Is 2021 finally the end for Sears/Kmart?

Predicting the demise of Sears & Kmart since 2017!
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storewanderer
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Re: Is 2021 finally the end for Sears/Kmart?

Post by storewanderer »

Went to the Kmart in Grass Valley, CA today. There have been plans submitted to the city of a new Target to take this space over but no closure has been announced formally.

The store is stocked better than it was last time I was there but they have not reopened any closed aisles (basically the entire hardlines aisles are closed). They have a small summer seasonal area set up with mainly beach towels, some water toys, swimming foam noodles which were shipped to the store via UPS, and a few patio sets. What little is left of general merchandise was fully stocked with an odd assortment of throws, towels, hangers, small kitchen appliances, and then one aisles of Diehard/Craftsman items and some other random scraps of auto/hardware. There were also two aisles of not great looking toys.

While in the store I watched 3 different customers ask if the store had sporting goods- no was the answer every time of course.

When I entered the store they had 4 checkstands open, which was strange, as there were only about six cars in the parking lot mid-day today and 3 of those 6 customers were using the pharmacy. By the time I left it was down to 2 checkstands open.

The C&S areas are very, very fully stocked (food, drug, cleaning, pet). I was really surprised how full the shelves were given they have nothing on sale and very high prices on everything (there is an IGA in the same shopping center selling all of these same items for lower prices).

The pharmacy is very much alive with customers coming and going and also this pharmacy is administering COVID-19 shots which I thought was interesting- someone has to be alive in the corporate office and managing things to have made that happen.
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Re: Is 2021 finally the end for Sears/Kmart?

Post by BillyGr »

storewanderer wrote: May 30th, 2021, 12:02 am The pharmacy is very much alive with customers coming and going and also this pharmacy is administering COVID-19 shots which I thought was interesting- someone has to be alive in the corporate office and managing things to have made that happen.
Though independent pharmacies have offered the vaccines as well (at least here in NY) - maybe if not the corporate office than whoever is in charge of the pharmacy got something set up for that store?
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Re: Is 2021 finally the end for Sears/Kmart?

Post by storewanderer »

BillyGr wrote: May 30th, 2021, 11:13 am
storewanderer wrote: May 30th, 2021, 12:02 am The pharmacy is very much alive with customers coming and going and also this pharmacy is administering COVID-19 shots which I thought was interesting- someone has to be alive in the corporate office and managing things to have made that happen.
Though independent pharmacies have offered the vaccines as well (at least here in NY) - maybe if not the corporate office than whoever is in charge of the pharmacy got something set up for that store?
Kmart does have a second pharmacy open in California in Freedom, CA which appears to also be on this program.

I think Kmart has about 6 pharmacies still open across the chain of 21 stores total. Hard to understand how that makes any sense given they are in multiple states and have to go into networks/insurance plans in all those different states. But in the case of this Grass Valley store the pharmacy is the only part of the store that has activity at this point (the only area they seem to even be trying to operate) so it appears this pharmacy operation is important to them.

I also forgot to mention they have a small display of plants outside the store. It is the length of about 3 shopping carts. Rite Aid has more plants (and doesn't have many).

Also, the jewelry counter which was previously quite full is now about 10% stocked at best with product. The other Kmart I have access to up at South Lake Tahoe pulled its jewelry counter out 15-20 years ago (small store).

Also they had a large display and sale on Pepsi 12pk at $4 and some Lays items at some sale price. This is the only sale item in their entire consumable/pet/cleaning/drug/HBA area. What I am wondering is where they are advertising this sale since they don't run a print ad.
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Re: Is 2021 finally the end for Sears/Kmart?

Post by Alpha8472 »

Pharmacies bring people into the stores. Without Pharmacies, the customer traffic would be drastically reduced. The pharmacies make profits if they are in good neighborhoods with few Medicaid patients. If the neighborhood has low income patients who have only Medicaid, the pharmacy will lose money. However, the net effect on the store is that pharmacies bring customers into the store to buy other merchandise besides prescriptions.
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Re: Is 2021 finally the end for Sears/Kmart?

Post by rwsandiego »

storewanderer wrote: May 30th, 2021, 11:37 am...I think Kmart has about 6 pharmacies still open across the chain of 21 stores total. Hard to understand how that makes any sense given they are in multiple states and have to go into networks/insurance plans in all those different states. But in the case of this Grass Valley store the pharmacy is the only part of the store that has activity at this point (the only area they seem to even be trying to operate) so it appears this pharmacy operation is important to them....
It's actually not that hard. The Pharmacy Benefits Management companies (PBMs) have the contracts with the health plans. They build the pharmacy networks by signing contracts with pharmacies. So...KMart has a contract with the various PBMs and the PBMs drive business to them thanks to having contracts with the insurance companies. That's why when Walgreens had its spat with Express Scripts all patients across the US whose insurance companies used Express Scripts were (or would have been, can't recall if they ever stopped accepting them) affected.

My guess is KMart has had PBM contracts for decades and at this point is just letting the pharmacies run. That is, until Eddie Lampert figures out he can make a few bucks by selling the pharmacy records to a competitor.
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Re: Is 2021 finally the end for Sears/Kmart?

Post by Alpha8472 »

Walgreens stopped accepting Express Scripts in 2012. They lost many customers to other pharmacy chains. This really jump started business at other pharmacies. Eventually Walgreens started to accept Express Scripts again, however many of those customers never went back to Walgreens as they realized that Walgreens was the worst at customer service and staffing. Walgreens doesn't care. They operate on the idea that they have so many customers, they don't care if they lose some to other pharmacy chains.

It would be difficult to sell the pharmacy records to other chains. Walgreens would not want to buy the records as Walgreens refuses to accept most money losing Medicaid insurance customers. I would assume Kmart customers would be predominantly low income Medicaid customers. CVS on the other hand does accept Medicaid and would probably buy the records as they just want to get more customers to go into their CVS stores to buy something.
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Re: Is 2021 finally the end for Sears/Kmart?

Post by retailfanmitchell019 »

Interesting article from Retail Dive.
https://www.retaildive.com/news/is-the- ... rs/600562/
Only 28 Sears and 21 Kmarts left.
I don't know how long this crap is going to continue on, considering Eddie wants to make this a long and painful death.
I do think Kmart and the full-line Sears stores will be fully gone by next year however. Sears Hometown might survive.
Kmart only has 4 stores west of the Mississippi River at this point, and only 1 store left in the Midwest (Marshall, MI).

If it weren't for COVID, would Kmart be out of business already?
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Re: Is 2021 finally the end for Sears/Kmart?

Post by DFWRetaileWatcher »

retailfanmitchell019 wrote: June 1st, 2021, 11:58 am Interesting article from Retail Dive.
https://www.retaildive.com/news/is-the- ... rs/600562/
Only 28 Sears and 21 Kmarts left.
I don't know how long this crap is going to continue on, considering Eddie wants to make this a long and painful death.
I do think Kmart and the full-line Sears stores will be fully gone by next year however. Sears Hometown might survive.
Kmart only has 4 stores west of the Mississippi River at this point, and only 1 store left in the Midwest (Marshall, MI).

If it weren't for COVID, would Kmart be out of business already?
I'm more shocked that Sears and Kmart have survived COVID.
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Re: Is 2021 finally the end for Sears/Kmart?

Post by storewanderer »

Decided to make the trek to the nearest open Sears- in Stockton, CA. I think this is also the last Sears in Northern California? I was lucky I made it here during their daily operating hours of 11 AM to 6 PM.

The store hardly had any customers mid-day. As far as employees go there was one cashier in softlines and one cashier in hardlines. There was also an employee doing some kind of merchandising work (moving around items on displays) who appeared to be some kind of manager. I was surprised (or not) to see appliances was not staffed and many slots where floor models should be, did not have floor models present. The auto shop in the parking lot had 5 cars being worked on when I pulled up and when I left an hour later there were 7 cars being worked on in the auto shop. I'm not sure how many employees were there but there were definitely more than the main store had.

So this store, the top floor has most of clothing and all of hardlines. The clothing area has clothes very spread out on the racks. Mostly private label items. Many women's winter clothes at 3.99 clearance, also the Outdoor Life line in men's has a number of pants, sweatshirts, zip up coats, etc, and is 2.99 clearance which is a deal if anyone can find a size they can use, but most of what is left is XXXL and up in size, also some XXL-Ts, etc. Noticed Basic Editions (Kmart brand) clothing present in some cases with Kmart tags/prices.

The basement has kid's clothing and home items. Kid's clothing was like the rest of clothing- spread out to take up all of the floor space. Home goods had just a small floor space and then the rest of it was blocked off and being used as storage for un-used fixtures. Some Essential Home (Kmart brand) items present.

On to hardlines- the tool section has all of its aisles closed off so there is just the area in front of the closed off aisles and a little wall space for tools. The tool assortment is probably down 80% from what it was. Appliances as I mentioned before was not staffed and many floor model spaces were empty.

The mall entrance was wide open but there was no staffing anywhere near the mall entrance. The Sears Store felt safe, orderly, clean, and neat. Given there is little to no branded merchandise, I don't think there is much theft risk here with the lack of staff.

I did make a purchase and was surprised when paying, after my receipt, out popped a Shop Your Way Coupon. Kmart has not issued any coupons in the past year at all like this. This coupon however for $80 Freecash in Points when you spend $1,099 or more storewide was a bit reaching in my opinion. Also the coupon has no bar code or PLU code so I have no idea how you would even redeem it.


What is interesting is it seems like the Kmart Stores have more inventory than the Sears.

Ironic Stockton has what is the only Sears in NorCal now, and also the only Dillards.
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Re: Is 2021 finally the end for Sears/Kmart?

Post by Super S »

storewanderer wrote: June 15th, 2021, 12:46 am
I did make a purchase and was surprised when paying, after my receipt, out popped a Shop Your Way Coupon. Kmart has not issued any coupons in the past year at all like this. This coupon however for $80 Freecash in Points when you spend $1,099 or more storewide was a bit reaching in my opinion. Also the coupon has no bar code or PLU code so I have no idea how you would even redeem it.
Why do they still even bother with pointless coupons like that? It's a waste of paper. About the only thing left that you could spend that kind of money on is appliances and maybe something like a riding mower. But with selection so thin, and the fact that the Sears name is damaged goods (many thinking the chain is already gone) people aren't going to be making Sears their first choice for major purchases.

Those coupons always seemed pointless in the past whenever I saw them. The register would typically spit out about two feet of these on the register tape, and it would be something pointless such as a discount that could only be used on an odd day during an odd time period in the afternoon. Not once did I ever receive a coupon that was actually useful.
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