INSIGHTS AND PERSPECTIVES

Editor’s note: Sears’ troubles mark end of an era

BY Seth Mendelson

Sears, once the nation’s largest retailer, filed for bankruptcy in mid-October.

It was a long time coming. Sears has been the retail version of a dead man walking for the better part of a generation, and even its much-questioned purchase of the equally struggling Kmart chain more than a decade ago did little to change the perception that this was a big chain in big trouble.

The gurus who run this chain said they will keep it going with a loan or two from some high-risk investors, though they plan to close about 142 stores later this year. This is just corporate-speak that really means they have no clue what to do with the remaining stores, and they will probably close these 500 or so units in the near future too.

So, for all intents and purposes, Sears is dead, and it died because its corporate leadership — over the last 20-to-25 years and maybe longer — failed to realize that consumer-shopping behavior was quickly changing and they needed to change with it or fail. Even the decision to close the famous Sears catalog in 1993 now seems like a mistake, given the fact that a digital version of it could probably have been successful nowadays.

Instead of reading the consumer tea leaves, Sears did its best to dismantle its retail assets, selling off many of its most popular brands and doing little to keep up with changing fashion trends that could have kept the company at the forefront of the industry. Meanwhile, the company seemed to pay a great deal of attention to its real estate portfolio, which may have made its top executives rich, but did nothing for its retail operation.

Can other retailers benefit from Sears’ decline? Unlike the Toys “R” Us liquidation a few months ago, there is not much to go after if Sears completely closes down. Consumers got the message years ago that this was not a chain that carried the most sought-after merchandise, and they stayed away in growing numbers. Suppliers did not want to help either, fearful that when a bankruptcy filing did take place, they would be left holding the bag.

In the end, Sears will join the growing list of retailers that failed. The problem here might be that no one really cared anymore.

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