February 14, 2019
Edward Lampert, the hedge-fund manager who chairs Sears, indicated he has a new plan for the beleaguered retailer once it climbs out of bankruptcy. Specifically, Lampert wants to open smaller stores offering less apparel. Rather, the space in the stores, which will average approximately 60,000 square feet, will have more retail space for tools and appliances.
Lampert also indicated he will sell or sublease some of the 425 remaining stores under the restructured company, which currently lacks a corporate name. The company will be composed of 223 Sears stores, 202 Kmart locations, and the Kenmore and DieHard brands. Sears sold its Craftsman brand to Stanley Black & Decker in 2017, while retaining a license to continue selling products under the name.
While cutting back on apparel and focusing on the so-called “hard lines” is an interesting strategy, Burt Flickinger with consulting firm Strategic Resource Group is somewhat skeptical. For one thing, the smaller stores will be competing against the larger Home Depot Inc., Lowe’s Co., Best Buy Co. and Amazon Inc. Additionally, “(Sears) lost the confidence of the vendor community,” Flickinger told the Wall Street Journal. “Sears and Kmart prices are no longer competitive.”
But Lampert said he hopes to win back suppliers with a company that is in better financial help. “We have a clean balance sheet,” he told the Wall Street Journal. “We hope suppliers take a more constructive approach.”
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