2nd, 2019, 8:39 pm Honestly, if the company wasn't owned by Lampert it would've probably liquidated in 2010/2011.

Sears actually was a decent store until 2010 or so when the wheels started to fall off. Kmart pretty much died in the 2002 bankruptcy and has been limping along ever since.
If Sears wasn't owned by Lampert, the retail landscape may be very different today. The WSJ ran a piece early in the year, noting that Lampert -- almost immediately after acquiring Sears -- largely killed off capex/investment projects and began running the company like a slow liquidation process (many analysts speculate Lampert's companies have made billions off of K-Mart/Sears, plus they still control the prime real estate). Remember, Sears Essential was a concept designed before Lampert acquired the company and was suppose to expedite Sears entry into off-mall locations. Sears planned to spend $7M-$10M in renovations to turn the stores into mini Sears; instead, they opened with little investment (the K-Mart interiors, retention of Little Cesars, K-Mart Pharmacy, K-Mart brands like Route 66, etc.).
Essentials was SHLD, but Grand wasn't. I'm not sure if Grand would've succeeded in the long run, their odd mix of hardlines and softlines without a major food component wasn't a good one. But then again, we would be talking about a well-moneyed company with the potential to hire decent people, so maybe it could have worked.

I'm surprised about JCPenney, though. Are they really in that bad of shape?
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Re: Is the end near at Sears?

Post by J-Man »

I found the website from which that Facebook post came.
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Re: Is the end near at Sears?

Post by Bagels »

pseudo3d wrote: September 28th, 2019, 6:05 pm Essentials was SHLD, but Grand wasn't. I'm not sure if Grand would've succeeded in the long run, their odd mix of hardlines and softlines without a major food component wasn't a good one. But then again, we would be talking about a well-moneyed company with the potential to hire decent people, so maybe it could have worked.

I'm surprised about JCPenney, though. Are they really in that bad of shape?
The Essentials concept originated pre-SHLD. During K-Mart's bankruptcy, the WSJ first reported Sears was interested in acquiring some of K-Mart's top real estate and transitioning them into "mini-Sears." And long before the "merger" was announced in 2014, a trade publication reported Sears was close to finalizing a deal for numerous K-Mart sites, which would then be renovated -- at an estimated cost of $7M-$10M each -- into mini-Sears. That deal wasn't finalized until around the time the merger was announced, and after the merger, Sears/K-Mart announced that the deal would be expanded to include 400 K-Marts that would be transitioned into Sears.

A Sears Essentials near me was used as a prototype. They liquidated much of the K-Mart merchandise and briefly closed the store. They used a mixture of furniture and fixtures from both K-Mart and a closed Sears, as well as created a custom Sears graphic package. But they kept the K-Mart interior, Little Caesars, etc. Later Sears Essentials in my area remained open during the conversion from K-Mart and saw little investment; they more-or-less moved F&F around, put in Sears merchandise and dumped K-Mart merchandise in a new "clearance zone" - which was the former K-Cafe. It was a hot mess.

And yes, JCP is in pretty bad shape. The stock dropped below a $1, they're trying to renegotiate debt and will likely file for bankruptcy if their holiday sales are bad (which is likely).
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Re: Is the end near at Sears?

Post by storewanderer »

Went to Kmart again. It appears they are exiting the kitchen/home storage category. The area has not been restocked in months and now they have plastic cutlery on the shelves where they used to have actual cutlery. The aisle that used to have closet organization and home storage type items is now filled with paper towels... cannot believe how these aisles look.

Still a lot of half price pet food, paper product, and cleaning items. The shelves are lightening on those items. Grocery area doesn't appear to have been restocked in a month since the first receipt of Best Yet items from C&S.

Was issued $5 off $15 coupon "good starting tomorrow" for 5 days following date of purchase.

Also some gimmick of spending $10 on some merchandise category, get back $10 in Shop Your Way points on October 20 to be valid for a week after that, or something.

Also cashier continues to take a tally sheet (on receipt paper) of how many customers use Shop your Way, Sears Card, etc. when paying. What a joke.
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Re: Is the end near at Sears?

Post by cjd »

Sounds like they're "exiting" everything but disposables. Pretty soon nobody is going to bother going there. Why waste time when you can get it all at the grocery store or Walmart?
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