Sears closing store just months after its remodel
What went wrong at Oakbrook Center?
Sears’ return to Oakbrook Center last fall was a rare spark of good news for a company teetering on the edge of bankruptcy.
Though the store was significantly smaller than the threestory space it had occupied since the mall opened in the early 1960s, customers at the grand reopening in October praised the brighter, more modern look. Some said they had questioned whether it would reopen at all as the store’s remodeling stretched on for more than a year.
When the end came, it came fast: A liquidation sale began Monday and the store is scheduled to close Sunday.
Even with the fresh look and smaller size, the store wasn’t profitable, according to Sears. When Sears’ former CEO Edward Lampert formed a new company to buy the retailer’s assets in a bankruptcy auction earlier this year, it decided not to acquire the Oakbrook Center store’s lease.
On Wednesday caution tape cordoned off swaths of the store filled with appliances that had already been sold. Some shelves that usually held tools and lawn equipment were bare. Apparel and shoes were relatively plentiful, but shoppers clearly had been rummaging through the usually orderly racks.
Sears never said it planned to bring the changes at Oakbrook Center to other stores. But its decision to pull the plug on a newly renovated store in a popular mall suggests that even with healthier finances after bankruptcy, figuring out how to bring customers back won’t be easy.
What went wrong?
Sears hasn’t cracked the code on smaller stores.
The Oakbrook Center store reopened with an “odd hodgepodge” of items — appliances, hardware, exercise equipment and women’s apparel, said Neil
Stern, senior partner at Chicago-based consulting firm McMillanDoolittle.
It also dropped some products that brought customers in, like Lands’ End apparel. The brand once had a shop inside Sears but recently opened its own store nearby.
The “right” store size varies by retailer, but chains seem to be gravitating to stores between 25,000 and 45,000 square feet, said Sean Sharko, senior vice president of investments at real estate investment firm Marcus & Millichap. The Oakbrook Center store, even after it downsized, had 62,000 square feet.
The fact that Oakbrook Center closed so soon after reopening suggests it was “not even close to working,” Stern said.
Earlier this month, Sears announced plans for three new stores that will be much smaller — between 10,000 and 15,000 square feet — with a narrower focus on appliances, mattresses and smart home products. The stores, called Sears Home + Life, are expected to open next month in Alaska, Louisiana and Kansas.
It wasn’t a good fit for the mall.
Sears didn’t seem like a brand that would be popular with shoppers coming to Oakbrook Center, who are looking for something “a little more upscale,” said Mary Kaihara, 64, of Westchester, while looking for closing sale deals Wednesday.
Oakbrook Center has staple mall chains like Gap, Claire’s and Forever 21. It’s also home to brands like Brooks Brothers, Burberry, Louis Vuitton, Vineyard Vines, Peloton and Tesla.
Sears may be an iconic American retailer, but it had been struggling for years and “lost a lot of its luster,” said Austin Weisenbeck, senior vice president of investments at Marcus & Millichap. “It doesn’t fit the image most people associate with Oakbrook Center.”
Its location didn’t help.
After Sears remodeled, it was more isolated. Its only entrance was below the main level and customers could no longer access other stores at the mall by walking through Sears.
A Life Time Fitness is under construction near Sears, along with a movie theater and restaurant, which should bring more foot traffic to that side of the mall, Sharko said. But according to Life Time’s website, the facility isn’t expected to open until next year.
The store faced the same challenges.
Even with a renovation, the store wasn’t immune to the broader challenges facing Sears’ brand.
“You could see things slowing down. It only got a lot of traffic during the holidays,” said Patti Camp, 65. Her father-in-law used to work in product safety at Sears, and she regularly shopped at the Oakbrook Center store before a move to Naperville made it less convenient. She came to check out the sales Wednesday and carried a stack of heavily discounted shirts.
Other shoppers said the products they liked buying at Sears weren’t things that brought them in frequently.
“I love their appliances,” said Kaihara, who bought her Kenmore washing machine and dryer at Sears. But that was 15 years ago and she said she wouldn’t miss the Oakbrook Center store when it closed.
There’s also the question of winning back customers’ confidence. The Oakbrook Center store opened less than two weeks before Sears filed for Chapter 11 bankruptcy reorganization.
“You want to shop at a place that’s going to stick around,” Weisenbeck said.