New York
CNN
—
Tracy Easterling spent about an hour on Sunday shopping at Sears, once one of her favorite stores. She ended up showing nothing but recollections.
Easterling was working at Sears in her hometown of Jersey City, New Jersey, one of only 15 full-line Sears department stores. Sears was once the largest and most important retailer in the world.
“It’s the first time I’ve been here in a while,” she said, browsing the shoe selection, which is still in boxes rather than on display.
“I was just looking for a sale. But it was empty and there wasn’t much to choose from,” she said. “It used to be that you could buy almost everything you needed in one store.”
Easterling said when she told friends she was going to Sears, their reaction was: “Are there any Sears open?”
“Look at it. It’s as empty as possible,” she said, looking down the aisle without seeing any other customers, despite the fact that shoppers were out in droves on the weekend after Thanksgiving.
Most of the customers who shop at the Jersey City store on Sunday are older and, like Easterling, can remember Sears in its heyday.
Many left quickly without finding what they were looking for. Some younger shoppers said they stopped only because they remembered coming here as children.
Razeyah Surrell, 23, was shopping with friend Taryn Reczkowski, 22, looking for a pair of pants and said, “I used to shop here with my great-grandmother years ago.” Looking.
“I walked in and said, ‘Wow, this is so sad,'” Reczkowski said.
It was a slow and quiet death for an iconic chain whose pioneering catalog and anchor in many malls across the country once made Sears the Amazon (AMZN) and Walmart of its day.
When Sears and Kmart merged in 2005, they had 3,500 stores and more than 300,000 employees in the US. But both brands have been caught in a vicious cycle. Post-merger, the company has focused on selling its more attractive real estate and buying back stock to shore up its falling stock price, rather than investing in modernizing stores to make them more competitive.
By 2018, the company had filed for bankruptcy. Eddie Lampert, the hedge fund operator who masterminded the disastrous Kmart merger and was CEO of the holding company, bought what was left of the company out of bankruptcy in early 2019. He had promised a turnaround after the company got rid of most of its debt, unprofitable stores and less attractive leases.
The company, which emerged from bankruptcy in early 2019 — with the overly optimistic name Transformco — has 223 Sears stores and 202 Kmart stores nationwide. But less than four years later, it’s barely sustaining life, as evidenced by its tiny physical footprint and lack of shoppers.
Now experts say there is little reason to keep even the few stores that are still open.
“Sears has been out of business for a long time. It has no chance of coming back,” said Neil Saunders, managing director of GlobalData Retail. “No one but Eddie Lampert knows why he’s keeping these remaining stores open. You can’t keep that many stores working economically.”
As for why Sears hasn’t gone out of business yet, Saunders said, “It’s probably in some contract or agreement that if he closes all the stores, there’s a fine. Or maybe they’re open because Eddie Lambert Eddie Lampert has a very weird view of business. He still seems to have this illusion that he can get it back. A lot of it probably has to do with ego.”
While the company’s demise now seems inevitable, it didn’t need to be, insists Mark Cohen, director of retail studies at Columbia University and former chief executive of Sears Canada before the Kmart merger.
Sears’ experience with its catalog, which includes an all-encompassing product list, gives it an edge over other traditional retailers for an early move into online sales, he said. He also said Sears has better lease deals than competing department store chains.
“It could have been Amazon’s competitor. It was Amazon at the time,” Cohen said. “There is no doubt that Sears needs to close stores and consolidate assets, but their real estate holdings are not going to be a burden to other department store chains. There is nothing stopping it from being reborn as a world hitter. At the end of the day, it is all about the incompetence of its leadership and malfeasance.”
If — or possibly when — Sears does close its last store, it will join a long list of retailers, including RadioShack, Payless Shoes, Gymboree and American Apparel, which have just emerged from bankruptcy , and soon closed down.
Accurately counting the number of unoperated stores remaining for the company is difficult. The total of the remaining 15 Sears stores is about one-third down from 23 at the same time last year. But those numbers come from those listed in the store locator on the company’s website. Spokespeople for the hedge funds Sears, Transformco and Lampert did not respond to questions about the number of remaining stores, the company’s profitability or future plans.
Even if the eventual full-line stores close, the Sears name will likely live on.
Emerging from bankruptcy, Transformco acquired the previously spun-off holding company, which included the franchise chain operating under the name Sears Hometown. The stores are a fraction of the size of the full line of Sears, and focus on appliances, tools and outdoor equipment.
Before Transformco reacquired Sears Hometown in 2019, there were about 700 of these stores, but they too have been steadily closing. Of the roughly 100 stores that closed earlier this year, just over 100 remain open today.
Kmart has shrunk to a smaller size.
A year ago, there were only six Kmart stores in the continental US, with six more in Puerto Rico, Guam and the US Virgin Islands. Former Kmart employee Dick Barta had closely tracked the closures, and since then the store in Puerto Rico has closed, leaving just three on the mainland and one each in Florida, New Jersey and Long Island, New York. these years. The Kmart website supports these figures.
The holiday shopping season is off to a strong start, which may help give Sears some extra breather. If the U.S. economy does slip into a recession, as many economists fear, it could be the straw that leads to its demise, said Katie Thomas, director of the Kearney Consumer Institute, Kearney’s in-house think tank.
“If consumers are scaling back, it’s hard to justify going to these stores,” she said. “I agree [a recession] Might be the final nail in the coffin. ”
As for when Sears might finally close its last remaining stores, Cohen said it really doesn’t matter at this point.
“The time of death was 2005,” he said, referring to the year Lampert took over the company.