Mr Lampert is master crook
13
This is what is happening to the entire country. Its being looted by a bunch of smart folks from Yale and Harvard for their own benefit. These "world citizens" don't have any interest in the interests of Americans in general. They have taken the capital we created and invested it in creating competition and jobs ... in China. They control every major institution and they see the rest of us as a population to be managed.
Just think for a moment about their outrage that the Russians daring to try to influence how Americans choose to vote. Manipulating American voters is for the current ruling elite and foreigners have no business stepping on their turf.
15
I worked for Sears for a while, and was amazed at just how bad company management was. One example - we were always starved for stock on popular items like snowblowers and lawnmowers. Yet within days of the announcement that our store would close, massive piles of the missing items poured in - items we'd been begging for. There's far more than that, but hey, I'm guessing that EL will make out like the bandit he is! Hopefully one day he'll get taken down for what he did to such a proud firm.
10
Sears had a good run. After WWII their infrastructure and vast catalogue helped America come off a war mentality and into the post war boom. They achieved great success but as often happens their growth, success and long tenure at the top ossified their thinking, the “we always do it this way” creeped in and mistakes began to replace success. Nowadays with the corporate vultures flying around looking for ways to make money off a dying enterprise, the endings are always predictable. So RIP Sears, I appreciate the job with you that allowed me to finish college, for the tools, appliances that helped make life work and off course the hot salted cashews that greeted me and my parents when we came in the story. Great memories from a simpler time but important lessons for life.
9
Reading the related article by Ms.Hsu on Sears’ Glory days as the king of retailers, a few important milestones were not mentioned. When they expanded into financial service to try to become the “one stop to do all you shopping needs” from stocks to socks, that included Dean Witter Reynolds which would later spin off Morgan Stanley and Discover Card.
I completely forgot or missed the reference to Caldwell Banker. But also they also held vast commercial real estate holdings in the malls that they anchored. I believe it was in part thru Vornado REIT.
Back then, before IRA’s and 401k’s came into vogue, Sears like many other big corporation’s incentive to retain employees were in the form of a pension based on a the purchasing of company stock, that they would increasingly match, depending on years of service. They would match 1:1 for beginners, and up to 4:1 for old timers with 25+ years service. I can’t think any retailer, let alone any Fortune 500 company today that gives you $1k for every $1k you buy, let alone $4k for every $1K just for working for them.
My guess is when the bankers came to Sears’ rescue, they saw all that money going to the lowly employees and figure out a way ‘funnel it away’ to keep it for themselves...! Word had spread throughout the corporate/banking world and now a full time gig can hardly provide for a family and savings for college.
12
It's over for Sears. Lock the doors. Shut the coffin. Grieve.
Let's pop a cork and raise a toast to a class act for their long run and the marvelous service it gave us for generations. It's okay to shed a tear for the greatness that once was.
I will always respect their logistical genius that let me go online and order a repair part for a 30-year-old power tool; no one else had such power. Such capabilities are lost on today's shoppers.
Sadly, I see no way for Sears to recover given how much store footprint is already gone, how much competition they have in the retail space, and how fickle customers are today in a throwaway society as they focus on cheap cheap cheap now now now.
Relegate Sears to the history books with Montgomery Wards, Kresge, May, Hechts, Woodward & Lothrop, Wannamakers, Jelleffs, Woolworth's, GEM, Raleigh's, Ben Franklin, E. J. Korvettes, Zayre's and hundreds more of all stripes as listed ...
https://en.wikipedia.org/wiki/List_of_defunct_department_stores_of_the_U...
https://en.wikipedia.org/wiki/List_of_defunct_retailers_of_the_United_St...
7
A lot of jobs lost from Sears over the years. Too bad they're not in the coal industry, or struggling on the Florida panhandle to rebuild.
Instead, they -- like the poor upstate New Yorkers who find themselves with no industry to support them -- will need to go where the jobs are instead of waiting for the government to bring them back to them.
Scott Walker's been spending millions to attract out-of-state workers to the future FoxConn plant that will cost Wisconsin taxpayers $4B in incentives. Time to move to Milwaukee all you forgotten retail workers.
2
Just recently a coffee grinder sold for $29.95 at Amazon and over $100 at Sears. Both were the exact same make and model. I understand that this is a mere nothing in what has happened to Sears but how on earth could they hope to compete with a pricing strategy that discouraged shoppers from making a purchase.
5
I just finished "Glass House" by Brian Alexander about the destruction of Anchor Hocking by Hedge Funds and Private Equity. The playbook there is repeated here: Leverage assets with repayment going through the funds, sell off assets, lease back from the company that sold and bought your real-estate. Generate fees for your other companies. No reinvestment. No vision. A playbook for the greedy.
The "writing on the wall" was not so indelible when Lampert took control that Sears could not have made the changes necessary. Instead it tried the (tired) approach of adding retail outlets while simultaneously selling off assets. It generated quick cash but no lasting value for the business.
17
Good riddance. The gonifs who merged Sears with KMart got what they deserved. I hope they lost billions. When KMart came out of bankruptcy the Judge let them destroy all shareholder value to “enhance” its acquisition value. Millions lost their entire investment. I have not spent one cent at Sears/KMart since.
2
Not a single sentence in any of the Times' pieces on Sears today mentions the name of Julius Rosenwald.
One cannot discuss the company's history without highlighting him and his many philanthropic contributions in Chicago and beyond.
4
The only surprise here is that it took this long.
They should have filed 10 years ago.
The stores were deteriorating even longer than that. In my area, all the Sears stores have closed down.
It's terribly sad for those of us with wonderful memories of shopping there, and the fantastic catalogs (gone since 1993, I think).
Sears had the potential to be Amazon, before Amazon was Amazon. They had the market, the distribution network, the customers. They blew it big time.
9
Well, at least there's Woolworth's.
Oh.
9
I was laid off last December from Sears Canada with the demise of said company. As for American employees of Sears, don't expect a good ending.
Eddie Lampert is culpable for much, but he's also an easy target. As a retailer, Sears eschewed innovation to an extreme degree. I recall far too often management saying, " We've always done things this way." Even after proving the futility of this position on many occasions, management would reiterate that stubborn sentiment. The company was also plagued with a culture where fixing blame took priority over fixing problems. Needless to add, it was also the most top heavy company for which I have worked. When people speak of managerial incompetence at Sears, it's a result of quantity over quality.
Even so, I'm more disappointed than bitter about the end of Sears. Whether Sears Canada could have and Sears in the USA can be saved is debatable. What is beyond dispute, however, is an unwillingness to do so.
5
Lampert and his brethren have robbed many Americans of their savings. He took these billions of dollars from ordinary citizens. History will not be kind to Lambert for this.
11
It's ironic that SEARS would shut down their "Catalog Operations" in the 80s... the precursor conceivably to Amazon. If only they could have foreseeen the Internet: the biggest mail order operation in the world.
7
What do P. Trump and Sears have in common?
Believing that you can live forever on borrowed money.
4
Please spare us the wistful memories of growing up with Sears and buying your kiddies toys.
This is business, pure and simple. They come, they endure, they die; just life life itself.
The same wailing and protesters happened in Chicago with the demise of Marshall Field. Does anyone ever mention it now?
As Lennie told Lila in “The Heartbreak Kid,” “It’s over, Lila; it’s over.”
1
@SmileyBurnette
Right, this is business.
Sears is an American - based business that sold a wide range of everyday products to a broad consumer base, with customers whose experience with the brand spans decades or generations. Many of the comments here point out steps the company could have / should have taken to maintain the market share they enjoyed in more successful times. There's still a customer base that would support Sears if the brand had better evolved with the times. Not you maybe, but some others.
I don't know if Marshall Field was mismanaged like Sears by a hedge fund operator with no retail experience, or if it just failed to keep up with the changing times. But Marshall Field did not have the reach Sears had, did not have the store locations all over the country or the catalogue business that gave Sears decades of success. Some of those commenting here believe Sears squandered a big head start on other retailers that succeed now selling the same products.
8
68,000 jobs lost... under Republican's.
How do Republicans define jobs???
I love how Trump deflected on climate change in his 60 minutes interview yesterday citing jobs. To me climate change means lots and lots of jobs.
4
Sears has been dying for decades. If 68,000 jobs have to be lost, best to do it while unemployment is at a 50 year low.
1
Thanks for the article on Sears. Typically, I enjoy all of your journalistic efforts, and I still receive the paper daily on my driveway. I am, however, disappointed in this article on Sears in its avoidance of what really happens when a hedge fund takes a company, sells its primary assets, lets the brand die and escapes through bankruptcy. I expect more from The NY Times and remain optimistic that the publication will continue to bring me news I can trust.
14
This has happened in industry after industry, after finance types who are clueless about the product or service take over.
Contrast this with German or Japanese companies, never run by finance types, always by people who truly understand the product, and consumer's tastes.
Most Amercian products by this system are second rate. Our cars are not world competitive, nor our appliances, you name it.
Ironically, it was GE and the BCG four box framework that viewed lines of business as cash cows that further caused all these businesses to head downhill. Added by insight-free overuse of Excel, and real-estate types thinking they know retail. Please
Milk them till they are uncompetitive, gee, excellent strategy.
A perversion of the board structure is that it rewards these types, in the 'shareholder interest'. That interest is fed coming out of the hide of the product. So what is left can't compete. Ergo we have Sears.
9
One of my only memories of my grandfather was the day he took me and my grandmother to Sears. My grandmother and I waited in the car while he went inside. I was maybe 5 or 6 years old, and to me he was taking a long time to come out. I squirmed. I figited. I sighed loudly. Finally he came out holding a brown paper bag, which he gave me when he got in the car. It was a toy airplane. I smiled. l laughed. l looked up at the big building with Sears name in blue letters. It was a good day.
10
I had a similar experience on Christmas eve day, circa 1971. Dad went into Sears and I was instructed to stay in the car....not too cold that December for Chicago. He soon returned with a huge bag that he promptly put into the trunk.
That was the year mom left.
3
Three months ago I went to Sears, and it was like time travel. I had broken the '70s-era Craftsman ratchet I got from my dad. Our local Sears in Saugus MA rebuilt (not replaced) this tool. It was as if, entering their doors, I had slipped back into a shop from decades ago. I will cherish the memory of that bygone era forever. The amount of time and infrastructure this service must have taken is not sustainable when in competition with lean, corner-cutting businesses like Amazon, who, as far as I can tell, create no cherished customer service memories for me. Sears got squeezed between two eras, still wanting to maintain their old-school reputation for quality and service (high expenses) while faced with cut-rate competition forcing their prices down. I will miss Sears. Ownership by a robber baron certainly didn't help, but the writing's been on the walls of their tool department for ages.
New tools I buy will be Snap-on (professional grade with a service network) or Harbor Freight (cut-rate, no guarantees at all).
9
Sears was THE big box store in Pasadena Ca for decades. It is in a small shopping center, unlike some of its nearby stores in Burbank Ca for example. In Burbank it's linked to Macy's and a whole slew of boutique and not so boutique shops.
Not sure if location makes a difference.
As a 71 year old from rural Wisc I remember the Sears catalogue as a wish book and also of use in the outhouses of yesteryear. My dear departed mother-in-law worked as a bookkeeper for the Sears in La Crosse, WI. She often worked a 38-hour work week, but never 40 for then she would be entitled to benefits. Sears limped along for years, yet its track record was always mixed. I hope that the pensions are safe.
5
Sears ripped me off in their auto "repair" scam in the 90's. I found out about the reimbursement settlement too late to sign on. I told everyone I could what an unethical low life operation Sears was for a long time. I hope I was able to contribute in some small way to the destruction of this bunch of thieves. Now, for the rest of the corporatist robber barons!
1
I have fond memories of Sears in Detroit on Woodward Ave. The smell of popcorn and hot peanuts. The fresh chocolates.....You could buy anything there. Sadly, I also remember the segregated water fountains within the store. This was in the 1950’s.
Even today I still shop at Sears. All my appliances, my vacuum cleaners, some of my clothing. I pray they survive. They could use a major makeover, and some kind of draw to get people back in. Maybe they could bring back the hot popcorn and peanuts and quality candy counter.
In fact, right now, I would drive a ways for hot, roasted, salted cashews.
7
My first experiences at Sears were annual visits with my mother to buy my school clothes. I buy my kids clothes (some, not all) through Lands End. Spinning off Lands End seems like a critical misstep -- credible product line, repeat business, and a perfect platform for the online / digital presence Sears lacked. Most Craftsman/Kenmore/Die Hard customers are not buying those expensive products online and are NOT looking to replace them each year. Apparel's a great online platform.
I shop Sears for kids toys and basic sporting goods -- they stock the relevant stuff at competitive prices. However, the in-store experience is much better at Target . . . Target's marketing has outpaced Sears for 20 years. Even JC Penney took steps to update their image a while back -- with mixed results, but at least a fresh approach was tried. If I didn't already shop at Sears, I'm not sure I would even be aware of the brand . . . it's that poorly marketed.
I read with skepticism a couple years ago when Sears announced it would sell store real estate to stem losses at underperforming locations and provide some cashflow, improve its debt situation, etc. OK, sounds like a plausible 21st century idea, but how would you retain the customers of those locations without improving your marketing and digital reach?
If the board allowed + supported all these moves, it seems that nobody at top levels really cared whether Sears succeeded or failed.
9
@Jim Of course they didn't want to succeed. That wouldn't be in the hedge fund playbook: buy a business, strip all its assets, declare the company bankrupt thereby being relived of the company's obligations to its suppliers and its employees and pensions.
8
Sad for Sears' employees that could lose jobs and benefits, however, retail is a brutally tough business of winners and losers especially with internet competitors. Bankruptcy may provide a way out but Lampert was a hedge fund hotshot with no retail experience. Lampert has a lot in common with Nardelli at Home Depot. Good retail CEOs are hard to find so when a financial guy takes over focusing mostly on cost cutting, the retailer is basically going into a long-term liquidation.
8
Sears is still around? I thought they went out of business years ago. Seriously, I am 60 years old and bet I have not stepped into a Sears store since my early 20s. I do not know even where a Sears store is located.
Maybe that had something to do with their bankruptcy.
4
68,000 workers. That's more than the coal workers! Maybe Trump can throw them some paper towels. Maybe they can get jobs working for all the steel factories Trump has promised will be back in business (none of them are).
This is what hedge funds do. Remember Mitt Romney and Bain? The movies like 'Wall Street' and the "greed is good" ethos? Repeated by Trump in his ghost-written books on how to get rich, like Trump University?
How Lampert wasn't stopped by a lawsuit or three when his hedge fund clearly had an interest that ran counter to what would have been best for Sears and their tens of thousands of employees is beyond me. Do corporations need an emolument clause to prevent them from being destroyed by the likes of Lampert?
17
A lot of mistakes were made to get to this point.
Sears made its name with catalog sales delivered by mail, not with stores in malls. Somewhere along the way it gave that up. Mistake.
Craftsman tools for example could have been sold on line, because everyone knows them and their value. Sears has many things of value that it could have sold on line, ahead of other on line operations. It just didn't.
9
Never have I wished for a stores demise - until now. Sears deserves to go the way of the Dodo.
2
Yeah... but in Chicago it is the vast and valiant numbers who still call the building at 233 S Wacker Drive the Sears Tower.
8
They needed someone with a huge business brain and superb deal making skills.
A go getter who could avoid paying any taxes and drive the company forward with foreign loans and foreign influence.
Someone who would go bust to avoid paying debts.
If only they had an orange dream team.
Luckily as you keep telling us your employment rates are on the up. Hopefully those who need it will soon be re employed in the coal mines and steel mills protected by national security trade tariffs
1
Reality check little history lesson but in great depressionin sears always provided good jobs paid living wage then whats up now? Not sears bankrupt its our country people cant afford to shop when there money is worthless. This the great deception where value american dallor worth lest then quarter of penny if we do math correctly in relation to gold standard dallor was once worth. There is hope stop all government spending on imports that where once made in usa. Dont get fooled agun stop spending dallors on imports if you cant make it in usa its of no value to use here.
1
That's like a rancher stripping and burning the corral's fences to keep warm, trying to create the illusion that all is well. With no fences, the cattle wander away and the ranch crumbles.
This seems to be the right-wing business model: Take an asset, strip out any valuable or saleable parts and reap quick profits. Then let the shareholders and creditors clean up the mess, then the PBGC and employees holding the bag.
Privatize the profits, but socialize the self-induced losses. Doesn't sound like a traditional American value....
11
No mention in this article about the human suffering created by Lampert's "finacial engineering." Retired and laid-off Sears employees in Canada have learned that they will not receive a pension after all. What a morally vacuous man.
16
Growing up isolated in the high Rockies long before the Internet was a gleam in some madman's eye, there was the Big Book. You'd look at it and dream. Not like a kid was going to get anything out of it. That picture to the right? Was almost always there. It seemed impossible that it could disappear - but it's gone. Like the New York Central, like the flickering little TV, like the black dial telephone, like Ma Bell herself.
You know why folks have gone crazy? All those things - were they idols as the Christians would say? The choice of mammon over God? What ever, the great towers have fallen and now we worship the 144 characters that appear on our Dick Tracy watch. No loss to the towers, but a life watching a 3" screen? No wonder the world is upside down. So few have learned to walk on their heads in that backwards sky.
And the worst? There is no wonder.
2
bottom line is that Sears was destined for bankruptcy but that end was hastened by Lambert, a "financial engineer" who managed to pull out value from the company for his own benefit. shouldn't he be in the Trump administration like mnchin his college roommate?
10
What a sad day
5
Lampert made out like a bandit.
12
One must truly be a megalomaniac with a leviathan ego and a stone for a heart to "succeed" in this day and age--it makes me proud to be just an ordinary citizen.
Goldman Sachs should be burned to the ground and it's management should be strung up by their heels for all the misery they have wrought upon this planet. It's the devil's workshop and its devotion to greed is unparalleled in scope.
And if I had my way I'd vote back into office in a heartbeat one man to lead this once great nation again, that is unless the honorable Mr. Jimmy Carter is to tired from selflessly serving humanity for that past 50 years.
God help us all.
8
100 years from now, some reader will be reading the same story, except, it will say Amazon instead of Sears.
3
@Sparky-
Fifteen years from now some reader will be reading the same story, except, it will say “United States”.
7
I renewed my warranties on all my major Sears appliances (fridge, gas range, central air and furnace) What's going to happen now ? When I need a repairman, will the number be disconnected ? How could I have been so stupid. When i asked a sears employee over the phone (January 2017) about the problems I've been hearing about them over the news. The reply the employee gave. "Sears is not going out of business, you'll be fine'.
1
@RWR-
Read the fine print in your contracts. Odds are these warranties are actually insurance contracts, service agreements between you and non-Sears companies for which Sears acted as commission-agent.
3
The progress of History can be as cruel as it is inevitable. Bye-bye Sears Roebuck; those who will miss you will soon be gone.
4
Awful thing to say
4
Sears actually wasn’t the original “everything store”. That honor belongs to A.T. (Alexander Turney) Stewart, an Irish immigrant who arrived in Lower Manhattan in 1823 and soon opened a store selling dry goods.
Twenty-five years later he built the “Marble Palace", then the largest wholesale dry-goods store in the world, on Broadway between Chambers and Reade Streets. In 1862 he built the "Iron Palace", a huge retail multi-level store economic historians regard as the first retail department store. A catalog mail-order business soon followed, the first ever established, an innovation copied by Sears Roebuck and Macy’s, among others, after his death.
He built an enormous French Second Empire-style mansion on 5th Avenue near where the Empire State Building stands today that later housed the Manhattan Club. He died between the 15th and 20th richest person in the world, his fortune easily as big as Jeff Bezos’. Amazon is a Digital-Age version of Stewart’s enormous, far-flung empire.
And hardly a soul knows about him today, any of it; except Bezos undoubtedly. If he has built a small secret shrine in Stewart’s memory somewhere on one of his palatial estates it would be fitting. He should, if he hasn’t. Stewart led the way. Bezos merely followed in his footsteps. But were you to walk up and down Manhattan and say the words “A.T. Stewart” to a thousand people most will say he’s either an actor or the rock star — including editors, writers and reporters for the New York Times.
3
You are more than kind to write Mr. Lampert's strategy "failed to attract customers...." There was no strategy to sustain the business. The only strategy was one driven by self centered greed. Pluck the best of the corporation, finagle a way to spin off, then personally invest in the plum assets, all the while running shoddy shops with threadbare carpet, miserable inventory, missing lightbulbs and frightened staff. And while we're at it let's put 200,000 Americans out of work. America First? No, Lampert First! A despicable display of avarice, aided and abetted by an equally greedy Board. A travesty.
19
Another example of a 'smart guy' imaging he is qualified to manage any endeavor he puts his hand to because..."I'm a smart guy!" (see Bill Ackman and Pershing Square w/Borders, Wendy's, Target and on and on)
The self dealing, in a supposed public company, is cause for SEC regulators to blush with shame.
And the little people get it in the neck!
And it is ever so, ever so.
8
I'm sure that Lampert, an Ayn Rand follower who enriched himself while accelerating Sears demise, will not be punished.
Too bad we can't sentence him to living on $10.75 an hour for a couple years - and then spending the rest of his life unemployed.
15
The creditors and stock holders should sue Lambert for every penny he has!
10
A few years ago, I tried to buy a $100 K-Mart Gift card for my niece. I had been buying Walmart, Amazon, and JC Penny's gift cards for years with no problem, but my niece liked the sales at the local K-Mart.
Well, for some reason their web site (and their customer service associates on the 800-number) would not take any of my credit cards, even though my credit score is over 800 and I have an unblemished credit report.
For my trying to buy it again with a different card, they black-listed me in their payment system. So I bought a JC Penney's gift card instead.
About 6 months later, I even tried to sort it out in person in a local Sears store before it closed. The associate tried to be helpful and spend about a half-hour logged into his store account to fix whatever the issue was to no avail. I couldn't even buy a $3 bottle of hand soap at the counter. My credit card (a new one) was rejected.
I have sworn to all my friends never to do business with these people again. Any enterprise with such customer relations deserves to be out of business.
@Linda sounds like there's a problem with your credit cards. I'm impressed someone spent time trying to solve the problem at a store for you!
2
Sears should have been the original 'Amazon' with such a history in catalogs and shipping (pre-Internet, that is Amazon). I am brokenhearted to see this icon fail.
4
I bought a Sear Reefer as usual and paid to have it delivered. The deal was to remove the 3-year old Sears unit to the basement and install a larger unit upstairs in the pantry; and it said exactly that on the sale contract.
The delivery crew refused to move the old to the basement - "only to garage or haul away, much too hot Senor". I called up and finally reached Sears Headquarters Director of delivery and Transportation who said, "Very, very sorry...just hang in there while I call your local Sears store and we'll get it taken care of quickly." Thirty minutes later he called back and said, "I can't explain it but the crew is allowed to simply refuse. Come to the store for a complete refund."
Six-months later Sears is filing for bankruptcy -- I wonder how many other delivery crews "simply refused"?
P.S. Lowes beat their price and even delivered and moved the small one to basement for FREE -- on Sunday afternoon!!
3
Sad, but not unexpected. Over 50 years ago I worked at Sears part time while going to college. I seriously considered a career there afterwards, but decided to go a different direction.
Back then, and for decades previously, Sears was a giant in the retail business. Built on a solid promise of "satisfaction guaranteed, or your money back", it was where you went to buy with confidence. Employees were knowledgeable, and seriously evaluated on product knowledge. That all disappeared, and relatively quickly, as competitors like K-mart and Walmart emerged. For the last many years you were lucky to even find a sales person, let alone one that knew anything!
Sears just didn't have an effective strategy to compete in such an environment against discount type merchants. Maybe there really wasn't a good strategy for them, but it certainly wasn't difficult to see where things were headed!
3
Ed Lampert, head of ESL hedge fund, is the reason this is happening. When he bought Sears in 2005 he had a master plan - the parts were worth much more than the whole as an ongoing business. Through his control of the board, he virtually stopped re-investing in the company, spending virtually nothing on improvements and "staying relevant" and immediately started selling off parts of the business that were worth something (credit card, brands, real estate etc) to profit the shareholders (of which he was the majority shareholder). This was his original master plan and it has, after 13 long years come to fruition., started his work with Sears Canada (which was a profitable and up-to-date company in much better shape than Sears Roebuck when he acquired it) which still operated a profitable catalog/online business which he also dismantled in 2014. It was a long, slow death - caused by his long term strategy - nothing else.
25
@North Easterner, that's how I read it, too. Rape and pillage, completely premeditated. I can't wax nostalgic, despite many memories of how Sears figured as a trusted retail savior in my family's life over the decades, after reading how Lampert has destroyed the company.
14
A few years ago, I wanted to buy a refrigerator from Sears, but first, I wanted to read and compare specs online. I had already compared various models for size, price, features, etc. online at Lowes and Home Depot, but there was no possibility of doing so at Sears. The Sears website was hardly better than one built by a teenager. There was no way to find out basic information like the refrigerator's dimensions, read customer reviews, look at images of the refrigerator from each side, etc.--the basic things sophisticated shoppers are able to do online at big box retailers. It was incredibly frustrating. I then attempted to call customer service, which left me on hold forever and was unable to give me any information. I ended up buying my refrigerator at Lowes. I'm not a person who would go out and spend thousands of dollars on a refrigerator without researching it first. Sears did not seem to invest any resources into online shopping, and still does not see the value in doing so, which makes zero sense for a retailer with a reputation for selling reliable appliances. I really wanted to buy another Kenmore (only sold at Sears) since the one I was replacing had lasted 32 years! I don't know why this article even refers to Sears having an online presence because it is in no way comparable to modern, online shopping experiences at Lowes and Home Depot. Such a shame that leadership at Sears did not see the value of investing in a competitive, online website.
12
A special prosecutor should be appointed to investigate Lampert's actions. It seems clear that he violated his fiduciary obligations to the stockholders, the bond holders, and the pension plan with his transfer of valuable assets to outside entities. He probably should have declared bankruptcy 5 years ago when he could have renegotiated bonds, leases, employee contracts and termination agreements. A restructured company would have emerged stronger and capable of competing with any rivals. Instead, he slowly bled the company and transferred its assets out to himself and loaded new debt which gave him rights ahead of other stakeholders. The current situation seems to have been his goal from the moment he took control.
17
The article fails to mention that it was Julius Rosenwald who transformed Sears from a small entity that just sold watches to the store that sold everything. Along the way, he also introduced profit-sharing for the first time in America, making hundreds of thousands of Sears employees far more economically secure than they would have been otherwise. He provided education and recreational options for employees as well and funded the Rosenwald Schools in the Deep South that built hundreds of schools for poor African-Americans where there were no schools for them to attend. Working with his partner on the venture, Booker T. Washington, the project provided the impetus for the schools to function as much needed community centers.
Rosenwald gave away all his money in his lifetime, his desire was to make life better for those less fortunate then himself. Chicago's ground-breaking Museum of Science and Industry was also funded by him. It is the largest science museum in the West. He saved the bankrupt Encyclopedia Brittanica and brought it to Chicago, where he gave it to the University of Chicago.
In contrast it certainly appears that Mr. Lampert's plan all along was to close the company in one way or the other and make off personally with its huge real estate holdings. He has now done so. Whereas Mr. Rosenwald felt an obligation to those who worked in Sears stores, its shoppers and many many others, Lampert is a poster child for pure greed.
27
Sears is finished. There is no point in Chapter 11, because reorganization won't save it. They were run into the ground by poor management. I can think of 2 other American companies that I think will be in trouble soon: Harley Davidson and Walgreens. I think both of those companies are also run by poor management and trouble is coming for them.
3
Most companies can only re-invent themselves once, or twice. The Sears catalog was disruptive, it gave customers a single source for procuring non-perishable goods. With the advent of the automobile, Sears made the transition to super-store. The Internet created a new portal for purchased. Had Sears pioneered with an Amazon-like presence up front, it would still be with us as a vibrant entity. Instead, it is dying a slow death.
2
My mother worked as a bookkeeper for Sears. We had a lot of Sears products in our home. When she retired she had the profit sharing income to supplement Social Security.
What struck me while reading the article is that Mr. Lampert's main goal was to improve his bottom line and with large amounts of money he purchased K-Mart and Sears. To make the companies profitable he sold off what was valuable to companies he had financial interests in, thereby enriching himself at the expense of the companies he ran. Typical hedge fund operations.
The thought that Sears should have expanded to the electronic market place should have been a natural but it needed leadership with vision. There were leaders out there that saw the e-commerce as the way of the future. The article states a meager e-comerce effort. Was the leadership aware enough to improve this area of the company? Obviously not. What is happening in the e-commerce arena is an attempt to expand the physical presence to facilitate quicker delivery. Sears had the physical presence well developed, the old-style catalog which could have been converted to an extensive on-line catalog able to compete with the now every larger Amazon. So much could have been done to compete but the only vision in laedership was the $
6
At best, Sears was too big to change, but small enough to fail. At worst, Lambert engaged in self-dealing that was not in Sears best interests. The fact is retail has changed dramatically with e-commerce. This will not be the last brick and mortar retailer to fail. Evolution's axiom: adapt or die.
The same fate as Sears, only faster, would have been in store for General Motors if Republicans had not crashed the economy in 2008, leading voters to elect a Democrat. Barack Obama used government funds to save GM, against the stated beliefs during the economic crash of none other than the 2012 GOP presidential candidate Mitt Romney. The Republicans, who voted against the government rescue, were OK with GM being sliced and diced, plants, patents, equipment sold off at discounts to their Wall Street donors. The government made back the money and more as taxpayers loans went to purchase stock in GM at the low prices of 2008, prices which later recovered.
5
I remember Eddie Lampert being hailed as a wunderkind. Some wunderkind. He ran the place into the ground.
18
When i was 20, and living in Hartford, Ct., i got a good paying job as a carpenter's helper for a big commercial construction company. I had no tools. On my first day on the job, the experienced men all said "go to Sears", which I did.
I got a Sears credit card ( nobody else would give me credit ), bought a craftsman leather tool belt, and filled it with a bunch of Craftsman tools, some of which i still have. You could handle the tools and feel the quality. I eventually paid off the tools quickly, avoiding interest. This process was repeated millions of times over by workers in the construction industry as we built this country. I'm sure Mr. Lambert would smirk if he read this, and say "Isn't that heartwarming."
27
Eddie Lampert and Carl Icahn: Icons of destroying icons (Sears, TWA) but they themselves come-out on top.
Gordon Gecko: "Greed is good."
19
So many commenters expressing disbelief that what Lampert and his ilk do is legal. Of course it's legal. They invested a fortune in legislators who made it legal.
Vote accordingly.
29
@Stenotrophomonas No it is not legal. The problem is nobody is prosecuting them. This is only legal in same way illegal immigration is legal. No enforcing laws doesn't make it legal. A single honest prosecutor could put him in jail.
2
Sears filed for Chapter 11 bankruptcy. That's reorganization, not liquidation.
Sears should stick to what it does best, tools, appliances, power tools, tires and batteries, electronics. Stay away from clothing and jewelry and fashion. No one goes to Sears from that, but if I need a lawn mower, a wrench, a drill, a car battery, a snow blower or a power saw Sears is my first choice.
10
Great points, Mike. As a professional strategist, it seems clear that Sears should rely on areas where it has, and can (re)build, competitive advantage.
Oddly, though, tools and appliances are exactly what CEO Lampert has sold off ... and wants to invest in. Ditto for Sears' real estate, and Lands' End.
Can the others on the Sears Board of Directors spell "conflict of interest"?
11
At what point do we take a look at the nature of corporate 'personhood' and realize that the decision makers for the corporation are not acting in the company's best interest?
15
"In the last decade, Sears had been run by a hedge fund manager, Edward S. Lampert." HEDGE FUND, FINANCIAL ENGINEERING, oh my. This could not have happened to a nicer guy. This is all part of the continuing demise of the USofA. Perfected by Mitt Romney and others who then ran for president and voila now we actually have a Grifter in office. My head continues to explode. Nothing, absolutely nothing surprises me anymore.
13
Gosh, I didn’t realize companies never failed in the old days!! Good thing hedge fund operators didn’t go after all those stagecoach companies, telegraph companies, Woolworths, Studebaker, Packard, Stanley Steamer, blacksmiths, medieval armor makers, etc.
1
Sears owned the home improvement and appliance businesses. If you wanted a quality tool or lawnmower, you got Craftsman. If you wanted a quality appliance, you got a Kenmore. They gave that all away to Home Depot, Lowe’s, Best Buy, etc., who had to build locations from ground up, often around the corner from Sears. As that happened Sears doubled down on their losing strategy by selling cheap designer clothes in drab stores. Did it ever occur to Sears to focus their stores on their dominant position in those two sectors? Apparently not.
Then the internet came along and Amazon replicated Sears’ original catalog business while Sears itself dithered in proffering a response. While Amazon had to work through UPS and establish a logistics infrastructure, Sears had inventory within a 30 minute delivery zone of a big chunk of the American public and ran their own trucks. Did it ever occur to them to leverage that as a competitive response? Apparently not.
It’s one of the most abject failures in America’s business history, and they have no one to blame but themselves.
14
The article does not mention how much compensation Lampert and his bros on the board received as they sold off the more valuable parts of Sears. The pattern is for hedge funds to borrow money to buy a business, sell off the valuable parts, pocket loans and cash and then leave others holding the debt and in this case hundreds of thousands out of work. Without paying taxes either! Capitalism is wonderful! Apres moi le deluge, as they say.
21
I have never shopped at Sears. The closest I ever got to Sears was riding (horses) with the CEO's daughter in the 60s . . . it may even have been the late 50s.
I saw this coming in 2005 when K-mart came out of supposed bankruptcy and bought Sears. That is the day good retailing ended in America.
Investors cannot run anything except into the ground. Their sole purpose is "profit uber alles", which includes shafting employees, not paying debts to contractors and stealing assets like pension plan money and every other "asset" the company has.
Thank Reagan. Thank him for destroying anti-trust laws which allowed competitors to buy each other out so the Robber Barons could rob us blind. Thank him for defunding regulatory agencies so the Robber Barons didn't have to deal with those pesky rules that kept/keep us safe. Thanks him for helping to break unions and put workers in their place at the bottom of the barrel. Thank him and every president since - up to President Obama - for unleashing insatiable greed at every level in OUR United States of America, just as their Robber Baron money masters ordered.
This is their non-competitive America. Retailing choices have dwindled to a few outlets - all overpriced - and the internet has allowed businesses to see what others are charging and raise prices for goods and services to ridiculous levels. Competition is essentially dead. Supposedly "new" businesses are owned/controlled by the same 1/10th of 1% of the population. We pay, they play.
It is simply disgusting.
20
Like most people my age (60) I was raised on Sears. I really don’t remember any other store we shopped at. But as a young adult in the 1980s, I became very disillusioned with Sears.
This was long before Amazon. The quality of Sears products seemed to be in decline. Meanwhile their salesmen were pushing hard for customers to buy extended warranties on major appliances. Warranties with prices that reflected one of two options: Either Sears was making a killing taking advantage of their customers...or the products they were selling were really SO bad that they needed to collect 1/4 of the sale price to break even.
And then there was Sears automotive. I didn’t know you could get your car serviced anywhere else. But after they stripped out my oil pan drain plug, neglected to tighten the bolts on my wheels after changing tires, and broke off my steering wheel (really)...I investigated other options.
In short, On-Line shopping may have hastened the demise of Sears. But the seeds of their decline were planted long ago.
I haven’t been in a Sears in a couple of decades.
10
@Fosco "Meanwhile their salesmen were pushing hard for customers to buy extended warranties on major appliances."
This is actually a pretty good point. The upsell alienates customers, and the employees who are forced to push them. It's an MBA-driven thought process that only looks at the numbers and not what the customer experiences.
5
Less competition is bad for everyone. The marketplace only works with more than one seller unless a monopoly is the goal.
4
This is exactly what can happen to a business when it's employees and customers are not considered by management to be stakeholders in the organization. It's all about the owners and management.
9
Sears. The original Amazon, where you could even buy a house. They were so dominant, so ever-present ... they missed so many chances.
Something should be done to stop Amazon from further gutting American "culture" of mall shopping. It isn't much, but it is worth saving. It gets people out of the house at least...
The smaller brick-and-mortar stores pay taxes, but not Amazon. Will Amazon start paying income taxes before it is too late?
And Trump is supposed to save Middle America? He and Jared Kushner are probably trying to figure out how to get part of the action...
10
We used to shop at Sears, used their handy catalog to buy clothes for our children. They're now in their forties, things changed, brick and mortar stores aren't very popular. This morning Trump, standing out in the rain with an umbrella that he kept over his head even when his wife walked with him, said it was due to mismanagement.....That from a 'business genius' that had four bankruptcies.
14
An interesting question is why capitalism did not lead to or enable Sears to “become” or evolve into Amazon. It is interesting to note that Sears had its start with the first US government created infrastructure of connectivity...the US Postal Service, when the Sears’ catalog put a huge dent into the collective retail market share of frontier General stores.
Somehow Sears managed to profitably make the transition to the very competitive department store retail model after WWII.
I can recall 20 years ago when Amazon wasn’t even close to making a profit and many believed it to be the sort of vulnerable trendy “flash in the pan” internet businesses that eventually went under during the dot-com bubble bust.
Was it decades of myopic short term “shareholder capitalism” thinking that sunk Sears and so many other retailers or something more structural?
Is Amazon now a retail monopoly or is it simply evolving into the role as a “for profit” agent of connectivity, linking customers to a wide range of competing retailers. My last 3 Amazon purchases didn’t even ship from Amazon.
2
What a shame. A trip to Sears, for our 1960s family, was a big event. My mom would always buy me 1/4 lb. of hot cashew nuts to eat, all by myself, every single time we walked into that store. Sears put the candy counter right next to the appliances and hardware at the main entrance.
I wonder why this article did not mention Sears' most famous brand? Craftsman. They offered a lifetime gaurantee, and they honored it too. I once returned an ancient pocketknife my father bequeathed me - I broke the blade prying a window open when I locked myself out of the house. No questions asked. "Here's a new knife." That sort of integrity, alas, is now mostly a thing of the past. I'll wager every single toolbox in America has Craftsman tools that are more than 50 years old.
I was sad when "Monkey Wards" went belly up, but I never thought Sears would fall victim to hedge fund hegemony. Mr Lampert and his cronies plundered and looted the greatest American bricks and mortar retailer that ever was.
18
The downfall of Sears started in the mid 60's.
1. When BancAmericard and MasterCharge came out customers could make big ticket purchases at virtually any store.
2. Sears failed to recognize the competition of discount retailers. The solution was to immediately start a new discount retailer, to have a non-Sears name but be wholly owned by Sears. The party line thought was "that line of business and product quality is beneath us."
In my opinion the man who came up with these two ideas was a genius. I do not know what became of him after we moved back to the US, but he was obviously ignored.
In my personal experience, I worked for Sears twice while a college student. My first job with them was in the credit department. It was a well organized and run organization.
I later worked on the sales floor in hardware in 1979. What a disaster! Sears had begun to offer discount, low quality tools along side with the lifetime guarantee Craftsman line. We were selling "K-mart quality" merchandise. Many customers bought the lower priced tools to save money, not realizing the carried no warranty. Imagine their reaction when the sales people could not give them a replacement tool when the cheap one broke because they had not purchased Craftsman. I heard many comments about that being "the last dollar I will spend here." This situation was being repeated in all lines of merchandise.
10
I currently live in a 100+-year-old Sears kit house and as a kid growing up in rural nowhere, almost every item in our home came from the catalog. But this is a simple story of adapt or die, and Sears did not adapt.
I'm not surprised to see the greedy Lampert was a pal of Mnuchin's. Amazing how all these soulless pirates who see Gordon Gekko as a role model gravitate toward one another.
19
The trends impacting Sears have been identified and talked about for over 30 years. This is not a surprise. Every board member bears responsibility. But here's the thing: most board members are go-along-get alongs. This should be an embarrassment for them, but it won't be.
11
I haven't been to a Sears since the early 1990's, when I was shopping for "professional" clothing for my first "real" job. I didn't buy anything... the clothing all seemed really cheap; the fabric stiff and synthetic, the styles somewhat dated. It's unfortunate, but this demise was a long time coming.
4
And the rich get richer off the backs of the working class. Lambert is a card carrying member of the 1% club who could care less about the little guy, along with his other Wall St cronies and gunslingers who delivered the long drawn out demise of this iconic American brand, running it into the ground while reaping hundreds of millions of profit and equity. I'm not seeing any tweets from the King of the 1 percenters, our president. Is he going to save these 60,000 plus jobs? No, he's not. He doesn't care either.
20
Try to find a sales person! The only place where there are one or two in our nearest store (30 miles away) is the large appliance section. On a xmas shopping day my husband and I waited 30 minutes for sales help after being told by a manager that he would get someone to wait on us right away. We don't know if anyone came - we left - and never went back, except to buy a refrigerator.
Why go to a store with few or no sales people?
4
Our first color TV was from Sears. Not a success. But the washing machine and fridge were great. I have not been in a Sears for years, but hearing this news makes me feel old.
5
In the early 1900s, Sears and J.C. Penney made an agreement; Sears would stay east of the Mississippi and Penney would stay west. Sears broke the agreement. Perhaps that misstep foreordained its problems.
3
I still go to sears. The one in a mall some distance away. I like the tools and the quality is not as bad as one would believe from all these news stories. They have a good range of appliances and lawn equipment. It’s the retail sales staff that is problematic. Never enough around to help you and answer your questions. Checkout time is like a trip to the license plate renewal obtuse center. I hope they make it. When shopping for appliances I go to sears and Best Buy. Compare and then make a choice. Usually I bought at sears. Amazon, glad I got you out of my life. Your a bad habit that was surprisingly easy to lose.
5
This is the exact behavior the Trump contingency should detest, and they have mistakenly selected a perpetrator of the same under the table dealings to champion their cause. It's classic Greek tragedy material.
7
I never thought highly of Sears, long before this bankruptcy.
We had purchased a rug shampooer, which worked great......a few times. It conked out pretty quickly. When we brought it in for replacement or return, they simply turned us away.
Around 15 years ago, I went in to buy a major appliance. I couldn’t find a salesperson, so I walked into the employee area. I asked the lady if she could help me buy a refrigerator. She said, “I’m eating lunch.”
No great loss.
4
@DavidG: having been on the other end, you might consider that the unwilling salesperson had been run ragged for the preceding hours, denied her break to catch her breath, and was simply standing her ground to get a few minutes of peace. At that point you no longer care about protecting the store’s reputation. You’re just getting through the day.
9
Using the words ‘unwilling’ and ‘salesperson’ in the same sentence is pretty much a recipe for disaster in the retail business. That woman lost a $2000 sale because she needed to finish her tuna sandwich.
1
Michael Corkery, can you help?
This article does not answer an important question. What will happen to Kenmore appliances? Many people still own them and the brand certainly continues to have value in the appliance market.
If Kenmore ceases to exist, not only retail, but manufacturing jobs will be affected, too.
2
More precisely, Amazon is a modern version of Sears rather than Sears being an early version of Amazon.
4
My thoughts are with the stellar Sears employees who have guided me to smart buys for more than 40 years. They and their families deserve better.
12
Business Darwinism in action!
The business landscape is littered with the corpses of companies that failed to adapt, but Sears is one of the most notable and dramatic examples. Though its death now seems inevitable, there is a chance that it may hold on as a zombie company. A few examples of zombie companies: Westinghouse, Smith Corona, Kodak, etc.
2
the last time I went to Sears was 15 years ago. The store was empty and looked very dated. They did have the tools I wanted. On another note, Ms. Mitchell lamented that she couldn't afford to live on what Sears paid and that Walmart paid more. Why doesn't she get a job there???
7
Way back in the mid 1990's, I happened upon a Sears store at a mall in Ohio where I was visiting. When I entered the store I looked around for a good 5 minutes for a salesperson to help me, to no avail. Finally, I found two Sears employees engaged in an intense conversation. They both seem annoyed at my interruption, but they answered my question, albeit reluctantly. As I walked away I remember thinking that Sears was on its way down. I'm just surprised they lasted this long.
5
Our first "credit card" was a Sears account way back in 1974. As newlyweds we shopped at the fabulous Sears building in Atlanta, built in 1926 and on The National Register of Historic Places. Those were simpler times. Anything that we might ever want or need could be found at Sears. Craftsman, Kenmore, Toughskins and more ... brands that were Made In America and the quality showed.
I've sadly watched the decline of Sears over the years. They just don't seem to have the magic formula anymore. Sears has even managed to run Lands End off the rails. We got rid of our Sears card a few years ago and haven't shopped in a store since. But when I pass one I feel pangs of nostalgia.
11
The US has more than six times the retail square footage per person than does Europe or Japan. The Sears fall has much to do with that, which also feeds into the failing mall real estate market. The US has too many large brick and mortar retailers, and with Amazon and the like moving the action to on-line it's going to get worse. In a falling market or highly competitive one the weakest competitors get taken out first. Any weakness in strategy, management, operations, or finance are severely punished. Sears had weaknesses in all four of those areas and failed.
Also note Amazon's insidious use of the US Postal Service and large headquarter location deals that take advantage of government services and lower taxes: the combination is unbeatable. Who is next?
2
@Phil...What is so "insidious" about using the best invention Ben Franklin ever had? It is still considered the "Gold Standard" around the world. And Amazon contributes nearly 10% of their gross revenue!
2
Sears will go the way of F. W. Woolworth's and the store chain that Sears bought some time back Kmart (originally known as S. S. Kresge) which has been happening for as long as this country has existed.
Any and all businesses that fail to change with the times will fail in the long run.
The only thing that could save it now is if it gets bought by some company that wants the name but not the product line, then it would become just like S. S. Kresge.
2
@BTO
Don’t forget Montgomery Wards.
@BTO It's funny but Dollar General and Family Dollar are essentially Kresge stores. They are making that "dime store" model work again
1
So a hedge fund manager/owner takes over a business that fails and recaps millions for himself....sounds all too familiar....!
26
When Sears moved its HQ to Hoffman Estates, IL, it drove the last nail in its own prefab coffin (page 666 of its catalog).
I drove the flat, grey, and seemingly endless 1 1/2 hour commute on I94 from Chicago on a couple of occassions for design interviews and thought to myself, “What a creativity suck. I am driving to Hell.”
5
@bonhomie. "page 666". Love it. You are creative.
Wow, a Trump level brand of " management ". I'm sorry for those losing their Jobs, but this is exactly what happens with Vulture Capitalism.
SAD.
12
@Phyliss Dalmatian
Mr. Lampert didn't help but Sears was doomed long before he came on the scene. That's how he got to take over.
7
I'm somewhat amazed that my fellow leftist wax so sentimental about a corporate giant whose main purpose is/was to make a profit. I almost expect one of you to say '...and I lost my virginity there'.
Although I don't defend Mr. Lampert on everything, he did take over the company that was already in decline, and, it can be argued, many of the former Sears employees still have a job because because he spun off their subsidiary company that would have been dragged down by a sinking Sears.
And those of you on the right who worship capitalism and think government is evil? Those of you who are Trump populists (an oxymoron if there ever was one)? 100,000 pensions are safe ONLY because of regulations of the bad old federal government.
15
@Thucydides
the Federal law protecting private pensions was signed because workers lot their pensions when Studebaker went under many decades ago. The only pensions not protected are those of public workers which are often funded below 50%. But that has not been fixed because it would be too expensive and would require changing benefit formulas
2
I guess if you are a hammer everything looks like a nail. Not everything needs to be viewed through a political lenses (particularly not one that only discerns cliches).
1
In retrospect, Sears should have evolved into Amazon. In fact, Sears was a partner in Trintex which became Prodigy - the original foray into the internet. I guess they just didn't see the signs. Isn't that's what CEOs are supposed to be getting the big bucks for? Now, Sears will just a business school case.
8
When Sears Canada went bankrupt,the people running the company made big money to close down the Canadian division*,while the average worker lost much of his/her pension**. Let Sears go to its well-deserved demise, and I don't mean heaven!
*https://www.youtube.com/watch?v=QRVsdQ21lRY
**https://www.cbc.ca/news/business/sears-canada-pension-retirees-1.4773283
4
How is this not a story of self-dealing? Mr. Lampert seems to have had one objective, and that objective did not include returning the once proud retailer to prominence.
13
Saw an interesting piece about a man who patented a new ratcheting type of wrench. Apparently Sears started making and selling the wrench, wholly disregarding the man’s patent. And from that moment on, I have never again shopped there. No, the patent was not mine, but I expect such treatment from Russia or China, not an American company. Needless to say, I am pleased they are going out of business.
3
My first job out of college in 1965, I went to work for Sears as a enthusiastic "management trainee" in a store in Middleburg Heights outside of Cleveland, Ohio. There were 5 other trainees, only one of whom the store manager favored stayed with Sears. The rest of us got ignored. The program was a joke, no training was offered, only assignments as clerks in various departments. The store manager mocked us as college boys and showed little interest in our development. He would attend meetings at Sears headquarters and bring back what I considered as novel retail practices sure to lead to failure. One example, he returned once to tell us in a store meeting that Sears would only offer its own products from now on instead of famous brands. In other words, Sears golf balls instead of Titlist. I left after 14 months, went to graduate school and got a Ph.D. Sears management practices bankrupted the company.
10
Sears was Amazon before there was an Internet. Was mail order sales using paper catalogs so very different? How could Sears management have let this happen?
6
"....the original Sears, Roebuck & Company built a catalog business that sold Americans the latest dresses, toys, build-it-yourself houses and even tombstones."
They also used to sell buggy whips and wagon wheels.
Give it a rest. I'm tired of hearing the same old repetitive stories about Sears. And no more comments from Lampert about how he's going to raise Lazarus from the dead.
3
Saw this movie in 1987. Gekko/Lampert knows that greed is good.
8
American capitalism at its best here, folks. Hedge fund manager takes over, squeezes every dime out of a company for himself and leaves tens of thousands of people out of a job, but he got his and a bonus for his trouble. This is what the electoral college voted for.
36
Does anyone believe the hedge fund that bought Sears was trying to save it? Buy it, sell pieces off, declare bankruptcy, close. Now repeat.
40
Sears was dying long before EPL took over.
Lampert lost a fair amount of money trying to keep Sears alive.
Sears grew thru innovation - product offerings, credit and low payment offers, auto service, and extended warranties among many others.
The latest innovation - SMY - was too little too late.
Let it die and RIP.
2
As a young child in the 1940s, the biggest thrill of the fall was when the postman delivered the Sears-Roebuck catalog and I could run into the house with it and find the toy section. All of my Santa gifts came from that catalog. But as an adult, the only time I went into a Sears store, I couldn’t find an employee to help me and I never bothered to go back. Wal-Mart became my go-to store.
7
Also an amazing story about missing the boat...they could have transferred their iconic catalogue into an online giant, long before Amazon!
7
I grew up wearing Sears clothes and shoes. My mother trekked between the two South Side Chicago neighborhood Sears stores on 79th and 63rd Street. She put things on lay- away and paid in increments. She had a small bank savings account.. but no checking account. She paid in cash or got money orders, She had a Sears credit card. All of our electronics and appliances came from Sears.
15
@Blackmamba
Same here buddy. Sears was close by to our house. It was the go to place for just about everything. We bought lots of stuff out of the catalog and picked it up at the store. I loved the Christmas catalog and would pick out which science toy I would get for my birthday and Christmas. Then they closed the local store and just had suburban stores.
5
Running a good company into the ground, I am sure Mr. Lampert is doing very well where compensation is concerned.
24
@Don Juan
Actually Lampert lost a fortune as well he should. He is a primary lender.
So, this guy Lampert assumes control of an iconic brand. He drives it into bankruptcy, then slices it up and keeps the good parts for himself and his companies. He leaves tens of thousands of people unemployed. The article forgot to mention how much this financial genius took home from this amazing deal. Maybe next he should run for president.
31
I used to shop at Sears for hand tools. We had a wooden-floored emporium in Danbury, CT. Merchandise was at eye level and you did not need a ladder to get to it. The biggest blow was when they sold off the Craftsman label. Sixty years ago, when I was 13, my granddad bought me a set of Sears 'starter' tools so I could maintain the home I shared with my mother; now we shop at the warehouse stores like Home Depot or Lowes and hope to find a ladder.
3
Sears is bankrupt in the same way my car would be stuck in my driveway if I sold off the tires, engine, radio and transmission. The business did not fail, any more than Toys R Us failed...they were taken apart and a very few people took the good bits away. There was never an attempt to fix anything...and my last trip to Sears to get a tool replaced (If you can't buy Snap-On, buy Craftsman) produced a demoralized employee who told me that my broken socket would be mailed from a central location....not replaced on the spot.....Vulture Capitalism at its' finest.....
22
Mr. Lambert is the number one reason for Sears destruction. His goal was to decimate the retail for the real estate. So, he made no investment in updating stores, stocking shelves, paying staff or making a real attempt at any sort of online presence. Instead of attracting customers with their rewards program, they drove customers away with badgering incessant emails. This may come as a shock to Millenials, but sales staff in stores like Sears were once professionals. Yes, retail was a serious profession with high standards and staff that was well-paid, with benefits paid by department store owners, bonuses, and pensions. It was workers who carried retail alongside owners who actually cared about their stores and staff, and were themselves retailers. Sears and Lambert are the epitome of the Ronald Reagan Era. Profits before people, customers be damned.
29
This seems more an example of a vulture capitalist stripping a company of its most valuable assets than a failure due to competition from Amazon.
30
The last time I went to our local Sears store, which closed very recently, to look for a screwdriver, the only employee I could find was sitting in a chair sound asleep. Seemed to reflect company management, except Lampert surely was awake enough to make sure his pockets are well-lined.
20
I’ve been shopping at a local Sears store for over twenty-five years. In all of these years, the store was never updated while all around stores were renovated and made more appealing. Despite its shabbiness, there were always shoppers in the store. The sales people were courteous and helpful. The true villain in this story is Mr. Lambert who siphoned off most profitable parts of Sears and invested nothing in these older stores. It is the sad story of hedge fund greed where profits go to a few and stores, customers and workers are left to languish. I’ve been following this story for quite some time. It angers me that when Sears closes its doors, Lambert and those of his ilk will continue to profit, while so many will be losing their paychecks, and others will be losing an affordable place to shop. It is callous, reprehensible and immoral. And yet, remarkably, legal. It’s simply infuriating.
40
OK, I understand the sentiment of folks who mourn the loss of an iconic business that many grew up with. But, blaming it on Wall Street, rapacious hedge funds, evil politicians, etc., is simply a reflection of the current overheated political atmosphere. Sears is bankrupt because it failed to adapt quickly enough to changes in the marketplace, the effects of technology on retail behavior, and customer preferences. Just like Woolworth’s, BonTon, vaudeville, etc. This has happened hundreds of times throughout history. What happened to stagecoach companies when railroads arrived? What happened to telegraph companies when the telephone arrived? What happened to armor makers when guns arrived? What happened to the neighborhood blacksmith when cars arrived? What happened to good ol’ hunter gathering when farming hit the big time?? Sorry folks, but this is very common, and very normal.
3
So incredibly cynical to portray hedge fund managers plunder an iconic company for personal enrichment as "normal". Maybe it is, but that's really depressing.
8
Sears failed because of lack of LEADERSHIP! The known practice if hedge funds is to extract as much cash from the selling off profitable assets, charge huge upfront management fees and not trying to be competitive.
4
These comments are not a reflection of the current political inmate. Taking over companies, stripping out valuable assets and selling them, and feeding the profits back to the investor rather than investing in the main brand has been going on for decades, since the early corporate raider days. Also, retail is not dead. That analysis is old. Best buy. Costco. Walmart. It's just plain mismanagement and stripping the business to the bones. This has been a 10 year slide. I stopped going to sears because of customer service, policies, and inventory back then.
6
How does the way that Mr Lambert has extracted the value and assets from Sears for his own benefit differ from the way that organized crime would gut a business?
29
@Roy Because Wall Street and organized crime are the same thing.
13
Considering the players in this, this appears to be the love child of our CEO "culture" combined with media celebrity, even if such "celebrity" equates positive achievement for what used to be known as "ill fame."
7
One of the most valuable assets of Sears was its Craftsman tool line. They were US-made and had a lifetime warranty. But they spun off the name, other stores (like Lowes) sell them, and the tools are now made in China. Who in their right mind would pay a premium for a set of wrenches with the Craftsman name, when it no longer means anything or has any differentiation from any of its other low-end competitors? The executives killed Sears. If I want a set of cheap Chinese wrenches, I'll save 50% by driving over to Harbor Freight rather than pay extra for the now-worthless Craftsman name.
35
@Jim
If you're careful Harbor Freight can be a good deal. I wouldn't buy some of the stuff for commercial use but for the home handyman they're a bargain.
1
A lot can be said about the destructive nature of a hedge fund guy taking over Sears. However, from a personal point of view, I can say that I would only shop at sears for tools. Sears clothing lines for this 71 year old have traditionally been tacky & retro. Try to find natural fibers or less traditional designs. I remember rebelling in high school because my father wanted me to buy loafers for school at Sears. Yuck! Eventually I won and got the Weejuns. While they have tried to upgrade their clothing they haven't kept up with the times. Result: Too expensive for bargain shoppers and too cheap in substance for those in pursuit of high quality.
6
What happened to Sears is just an evolutionary tale. In all forms of evolution there are winners and losers but there is adaptation and improvement along the way. Sears had a very good and very very long run . Hats off to the founders and administrators of Sears for their many years of advancing consumer experience but now it’s time to adapt and change .
If anything there is a return to smaller stores through platforms like Shopify and Square.
I wish Mr. Lambert had to work at a Sears store for a year in order to lead it. Really stand around five days per week like a regular employee and observe the transactions. I worked in production in Los Angeles for twenty years and had to shop professionally.
Walking into the Santa Monica store was so depressing (as much as I admired the wonderful exterior architecture), the inside of the store was charm-free and poorly merchandised. Finding an employee was challenging, and when you did manage to engage someone to ring you up they were miserable and untrained. Buying a few pairs of Levi's could take an hour. The whole experience was so dysfunctional; comparatively the worst retail customer service I have encountered. Twilight zone atmosphere. I couldn't imagine how they stayed open. Someone who cares needs to be running the ship for any brick and mortar store to be successful in today's competitive marketplace. Proprietors need to invest in managers with some skin in the game.
12
Edward Lampert should be in jail.
22
Mr. Lampert seems to benefit from everything Sears sells off. It's as if he were brought on to destroy Sears. After he leaves he might as well work for the Trump administration where people are hired who detest the department or agency they work for.
23
So remind me again WHY I as an American tax paper should help this man out? I say seize HIS assets and pay off the employees and then the debts in that order..
47
Sears could have had it all. They could have been what Amazon is today. They had a nationwide chain of stores that carried everything, and a nationwide catalog business. All they needed to do was break into e-commerce faster to make that catalog online, and expand their online inventory. They already had the nationwide warehouse and physical infrastructure that Amazon is scrambling with great difficulty to establish today.
14
When one allows the fox in the hen house carnage is the result.
Time after time when we see businesses taken over by hedge funds, such as Mitt Romney's former company, the end result is liquidation (after consuming much of the cash those companies may have on hand) and the loss of jobs (those jobs that Trump always congratulates himself over).
Lambert did little good for Sears, and Kmart, over the years. Those remaining stores should just close their doors to rid themselves of the pain of their slow death.
23
On a personal note, when I was a kid, Sears also sold musical instruments through their catalogue, But, many of their stores also had some in stock; electric guitars in particular, sold under their in-house "Silvertone" brand ( same as their TV's; radios and record players).
I couldn't play at the time but the sight of one electric guitar, which had an amplifier built into the carrying case, fed my musical dreams; hoping that my parents would cave into my wishes and get me one for a birthday present.
It never happened.
Their guitars and amps were a staple in many pre-teen and early teen garage bands of the day, until some lucky kid's parents or grandparents pony'ed up the money for a guitar, amp,or both from a major brand like Fender, Gibson, Gretsch or Guild. But, I digress.
It's been decades since Sears carried instruments for budding rock musicians.
Between that, and the catalogue no longer published, it really is the end of an era.
Hail, and farewell!
13
@Dave....Just Dave - Another fun fact: Sears also owned and sold Harmony acoustic guitars. For several years Harmony was largest acoustic guitar manufacturer in the US. Jimmy Page used a high-end Harmony to record the acoustic songs on Led Zeppelin III.
12
I don't understand all the sobbing and sentiment over the demise of Sears. 100 years ago, Sears retailing strategy laid waste to untold numbers of small stores and destroyed the lives of the hard working people who owned and worked in them. Now Amazon and other internet retailers have put Sears in the barrel, and soon they will have disappeared like all those mom and pop stores they wrecked. That's life.
12
Ecommerce is not the only contributing factor in the demise of retail icons. Hedge fund activists like Lampert and Ackman have left a trail of destruction in their wake. Iconic US companies like Viking are now on the ropes due to massive conglomerates like Middleby Corporation buying them up and then slashing their workforce and operating capital.
9
There's no good reason Sears didn't become a successful combination of Walmart and Amazon. There's only a bad reason: blatant asset-stripping by a self-serving controlling shareholder. Of course, there were and will be lawsuits about this. But they're easily settled by paying off the lawyers who bring them. And the strip goes on.
26
More coverage please on the impact on worker pensions and retiree pension and benefits. Also on bankruptcy and prior filings on Sears, Canada. And the possibility of Canadian government inquiry into self-dealing?
13
Is it just me, or is there something suspicious about Mr. Lambert's post-acquisition strategy of spinning off Sears' most valuable assets, in which he conveniently owns a sizable chunk, leaving a hollowed out shell wending it's way through bankruptcy?
29
@Greenfish you aren't imagining it. It's his modus operandi.
5
Somehow you omitted Julius Rosenwald in your history of Sears. He was an innovative merchant, grew Sears into its most successful period, and was an early advocate for social justice, and education for minority communities before Brown v Board of Education struck down separate but equal.
His legacy should not be forgotten in the sad decline of Sears.
19
It is sad to see the people from Wall Street destroy America. The ceo in charge Mr. Lampert, a hedge fund manager came on board and destroyed a hundred thirty year old company.
This would not happen in Japan, Korea, or any industrialized country. It shows once again that the economic crises in the country always originate in Wall Street. The "Great Recession" of 2008 case caused by Wall Street.
Why hire a ceo with a twenty million dollars salary, then he will destroy the company? This is the decline of our country.
20
@Templer and starting with Ronald Reagan, we let it happen.
5
@mack, yeah Reagan said he was going to change our countries economy from manufacturing based to service based. That's worked out real well for the gutted small towns from coast to coast
3
I had always purchased Kenmore's Elite series of appliances...they were always the best designs. But I have stopped. Who can trust that brand when people like Mr. Lampert are running the show.
4
Vulture capitalism in action. Well done Lambert!
12
So much for that lifetime warrantee on that Craftsman spanner I purchased forty years ago!
8
I'm too young to feel any particular nostalgia for Sears. Big-box stores and early online retailing was already firmly in place by the time I was making my own shopping decisions. I can only remember going inside a Sears once and I was giving a friend without a car a ride. Even before Lampert cannibalized the company, Sears had already lost significant value in generational relevance.
Lampert obviously made things wore. Personally, I think he's guilty of lying to shareholders. He never had any intention of bringing Sears digital. You should have seen their inventory management system. There is absolutely no way Sears was going to become competitive in online market without completely overhauling the inventory and distribution systems. Lampert obviously wasn't making those investments. He was slow walking liquidation for personal gain.
That said, the Sears brand still holds value. Maybe some ambitious entrepreneur is willing to take the brand and rebuild the company from scratch. Sears has the potential to become a phoenix from the ashes. Wall St. hedge fund managers are obviously the wrong people for the job. However, the idea is possible.
In the mean time, I'm waiting to see what my city does with the abandoned Sears property in the middle of town. Before, we had an unprofitable hunk of concrete taking up real estate. Now we have an empty hunk of concrete taking up real estate. I think we can do something more interesting with the space.
11
@andy. Ideally it should be reporposed for affordable housing but the wealthy will never go for that. Probably will be turned into luxury condos eventually.
1
I was glad the GOP put in a requirement now that Amazon has to collect sales taxes from each state. Now with the sales taxes , mail costs and higher 15.00 wages Amazon won't be an affordable store anymore. This should have been done before we lost Sears. Just like Trump is allowing 55cent postage stamps soon that business will be out of business. At least for me. I hope the stores will be hear to stay now that it is costing more to shop on line.
@D.j.j.k. Amazon is still my "go-to" store. I don't mind paying taxes, I have "Prime" which means my shipping charges are $120.00 a year for 2nd-day, and I almost always get exactly what I want. If I don't, Amazon accepts my returns without argument or hassle. Amazon's customer service should be emulated by every retailer in America. Amazon is not run by a hedge fund manager. Maybe that's why it's successful - - it's business model is truly customer-centered.
4
@JL22
The NYT's had a recent article that Amazon was getting very nasty to many customers and suspending their plans when they were returning items. They keep count and you will be suspended if you return a few to many items. Then you will be out all that expensive payment for mail. Great shopping experience ahead for you. Give me brick and mortar stores any day.
2
It's interesting so many commenters are blaming Amazon and the internet for Sears' decline. I remember in the early 90s Sears was doing quite well selling clothing, appliances, hardware, and automotive.
Amazon is relatively weak and all of those categories. You can't get your tires rotated at amazon.com. And you're not likely to order a washing machine there either. Or shop for shoes.
Walmart, Home Depot and AutoZone killed Amazon. Stores that, especially in Walmart's case, are notorious for emphasizing low prices over quality of construction.
A widget at Sears might have cost more than it did at other stores but at least it didn't break 6 hours after the one month return window closed like Walmart.
7
@kraidstar
What really killed Sears was its miserable customer service. Almost thirty years ago I tried to order some items from the Sears catalogue. The customer service I experienced was miserable, to say the least. When I moved to the suburbs, I sometimes did shop in the stores, but customer service was lackluster and the inventory and the prices were no longer competitive. I am surprised Sears lasted this long.
1
@kraidstar Do you understand what Amazon does at all? About half (44%) of all online purchases in the USA are made on Amazon. Amazon is the #1 online retailer of shoes in the USA. They are probably the #1 online retailer for all of those other categories you listed too. Why wouldn't you buy a washing machine from Amazon? They will deliver an item that is burdensome to transport, for free and install it for free. They will even haul away your old unit.
2
This really is sad. When I was a child in the 1960s, getting the Sears catalog in the mail was the grand retail event of the year. The whole family gathered around to see what was new and trendy. That catalog was more dominant in its time than Amazon is today.
9
The real losers in this story are North America's downtowns, which were first devastated by the move of department stores to the suburbs, then cleared out much of their irreplaceable history to lure such stores back downtown, now to see them shutter again. The damage to the urban fabric caused by the rise and fall of Sears (and The Bon-Ton, Eaton's and the rest of North America's shuttered department stores) is incalculable. Amazon and Walmart may replace the actual shopping, but what will fill the physical void? There simply aren't enough City Targets to go around.
7
I thought there were laws against interlocking directorates. Not in these times. Mr. Lampert's holding companies strangle Sears and force it to sell, at bargain prices, valuable assets to other companies controlled by Lampert. In the meantime, his Sears ownership suffers huge losses that he can deduct from his tax burden. Isn't capitalism great?
29
I don't know what will happen with the Sears' bankruptcy but the Toys R Us case is instructive.
When a large company declares bankruptcy there are usually huge legal fees.
With Toys R Us legal fees were estimated at about 348 million.
Workers' severance would cost about 75 million.
But instead of reducing legal fees by about 20% [lawyers would still be over paid] and using the money saved on legal fees to pay workers' severance the workers will get no severance.
I don't know what will happen to Sears' workers.
Bankruptcy laws must be changed so workers have FIRST claim on the company's assets.
22
I remember how my German-Russian gran'mom used to love being taken to Season dRoebuck. And that huge catalogue. Long ago.
7
So the head of Sears sells off company resources to a hedge fund that he owns?
Seems unethical, if not downright illegal.
76
Sears customer service is deficient.
Contrast my experiences with Sears and with Amazon.
I ordered a small $10 item from Sears on line.
When it failed to arrive I called Sears. They said it was delivered.
And in effect F### Y##.
Never got it.
With Amazon when a small item failed to arrive I called Amazon. The next day by overnight FED EX Express replacement arrived at no extra charge to me.
Guess which of the two companies I ordered from after these experiences.
13
Sears grew by killing thousands of small businesses in the first half of the 20th century. People wanted to buy everything from one store and catalog and the mom and pops couldn’t compete.
Eventually customers preferred to buy clothing from clothing boutiques like the Gap and toys from big box stores like Toys are Us. Super discounters like Walmart and Target emerged and siphoned off customers. Malls became the place to buy everything and Sears was just one player. Amazon and the retail apocalypse just finished them off.
In the 1960s, management foresaw difficult days ahead and diversified into Allstate Insurance, the Discover Card and a stock broker. But the underlying problem is Sears became a portfolio that included winning companies, valuable real estate and a drowning department store chain. Lambert separated the winning parts from the losing.
Sears is one of the last of what was once hundreds of department stores in the U S. The department store concept has been dying not just in the US but worldwide. Times change and new people don’t want what their grandparents wanted.
3
Sears is where my parents shopped so I did too. But over the years I noticed service was slipping. I had bought some lawn and garden equipment form them and they lasted as expected but when it came time to buy replacement parts they told me sorry they don’t carry that any more. I was dumbfounded,I spent 400 bucks and 5 years later I can’t get a 2 dollar part to get it running? Yeah that’s right. The parts guy said. I asked what I was supposed to do. He calmly said “Buy a new one.” That’s all it took I wrote a good letter to the company (which never responded) and vowed never to step foot in there store again and by they way I told them if they keep treating customers this way they’ll go out of business. Nice to see after all these years I was right.
8
Nostalgia aside, Sears failed for the same reason it succeeded for so long. Sears understood that people will talk all day long about "store loyalty", but if Sears could sell a lawnmower for $10 less than the local "lawn and garden" shop, people would opt for the savings. Now that Amazon has figured out that brick-and-mortar costs more than warehouse-and-delivery (and customers like to order from home - something Sears historically understood), Amazon ate what little was left of Sears's lunch.
The Sears model worked for years, and killed thousands of small businesses along the way due to Sears's efficiency and scale. Dog-eat-dog worked just fine for Sears. Until it didn't.
13
And the saga of financiers buying and killing going concerns continues. Hedge funds and private equity still think they can buy a good (or at least decent) company, load it up with debt so they can remove millions for themselves, and then let it rot because there's no money left to remain a going concern in this age of the internet shopper. You'd think it would dawn on them that they're the real problem. Ain't greed wonderful!
28
@DBA
They *know* they're the real problem. They don't care.
2
It is a shame to see this giant retailer of both mail-order and brick & mortar stores go down the drain. If only they had developed internet marketing, Amazon might not be the only game in town.
We are increasingly becoming a nation of monopolies...buoyed by the corporate GOP interests who are forever hawking "freedom of choice".
Where is our freedom in broadband, banking, health care, cell phone services, etc., etc., as more and more of these companies are bought out or go bankrupt.
I remember when Coca Cola was Coca Cola.
"Coke makes so many different beverages that if you drank one per day, it would take you over 9 years to try them all. Coca-Cola has a product portfolio of more than 3,500 beverages (and 500 brands), spanning from sodas to energy drinks to soy-based drinks." They own: Coca-Cola (Coke), Diet Coke, Coca-Cola Zero, Sprite, Fanta, Dasani, Ciel, Smartwater, Minute Maid, Simply Orange, Del Valle, Powerade, Vitaminwater, Odwalla, Fuze Beverage, Honest Tea.
Insurance companies are buying each other out, T-Mobile just bought Metro PCS. Charter has gone into mobile phone service.
Monopolies rule.
Vote Nov 6, or better yet, VOTE EARLY. In NC early voting starts this Wednesday, 7 am to 7 pm until Nov 4.
15
Meanwhile Lampert will walk away with his billions and a tax carryforward that will protect him from income tax for years. It makes you understand why so many people are disgruntled. What I am waiting for is the disgruntled masses to discover they have been duped my Comrades Trump, Mnuchin and Lampert.
63
The good news is that you can be absolutely certain that Lampert pays nothing in taxes.
52
It really begs the question of how could someone mismanage such a great company right into the toilet? Sears could have adapted and Sears could have prospered but instead its owners decided to sell off the best parts of the company which left nothing to salvage. This is a great cautionary tale of why you don't want a hedge fund running your company.
44
When I was a kid the thought of Sears filing for bankruptcy would have been crazy but we live in crazy times I guess.
6
Sears dies while Mr. Lambert smiles. It goes to prove that hedge fund managers know nothing about the retail business. RIP Sears, I will remember your catalogs fondly.
27
The it should be some type of intervention by the government to prevent people like lambert from mining wealth from such companies. This is the core of what is wrong with our economy where such people are rewarded financially for destroying a source of jobs for personal profit.
34
In simpler words, Sears did not fail -- Mr. Lampert killed it.
So much for a wall street trader attempting at real business.
Seems the same thing is coming from the oval office.
51
@bcer In 2014, Peter Myers starred in a Sears commercial with his brother, comedian Mike Myers.
It featured both Myers brothers using humorous banter to spread the message that, despite rumours, Sears wasn't shutting down. Three years later, Peter was in a conference room with colleagues being told by a Sears official that they were being laid off because Sears was restructuring. The employees were not told in the meeting that they would not be getting severance. They learned that when they opened information packages they picked up on their way out of the room. Peter was a Sears employee for 35 years. “The Softer side of Sears”, indeed.
15
How do people like Lampert stay out of jail? Why do we let them stay out of jail? The people who ran the big banks, AGI and the others, some committing illegal acts, suffered no repercussions. Really, why do we let this happen? It is obscene.
53
Hiring people like Mulvaney to run the consumer financial protection Bureau into the ground and giving tax breaks to the richest 1%, that’s how.
18
Me. Corkery traces the retail impact of Sears, but he neglects to mention its social justice impact. Julius Rosenwald, then the president of Sears, partnered with Booker T. Washington to build community-owned schools for African-American children throughout the South. By 1932, those schools educated 1/3 of all African-American children. They nourished generations of African-American community, and also educated many leading African-American artists and leaders. As we reflect upon Sears, let’s not forget the brightest light it shone.
39
I can only speak for myself, naturally, but I haven't thought about SEARS as a source for shopping in a long time - well, practically never. The one time I recall going to SEARS was about 30 years ago when, in high school, I needed to change the tires on my car and I had my father's SEARS credit card so I went to a SEARS Auto to do the work. As for fashion or home good, the availability of Macys or Target or Walmart or Pennys or just about any other company in business today is more readily available as an option and have much better product assortment so the question is a simple one: if others share my view then how has an irrelevant retailer lasted THIS long?
4
But why did the internet conquer the brick and mortar stores?
Because the stores stopped printing and mailing catalogs. I used to spend lots of money at Radio Shack after thumbing through the catalog and spontaneously going to the store to but what I saw. Catalogs work! Start printing and mailing. There's more to be seen and sold than a website page.
7
Whenever I shopped at Sears the prices were way too high. This was true on just about everything. A pair of pliers that would cost $3 at Walmart cost 8.99 at Sears. This, combined with the fact that the shelves were seldom restocked, ended my lifelong habit of shopping there.
7
After the 2020 elections pensions will be cut. they just want to give time for people to forget about the company and move enough money around so retirees can't stack claim to it.
8
Lampert sounds like Trump, just more intelligent. He bankrupts a company finding, along the road to bankruptcy, a way to make millions for himself and his friends, like Mnuchin.
44
Let's give this a couple more years after the 2020 elections.
1
One man's greed caused all this destruction. That's all you need to know. Another member of the "too much winning" circle.
37
How people like Lampert sleep at night has got to be a marvel of the medical world.
24
So sears has 68,000 workers - that’s more than all the coal miners in America. Where’s Donald Trump?
119
He doesn't care because retail workers are mostly POC and women. Not his base.
26
@Jax
Famous lines spoken by Donald Trump:
"Just what ARE soybeans anyway???"
"Here are some paper towels! Catch!"
"What IS SEARS? Why would people mow their own lawns and wash thier own clothes?"
"Coal is clean!"
"Who knew health care could be so hard? "
Most recent: While stomping his foot and rosebudding his lips.....harumph, harumph, harumph.....
"It's OUTRAGEOUS what happened to that journalist in S. Arabia! (NOT...wish it was all of CNN, ABC, NBC, CNBC, EVERY reporter except FOX entertainment staff....)"
1
One comment here states:
"Typical short-sighted Republican thinking is what has doomed these retail dinosaurs.”
Why is this “Republican thinking?” Is this commenter so prescient that he foresaw that Apple and Amazon would become trillion dollar businesses? That the Internet would provide the world with so much online shopping that one doesn’t need to EVER leave their homes?
I am very saddened with the closing of Sears! My dad lost his job as a middle level manager and went to work in the furniture department of Sears when I was a newlywed home from the Vietnam War. As he did with all young couples he led us away from the more expensive sets that were displayed at the front of the store. Instead he found us a refrigerator with a ding in it, sofas, dining set, bed--all with small defects. After raising five kids he understood that scratches and dents didn’t mean much. Dad was an honest salesman and he made a good living.
I remember he also told us that the hardest credit card to get was a Sears card...more important than a card you had to pay for like American Express. He was right.
Craftsman tools--replaced for life. Who didn’t have a red tool chest? When I helped set up the first ICUs we used their tool chests for our emergency carts.
Sears meant quality! Now we have big box stores such as Home Depot with names of tools I don’t recognize. My sewing machine, tire center and auto maintenance. First stop was always Sears.
To everyone bashing Sears--please don’t.
24
@Nuschler "I remember he also told us that the hardest credit card to get was a Sears card...more important than a card you had to pay for like American Express."
This middle-finger to customers probably helped place Sears in the position it finds itself in today. Broke and with no customers.
2
Gordon Gekko could never hold a candle to Edward S. Lampert. It’s a shame Sears’ corporate board failed in their duty and did not stand up to him. We can expect to see more corporate raiders/pirates like Lampert and iconic American stores/brands going bankrupt as a result.
RIP Sears. You brought a lot of magic to my childhood.
15
Amazon has no quality or value.
Sears does.
2
Yet another story of thousands losing their jobs whilst a CEO (in this case Lampert) walks away with hundred of millions. Hey Republicans: when you rip into people on welfare remember this: it’s people like Lampert - not laziness - who put them there and yes, you are now paying for it.
32
A touching, greedy textbook case of American Vulture Capitalism 101.
Destroy a great American company; line the pockets of the rich in the finest gold.
"Sears had been run by a hedge fund manager, Edward Lampert, who sold off many of the company’s valuable properties and brands but failed to develop a winning strategy to entice consumers.
Sears spun off Lands’ End, the preppy clothing brand, into a separate company, which Mr. Lampert’s hedge fund took a large stake in. Lands’ End market value now dwarfs that of Sears.
In 2015, Sears sold off stores worth $2.7 billion to a real estate company called Seritage. Mr. Lampert is a big investor in that company as well as its chairman. Seritage is converting many of the best locations into luxury offices, restaurants and apartments.
Mr. Lampert is also seeking to buy the Kenmore brand from Sears for $400 million.
Even in bankruptcy, Mr. Lampert will have great sway over the company’s fate. His hedge fund owns about 40% of the company’s debt, including about $1.1 billion in loans secured by Sears and Kmart properties. As a result, he could force Sears to sell the stores or transfer them to him to repay that debt.
“Lampert will make out,” said Mr. Olbrysh, the retired Sears worker. “There is no question about that.”
-----
"Drop dead, Sears, Sears workers and Sears customers ! I got mine !"
Nice people.
44
I don't know where to focus the blame. The internet, sure. Bad management, definitely. Hedge fund greed, of course. All I know is that slowly, inexorably Sears became a sloppy store that sold mediocre stuff. That's the business model if the mission is to extract what remained of value created by decades-ago owners and dedicated Sears employees. Yesterday it was Craftsman and Kenmore, today it's financial engineering and tax loopholes.
13
@MWR I don't think the Internet was the primary cause of Sears' demise. Other stores are doing well and 90% of retail sales still take place in a brick & mortar store
Lampert had some cockamamie idea that Randian philosophy would be the way to manage his two companies, and he made the departments compete against each other for resources. He told managers that spending money on stores was a waste of time, so buildings became decrepit and unpleasant places to shop. Employees got no raises unless minimum wage went up, and saw their hours cut.
You can't cost cut your way to profit, but that has been Sears Holdings' only approach. Closing more stores will just accelerate the death spiral.
Now you have demoralized workers, terrible delivery experiences, and little stock. Dirty unkempt stores, a stupidly long checkout process with cashiers pressured to get you to sign up for credit or Shop Your Way. Wonder why the company is tanking...
3
Well, that was predictable. That is, hoping that Wall Street financial engineers with no experience in an industry could bring back a retail business. Kodak has been trying the same thing since 2013 with similar results. The end game here is that more pieces will be sold until nobody wants the final scraps. You can rest assured that the financial rescuers will get their money out somehow. But for the company itself, this is game over folks.
20
Reading the article, it appears that Lambert is on target to complete his vision of running down all the Sears assets and then buying them up for a fraction of their value a few years ago to companies he controls. How is this legal? One positive, it appears the Sears pension plans continue to honor their obligation to past employees.
27
I don't think we can blame the demise of Sears (and face it, this article describes its death-rattle) entirely on the shopping habits of America. I remember clearly going to Sears every time I needed an appliance or a set of tools at home; it was given that Sears would have what I neeeded.
Several years ago I visited "my" Sears to find that they were depressing and understocked. The website had turned into something more like eBay than Sears, with searches for items resulting in collections of ads for items sold by random no-name sellers. It was as if Mr. Lampert was trying their hardest to drive me away. Sad to say, he succeeded.
42
I started shopping at a Sears in Brooklyn - walking to the store walking to the store with my parents. Today, over 60 years later, there is a Sears within bicycling distance in Maryland, which I still use, perhaps out of some loyalty. The associates here work hard to provide the best service possible under the circumstances. I hope they all find good jobs as the stores close. Perhaps my local Sears will stay around for just a few months more if that long.
I agree with others that Mr. Lampert essentially ran the business into the ground. I'm glad I don't own Sears stock, but I expect my Kenmore appliances and Craftsman tools will last for many years.
9
Sears is a classic case of what happens when private equity runs amok.
This is no surprise to me. In 2011, I was a "secret shopper" for Sears, & it's retail system was a mess: prices wouldn't ring up right, discounts weren't applied correctly, & the Chicago executive management showed concern, but seemed rather helpless to enact helpful changes.
The bad thing is that if Sears goes under regarding its brick-&-mortar stores, there is no replacement for that void. And that's a real shame.
16
Great story.
The investment strategy is hard to assess.
Debt Even in bankruptcy, Mr. Lampert will have great sway over the company’s fate. His hedge fund owns about 40 percent of the company’s debt, including about $1.1 billion in loans secured by Sears and Kmart properties. As a result, he could force Sears to sell the stores or transfer them to him to repay that debt.
Ownership of debt is an oxymoron.
The Sears firm is close to closure as widely reported due to debt.
The valuation of the assets appear to be unaudited and may be much more or less of collateral value than reported.
The US Tax Code is quite clear re tax offsets for purchase of debt.
Activity to increase or decrease the value of the debt pertinent to shareholders, investors is covered in Australia by the Commonwealth Crimes Act 1913 as amended.
My advice is consult your lawyer or
3
Those of us old enough remember with great pleasure thumbing through the heavy Sears catalog filled with everything we might want but didn't necessarily need.There were even Sears kit homes which at the time was a modern marvel.Until recently we were happy to purchase the excellent Sears tools.They did not reposition themselves to compete in the age of the internet.Too bad, we will miss all the good shopping times we had at Sears.
8
Sears lost me as a customer when I had to buy a few repair parts for my orbital sander. At one time you could buy common parts at a Sears store. I couldn't order the parts at a Sears store, I had to go a Sears repair center that was very much out of the way. When the associate tried to charge me separate shipping and handling for each part, I said forget it and walked out. The S&H for each part was more than the cost of the parts! Both the store and repair center were in need of cleaning from top to bottom. The associates were more interested in talking amongst themselves instead of helping me. The condition of the store and the attitude of the associates reflected the attitude of upper management.
13
Sears stock dropped dramatically from 2007 to mere pennies today - corporate raiders like Mr. Lambert will do very well, everyday Sears employees not so much.
10
Sears’ failure is due to one’s man’s failure—ESL. He loaded Sears up with debt, engaged in self dealing to strip the company of its assets for himself and drove the company into the ground, literally. Sears used to be a place where you could find knowledgeable sales people who understood what they sold and help you find the right product. No more. A sad day for an American icon that died due to greedy, financial manipulators who had no idea of what they were doing.
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@John Smith
I think Mr. Lampert has always known exactly what he was doing. He is a "hedge fund investor", or to borrow a quote from Matt Tabbi writing about Goldman Sacks, "a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money."
2
Everyone blames online shopping, yet Target and Walmart are doing well. Maybe their CEO’s actually wanted them to grow. Sears had a buy online pick up same day in store option over 10 years ago. I used it frequently.
Sears isn’t in trouble because people stopped wearing clothes or buying lawnmowers.
71
"but failed to develop a winning strategy to entice consumers who increasingly shopped online"
Or rather, under Lampert, succeeded in NOT developing one.
Intent matters—and sludge fund managers intend to destroy.
88
How is a retailer going to survive by closing 1050 stores?
They are not in competition with Walmart, Home Depot or Lowes, as they have completely ceded the market to them. No one in Providence shops Sears - because there aren't any stores.
6
They were the Amazon of their day. You could order a house from sears, and the railroad would deliver a complete kit, with all pre-cut materials, to build the house on your lot. Many of these homes are still standing and occupied.
Sears was my go to place where I knew I could get something of quality for a fair price. I built my current home 15 years ago and stocked it with Sears Kenmore brand major appliances. They have been durable, and repairable. I also used to buy my tools and automotive needs at Sears. But I have not been there for 10 years at least.
As an early teen around 60 years ago, one of my favorite past times was reading the Sears catalog, which had around 2000 pages. Who can forget the Ted Williams endorsed JC Higgins sporting goods? The joke was that, in rural outhouses, Sears catalog pages were used as toilet paper. I didn't believe it. But then I visited the Calvin Coolidge home, furnished as it was when he lived there. In the privy was a Sears catalog. With the first 300 or so pages missing.
27
Sears needed an innovator and instead got a slow moving raider. Sears real estate holdings and name brands had value and instead of downsizing the stores, renegotiating the leases, and keeping the shelves stocked; Lambert ran Sears into the ground. I tried to support Sears and found empty shelves, empty departments and no employees in sight. Shoppers like a well lit stocked store not one that looks like it's been going out of business for the last ten years. Sears should have led online business especially with its catalogue business. Unfortunately the current owner and board weren't interested in changing the store for the future; just picking off the carcass. RIP SEARS.
73
@Cassandra
I remember Sears sadly for the last 10 years and it was a sorrowful place. The stores had not been modernized, and the displays looked like a bargain-basement mess, with merchandise strewn on those display counters. THe merchandise also seemed to be lower-quality or behind the times.
2
I worked for Lands'End (then part of Sears Holdings) from 2003-09. The worst-managed organization I saw in my 40-year career, Sears was a cross between the Bulgarian foreign trade department and the Lithuanian shipping commission.
26
Maybe folks didn’t give sears online a chance. I ordered 4 thermal underwear shirts for my dad from the sears website and they were delivered in 2 days- no hassle!
5
It is sad that Sears was not at the forefront of online sales. With its mail-order history, the company should have been a natural. At this point, part of the problem is likely that stogy image the store has. In an upscale, face paced world, I associate Sears with flannel shirts, lawnmowers, and aisles of appliances. They were never able to remake that sense that they were a solidly 1950s family store.
On another note, the loss of brick & mortar stores is, IMO, a loss not appreciated by many. While online shopping is convenient in many ways, it also has real downsides. Clothes cannot easily be tried on (and with many retailers trying something involves delivery fees, return delivery fees, and the hassle of packing for shipping back). For things like furnishings, colors may look very different online than they do in person, items are hard, if not impossible, to return (and expensive to do so). Then, too, there is the issue of how delivery happens and whether packages will disappear from a front stoop or an apartment building lobby.
18
@Anne-Marie Hislop
"On another note, the loss of brick & mortar stores is, IMO, a loss not appreciated by many."
And, let's face it, many people try on clothes or shoes / read books / listen to music / etc at brick and mortar stores, using the expertise of the staff - and order on line. The stores are a vital and usually unacknowledged part of the online business model.
The ex-American employees of Sears may.have their pensions but he stiffed the Canadian employees who are still fighting in the courts. Looks like USA pension legislation may be stronger than Canadian. They used to do a lot of home service installations: furnaces, windows, doors with good guarantees....all gone due to hedge fund greed. At least in Canada on line shopping is not that high a percentage. I realize I am a fossil but I still prefer a bricks and mortar store. It is funny but I used to do more catalogue shopping...mainly crafts...do not do any more.
13
It's really funny/sad that you're left explaining Sears as "an early version of Amazon".
Amazon can't possibly represent what Sears and Montgomery Ward meant to rural America. The total focus a working family had on one enormous catalog, particularly ahead of the holidays. It was the bigness of a big country's offerings, brought with a thunk on your doorstep. Color TV! Finally, a dishwasher! A Minibike, please please! All payable in installments, at a time when ordinary folk lacked access to consumer credit. That catalog was the promise of America for many.
136
@Duncan And just consider the added losses to the rural community with the demise of their catalog, bathroom reading material and ...
Long overdue.
I can't remember when I, or anybody one I know, has gone to a sears store.
Poorly run from top to bottom. Amazon was right to put them out their misery.
7
We don’t know if Sears would have survived without Mr. Lampert; there are enough examples of large retailers who have not. But it does seem to me that headed by Lampert, it was guaranteed to fail. His plan was always to strip the company of its greatest assets and sell them for his personal profit. The real estate could have been used or traded for Amazon like distribution centers. The good names of Craftsman and Kenmore could have been put to good use to revamp the company. There was never more than lip service paid to the idea of reinvestment to evolve the company into the next Amazon or Walmart.
We can’t criticize Lampert for not succeeding; there is much to criticize for not really trying. I never thought that I would outlive the lifetime warranty of my Craftsman tools.
81
@Kayemte
We went to the mall last week (a rarity), including the Target. It was full of customers. There was, at one time, a Sears at the other end of the mall. I don't even know if it's still there.
Why has Target succeed as a brick-and-mortar department store when Sears, and so many others, have failed?
5
@Kayemtee. Yes, it does seem that the long term strategy was to extract profit from Sears - but that is exactly the purpose of the system, no? Keeping a business alive indefinitely is not a strong priority in our system. Companies are not permanent, they exist only to make money for their owners. We can and should reflect on the role Sears had and appreciate its success. But its demise seems to be nothing more than the usual lifecycle of a large successful company.
1
Severance, health benefits, insurance and pensions are the unicorns of the American workers while vultures like Lampert thrive.
56
Another plundering of AMERICA by the hedge fund set. They destroyed Toys R Us and now Sears.
109
@David DeFilippo
Im sure the administration of Toys R US made out like bandits, as the company was on its deathnell!
And don't forget GE, DeFilippo.
The Robber Barons want to destroy everything "old" that was built over time because the assets they can plunder are unbelievable.
Thanks, Reagan.
1
@njglea
It's not as bad as last century when this was going on every day tearing apart Nabisco, RJ Reynolds and others . Those pieces of the old companies were never as successful after the butchery of the hedge funds and investment banks.
I turn 82 tomorrow and Sears has been with me for the whole journey. I will miss them.
What will Lampert do? Is he innovative enough to seek solutions , or is it simply too late.
13
Exceptionally written with vital background information.
I am beside myself in disgust as Wall Street has made a sport of pillaging our nation and shipping our vital economic engines outside the nation.
I fault the higher learning institutions that profess greed over citizenship and social responsibility.
It is no surprise to me that such highly positioned people have come from Goldman Sacks America. They do!
I somehow no longer feel any sympathy for their origin, lower Manhattan, and remember well how the corrupt NYPD protected those with the money during the "Occupy Wall Street" demonstrations.
Don't ever call me cynical. I'm a realist.
Lambert seems to have been intent on pillaging Sears and Kmart more so than to try to save and rebuild a business. I believe he might be called a "Corporate Raider". I call him a slithering leech.
When I was young fifty years ago, we called the Sears Christmas Catalog, the "Wish Book". Now I wish Lambert were sent to jail for doing such widespread extensive harm to our society.
154
@Shakinspear What happened to Sears was a leveraged buy-out, where someone with little money (Lampert and KMart) bought out Sears by foisting its debt elsewhere. The prototype was co-op conversion of rental apartment buildings, something I experienced when I lived in Manhattan some 30 years ago. Without an MBA, I figured out that the "engine" that drove this greedy enterprise was to put semi-permanent debt on the building by a "balloon" mortgage which never paid off the principal, all the while having the co-op "sponsor" retain control of the retail spaces which could otherwise provide income for the residential portion of the building.
Lampert belongs in the same jail cell with the Trump crime family.
5
@Shakinspear You are letting nostalgia influence some clarity here...Sears was a failing company when Lambert took control. I see him less as a slithering leech and more of a seagull hitching a ride on the back of a bloated whale carcass on its way out to sea. If Sears had been a well run company, it would not have been susceptible to this kind of behavior. That is not the part of the system that is rigged, that is capitalism working. The part that is rigged is the legal structure that would allow Lambert to "leech" value out of the entity he runs and file for protection. That part is a catastrophe.
Losing Sears will be a loss to Americana, but times have changed. One question I didn't see answered: What happens to Lands' End? It's a separate company, yes, but most (all?) of its "storefronts" are housed in Sears stores. As Sears stores close, Lands' End will be forced to become solely mail-order again or open its own storefronts, which raises the specter of huge real estate costs at a time when stores are suffering in part because of those costs. The future plans for Lands' End would be a good and timely follow-up story.
11
About 10 years ago, I gave Sears one last chance: I needed to purchase a new washer and dryer combo for our tenants, and I needed the best price and quick delivery. The store I went to was in a large shopping mall.
The employee there couldn't tell me (a) an accurate final sales price; (b) if the item I wanted was in stock; (c) if I could schedule delivery so it was convenient for my renter, who worked nights; and (d) tellingly - what Best Buy down the street less than 1/2 mile away was charging for the same item.
When I explained my frustration and complained that Sears was headed for bankruptcy if they proceeded on this course, the employee told me in a nasty voice, "Well, I sure hope that happens soon, as then I could finally take my pension and retire." I turned around and walked away from a $1000 sale. The employee didn't follow me or attempt to assuage my complaints. Best Buy got my money, my renter got his new W+D at a convenient time, and I resolved never to walk into a Sears store again. Ever.
At least Lampert knew where to find some value in Sears, and it sure wasn't in its human capital, but in its real estate holdings and a few of its reliable brands like Craftsman. And why invest in IT when your workforce doesn't understand what the internet is useful for beyond looking at pictures of your grandkids on FB during work time ... instead of looking at what your competition is doing down the street?
How does that go? "... not with a bang, but with a whimper?"
19
@JCTeller
I bought a washing machine 2 years ago and had an excellent sales person. The only problem was Sears didn't have a dryer in stock for 6 weeks. I didn't want to schlep wet clothes to the laundromat for 6 weeks so I bought it elsewhere.
3
With Sears’ vaunted mail-order history, I’ve often wondered why it didn’t charge to the fore of online shopping instead of trying to limp along its bricks and mortar stores.
Too bad.
4
@Kosher Dill. There is a general theory of this in business - Kodak was another example. A well established large business has established capital, much of which is paid off, an existing customer base. Making a huge transition means switching to new capital (e.g. warehouses vs. stores) and very likely doing things that the existing customer base doesn’t value. And it is extremely risky, in business terms.
As a simplistic example, if a complete transition to a new business model has a 15% chance of success, with no guaranteed profits among the way, but keeping the old model has a 10% chance of success with predictable profits in the short term, investors may decide the switch is too risky, even if they accept there is a low chance of success in not switching.
Sears and KMart also made some of their own problems by overexpanding in the 1990s, leaving themselves vulnerable to the takeover that happened.
It is unfair for commenters to portray Eddie Lampert as a Wall Street opportunist. He took over Sears and Kmart when they were already failing. Back then, the only threat was Walmart's new stores and low prices. He spent 12+ years trying to turn around Sears and Kmart only to be slowly crushed by online sales (like almost every other retailer.) When he bought Sears and Kmart, he paid full price for the properties and brands which were later sold to keep the company afloat. Sure, some opportunists buy companies then quickly sell off assets and go bankrupt but Eddie did not do this. I believe he wanted to be associated with saving an iconic American brand, but could not overcome the market forces destroying all retail today.
11
@Brendan Okay, says you Brendan. Whatever his motivations may or may not have been at one time, his actions tell the real story. Stripping away at the assets and selling off everything valuable while making money on both sides of the table is pretty funny way or trying to saving an "iconic American brand". The real question is why you and Eddie Lampert and Steve Mnuchin think everyone else can't see what they do but only hear what they say.
51
@JW There's no question that some hedge funds sell off assets and bankrupt companies, but this is not what happened here. Lampert's strategy clearly shows he was trying to revitalize the company and return Sears to being the market leader.
An opportunist hedge fund wouldn't have waited until 2017 to sell off Craftsman.
You're forgetting Montgomery Ward. Retail operations find it difficult to keep up with changing times. Just compare today's Fifth Avenue with what it was in the first twenty years after WWII. Nobody seems to have figured out a route to take control of a longstanding retail giant and transform it. Perhaps starting from scratch is simply easier; no cobwebs!
8
Typical short-sighted Republican thinking is what has doomed these retail dinosaurs. The department store model began in France with the Bon Marche store in Paris and was copied by Wanamaker and others in the United States around the time of our Civil War. It's painfully evident that this retail era is over. Yet store chains like Meijer give Walmart a run for its money, playing the same game. Only Meijer has always been a union shop with prices ever so slightly higher in consequence of taking care of its workers...
18
It isn't just Sears that's suffering in this age of declining sales at traditional brick and mortar stores. Even expensive retail establishments catering to the upper crust plan to close their doors for good next year. On Manhattan's Fifth Avenue Bendel's and Lord & Taylor's iconic flag ship store are shutting down next year.
The golden age of the dominant retail giants is gone for good.
18
This seems to be the story for companies that are taken over by a hedge fund which buys them to strip them of their assets and use them as leverage to borrow money. A&P comes to mind as another example. This is a great lesson companies just don't learn, no matter how big you are you must change with the times. Sears was the first Amazon while K-Mart was the first Walmart and just look at them now.
17
You would have to be greedy not to re invest in a brand known by virtually every American.
For years Amazon posted virtually no profits while it reinvested its cash flow. We all know how that is going.
Mr. Lambert's Sears was a pretend innovator deprived of the cash and
vision needed to bring it into the 21st
century. Instead it was choked to death
by removing decades of brand equity with spinoffs, asset sales, real estate refinancing, dividend payouts, and more.
All engineered by Mr Lambert with him making money on every deal and on both sides of the table. Gross.
198
This is perhaps better seen as a story about how Mr. Lampert ran the operation only for his own benefit -- stripping out the valuable parts for his own, separate companies and leaving the carcass to die with its debts never to be paid. While his actions
were probably legal, there was no accountability or responsibility to other shareholders, employees, or anyone else. Moaning about e-commerce and Amazon is beside the point -- Lambert destroyed the company.
284
@seattle expat: Did you honestly think that any of Sears's massive base of retired folks were going to say, "Sure, cut my generous pension benefits to insure that the company can survive"?
Lambert didn't destroy the company; it was in decline ever since it failed to join the Internet Age. And it's hard to rebuild an IT platform to satisfy your customers when your competition is intensely chasing their dollar, but your salespeople on the floor - generally older, but not more experienced than the 20-y/o at Best Buy down the street - have the sales skills of a kumquat.
1
@JCTeller No doubt there were many factors influencing the decline. Lambert could have chosen to get an IT company involved in internet sales, as many other companies have. Similar to the Tories efforts to get NHS to fail, and Republicans to get the affordable care act to fail, Lambert effectively used the screen of Sears' fixable problems to cause to decline faster and fail, getting a free ride on the debt through bankruptcy. This is the moral equivalent of theft.
2
@seattle expat
Probably aided by a board of directors looking the other way.
1
This column hints at Lampert was a failure until the last 2 paragraphs; but in fact, this is a standard operating procedure of vulture investors of stripping a company to the core.
After the telecom bubble bursted, Carl Icahn took control of 360 Communications. It did not go Ch 11 but it didn't stop Icahn to benefit himself at the expense of minority investors and regular common shareholders.
Perhaps such naked display is more problematic these days after countless scandals. So engineering a failure may require a more elaborate ruse like this one
50
What niche can Sears still serve? Between Walmart and Amazon, they've been sidelined. To neither did they respond effectively. Hence, I see them closing forever after the post-holiday sales. We shouldn't lament this, unless we're prepared to shop in the remaining stores.
6
On line shopping is growing every day. Sears didn't make the change over. Good bye Sears. Hello Amazon.
@Ted Bishop
A ten minute drive to the store is still much faster than two day shipping.
10
Unfortunately Sears developed a reputation for being stuffy and dated. Sears tried introducing a Kardashian inspired clothing line to woo younger shoppers which failed miserably. Kings Plaza in Brooklyn dumped Sears a couple of years ago to make way for stores that would attract a hip, fashionable crowd.
However no store was more American themed than Sears. Just check out its long time slogan: Sears--Where America Shops
17
@sharon5101: More accurately, Sears - Where America Shopped. Thank goodness someone finally had the heart to put this aging old dog down and out of its misery.
1
It is amazing to think that the company so deeply associated with the mail order business could not transition to the internet era. When I was a kid, getting the Sears Christmas catalog was practically a gift in itself. Very sad to see the company’s decline.
114
The Sears catalog used to be the lifeline between rural America and the rest of the country. In the days before indoor plumbing it also served as toilet paper for the outhouses of America. So it is with the deepest sense of nostalgia and personal loss that we mark its passing. America will never be the same.
24
@Ed
Perfect analogy! Lambert did the same thing with Sears that our plumbing-challenged ancestors did.
2