Empty shelves, poor cus­tomer ser­vice speed Sears’ de­cline

Kuwait Times - - Business -

NEW YORK: Sandy Het­rick drove 15 miles from her home to a Sears in Me­dia, Penn­syl­va­nia on Wed­nes­day to buy fold­ing chairs and clothes.

Her lo­cal Sears in Wilm­ing­ton, Delaware, the 54year-old re­tiree said, was so poorly stocked that she stopped go­ing there, even though there is no Delaware state sales tax. “It’s re­ally go­ing down,” Het­rick said about Sears, which is weigh­ing whether to file for bank­ruptcy pro­tec­tion in the com­ing days.

“You can’t find any help. The stores have min­i­mal items,” she said as she shopped at the store in Me­dia. A change in sen­ti­ment among pre­vi­ously loyal shop­pers like Het­rick has con­trib­uted to the re­tailer’s sharp de­cline in sales. Sears losses have con­tin­ued to mount to over $11 bil­lion from its last an­nual profit in 2011.

On Fri­day, Reuters was first to re­port that Sears is plan­ning to close 150 stores and keep at least an­other 300 open as part of a plan to re­struc­ture un­der U.S. bank­ruptcy pro­tec­tion. On Thurs­day, Reuters re­ported Chief Ex­ec­u­tive Ed­die Lam­pert is ex­plor­ing a bid for some of the re­tailer’s busi­nesses and real es­tate.

Sears did not re­spond to mul­ti­ple re­quests for com­ment. In Septem­ber, the re­tailer said it is cut­ting down on lower-per­form­ing prod­ucts and be­com­ing more ag­gres­sive in clear­ing out sea­sonal mer­chan­dise. It also ex­panded the as­sort­ment on its on­line mar­ket­place, which al­lowed it to add more pop­u­lar brands. Sears also said it con­tin­ues to take steps to im­prove its in-store ex­pe­ri­ence for shop­pers, without of­fer­ing de­tails.

It has made at­tempts to sell its prod­ucts like tires and Ken­more ap­pli­ances on Ama­zon.com Inc’s web­site to off­set the de­cline in tra­di­tional shop­pers.

Even so, its an­nual sales have dropped nearly 60 per­cent to $16.7 bil­lion.

The re­tailer’s prob­lems, ac­cord­ing to shop­pers, for­mer em­ploy­ees and ven­dors in­ter­viewed by Reuters, range from its lim­ited as­sort­ment of mer­chan­dise to poor cus­tomer ser­vice. In ad­di­tion, some said, the re­tailer aban­doned ba­sic shop-keep­ing stan­dards such as clean stores. And Lam­pert’s lead­er­ship over the years has hurt it more than helped.

The re­tailer, which for decades was the Ama­zon.com of its time, branched into in­dus­tries as di­verse as in­sur­ance, real es­tate and even broad­cast­ing. A sign of its cor­po­rate power was the 110-story build­ing called the Sears Tower, once its cor­po­rate head­quar­ters in Chicago and the world’s tallest build­ing for a pe­riod of time.

Het­rick shopped at Sears since she was a child, and said she re­calls look­ing for­ward to its Christ­mas cat­a­logs. But nos­tal­gia for the Sears hall­marks, from the cat­a­log to Crafts­man tools, has not helped the 125year-old depart­ment store bring cus­tomers through its doors in re­cent years.

The re­tailer lost its al­lure with shop­pers af­ter shrink­ing its to­tal store lo­ca­tions by over 70 per­cent in less than a decade. Sears runs nearly 900 stores, in­clud­ing the Kmart chain. As of Fe­bru­ary 2018, the re­tailer said it em­ployed about 89,000 work­ers in the United States, com­pared with 246,000 peo­ple five years ear­lier.

Over that time, the num­ber of con­sumers open to shop­ping at Sears dropped to 14 per­cent on June 1, 2018 from 28 per­cent on June 1, 2013, ac­cord­ing to data from YouGov BrandIn­dex, a com­pany that tracks pub­lic per­cep­tion of brands.

Only 9 per­cent of US mil­len­ni­als - aged 22 to 37 years - said in 2018 they would con­sider buy­ing goods from the re­tailer, it said. Kmart ef­fect

Some for­mer em­ploy­ees said the re­tailer started go­ing down­hill in 2005 when it merged with Kmart, a deal en­gi­neered by Lam­pert. In 2004, when the re­tailer an­nounced the merger, it was the third-largest in rev­enue be­hind Wal­mart Inc and Tar­get Corp.

Cus­tomers used to be able to check out in any depart­ment in the store, and there was al­ways some­one to ask for as­sis­tance, said Judy Davis, 81, of Ban­ning, Cal­i­for­nia, who re­tired from Sears in 1999 af­ter work­ing at the Cer­ri­tos, Cal­i­for­nia, store for 27 years. Af­ter the Kmart merger, the check­outs were placed in one corner near the store exit, and cashiers could not leave their reg­is­ters, she said.

“They re­ally used to pro­mote cus­tomer ser­vice. That went out the win­dow,” Davis said.

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