By Alan Wolf, YSN
Sears has announced plans to close another 96 Sears and Kmart stores, with going-out-of-business sales to begin Dec. 2.
This latest round of closures, which follows the shutting of 26 locations in October, will leave the once mighty Sears and Kmart chains with a combined total of 182 locations, in addition to the more than 400 Sears Hometown and Outlet stores it recently reacquired after spinning them off in 2012.
In a statement, parent company Transformco cited “a difficult retail environment and other challenges” that have forced it to “streamline our operations.” But it did receive an 11th-hour cash infusion of $250 million from affiliates of owner Edward Lampert and an unnamed third-party investor, which will help keep the lights on through the holiday selling season.
Sears and Kmart together operated nearly 3,500 stores when Kmart owner and hedge fund operator Lampert acquired Sears in 2005. The company filed for Chapter 11 protection in 2018 following eight years of losses, and Lampert bought the business out of bankruptcy last February for $5.2 billion under the Transformco entity, keeping 425 stores.
But besides a lighter debt load, the chains still face the same existential challenges that ultimately led to the bankruptcy, including deteriorating stores, poor sales and traffic, a dwindling assortment, and continued competition from Amazon, the warehouse clubs, the home improvement chains, discounters like Walmart and Target, and a robust independent dealer channel.
Ironically, Sears was America’s first Amazon, supplying a mostly rural nation with essential goods through a catalog created in 1893 by Richard Warren Sears and Alvah Curtis Roebuck. By the 1940s the direct seller began opening stores at a rapid clip to provide post-war suburban communities with TVs, appliances and lawn mowers. But it failed to stay relevant beyond the baby boom generation and commenced a slow swan dive in the 1990s that was compounded by e-commerce competition, declining mall traffic and the sell-off of key assets.
“We will continue to evaluate our Sears and Kmart footprint, consistent with our overall retail and service strategy,” the company said.