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Oct
23
Who Killed Sears?

So many people are saying so much about the announcement that Sears has filed Chapter 11 bankruptcy. Many are saying that Amazon killed them, yet other Department Stores continue to do well. Some say that the purchase by Kmart is responsible for their demise while others say that Walmart took Sears business.

Following are some facts to consider. Sears Roebuck and Company began in 1892 as a mail order catalog company. They started opening retail stores in 1925 and in 2005 they were purchased by Kmart. For the past several years they have been closing both Sears and Kmart stores. Walmart began in 1962 and Amazon started as an online bookstore in 1994.

I used to be a Sears customer and have bought Craftsman tools, tires, car batteries and appliances from them. My Grandfather had Craftsman tools, some of which I still have and they were guaranteed for a lifetime. Sears sold Craftsman to Black and Decker Inc. and they no longer have the lifetime guarantee. Although Kenmore appliances are manufactured by Whirlpool and have been for more than 100 years, the level of service at Sears has declined over the years and I really have not thought much about them over the past ten years.

In reality, they have been in a tailspin for many years now. They used to own Allstate Insurance, Discover Card, Lands End, NTB and several other businesses. Over the past decade at Sears, more than $26 billion of market value has disappeared. Revenue has been halved, as has its work force, with 175,000 people losing their jobs. The stores have not been maintained, the staff has very low morale and salaries and commissions have been substantially reduced. There really has been no attempt to create a corporate culture that wants to provide “Guest Astonishment,” or even a moderate level of customer service.

When you go to Costco, a warehouse store, the Associates are happy to be there, the prices are very low and everyone is treated as an Invited Guest. It really is a pleasure to shop there. So, who or what killed Sears? I believe that people want to be treated as Guests, which includes the Internal Guests, or staff. The atmosphere needs to be pleasant and the Corporate Culture needs to support that, not just by words, but by action. The current CEO of Sears, operates from his home in Florida and only goes to the corporate headquarters in Illinois once a year for the annual corporate meeting. Great leaders listen to their people and lead by example. Consumers vote with their money and spend it where they feel appreciated. So you decide, what caused the demise of what was once an incredible company?