Slashdot Mirror
Sears, the 125-Year-Old Iconic Retailer, Has 24 Hours To Survive (cnbc.com)
An anonymous reader shares a report: Sears, the employer of more than 68,000 filed for bankruptcy in October. Its last shot at survival is a $4.6 billion proposal put forward by its chairman, Eddie Lampert, to buy the company out of bankruptcy through his hedge fund, ESL Investments. ESL is the only party offering to buy Sears as a whole, people familiar with the situation tell CNBC. Without that bid or another like it, liquidators will break the company up into pieces. But as Lampert stares down a deadline of Dec. 28 to submit his offer, he is quickly running out of time. As of Thursday afternoon, Lampert had neither submitted his bid, nor rounded up financing, the people familiar said. Should Lampert submit a bid, Sears' advisors would have until Jan. 4 to decide whether he is a "qualified bidder." Only then, could ESL take part in an auction against liquidation bids on Jan. 14. It is possible Lampert, Sears' largest investor, secures financing in time to meet the deadline, these people said.
They should have won the online race with their catalog history.
They did. They sold them all off and left behind the rotting corpse of brick and mortar to die.
Sears liquidated long ago. The financial term is cash cowing. Selling off everything of value and abandoning the rest.
Like most people I know who stopped shopping at Sears, it was because of quality. Craftsman was one of the actually premium quality brands they used to carry. But when they dumped their high quality supplier and started rebranding cheap import tools as "Craftsman", they were no longer significantly different from cheap imports sold anywhere else. The "lifetime" warranty would clearly die with the store, so that lost any value and the brand was burnt for a few quarters of boosted profits in true modern American MBA success story SNAFU. I've spent thousands on Craftsman tools in the past, and once upon a time that meant I spent tens of thousands at Sears on decent quality appliances, clothes, tires, etc. But with a collapse of quality, why bother going there? Most "premium" brands worldwide are now repeating this pattern to cash out their brand equity.
they got bought out by a Bain Capital style "Vulture" capitalist, Eddie Lampert. He started off his tenure by mismanaging them in a crazy, Ayn Rand themed style where each department was pitted against the other, resulting in massive infighting. Meanwhile he was busy extracting anything of value from the company for his own personal gain. At the moment he's been loaning them money to set himself up as the primary creditor so he gets paid when they liquidate. That's how he's legally extracting the assets without running afoul of laws designed to protect shareholders in a publicly traded company.
The real problem is that in America you no longer make money by running successful companies. You make money by firing up a startup and waiting for a buyout or by buying up an existing, longstanding company and gutting it like a fish. That's the reason guys like Lampert go to school for business, they're learning how to legally do things that should be illegal.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
Wrong. The downfall of Sears is a consequence of competition from Walmart/Target - which happened before Amazon was even on the scene.
They did not get killed by the internet. They got killed by Eddie Lampert.
It's actually a combination of competition from many faces. Clothing is a major item for Sears, and yes Walmart and Target (and Kohls) are competion for thier price point. But another big item for Sears is appliances (at least in my mind, that is what they are best known for, but I'm not sure if that's the biggest part of their bottom line). In that area they've faced competition from Best Buy, Home Depot/Menards/Lowes, Costco, and others.
Along with clothing and appliances, tools is the one other thing that comes to mind when I think Sears. And again, Home Depot/Menards/Lowes is big competition here, but I really feel like (and I may be way off) Harbor Freight is a huge source of competition for them here. Yes there is a bit of a quality difference (though that is a bit diminished as I don't think craftsman quality is quite what it used to be), but honestly for most people the cheap Harbor Freight tool is sufficient 9 out of 10 times, and for the price of the craftsman tool you can just replace the harbor freight tool 5 times (and that's not even considering most of the HF non-power tools have a lifetime replacement warranty anyway)
Of all the things out there, I really feel like Amazon is one of the smallest contributors to Sears' demise.
Actually, the major factor against Sears succeeding was Eddie Lampert himself. He had zero knowledge or experience in retail stores, being a career hedge fund manager. He's a devoted Libertarian and forced each department of the company to act like it's own separate company, fighting for funding. If Kenmore (Sears branded) appliances were on sale, they had to pay their ad department more than what other brand appliance mfgs. were paying or they wouldn't get mentioned in the stores own sales fliers. The constant bickering and loan servicing simply ate into all their revenue until the company imploded like KMart (also owned by Lampert) did before them.