When speaking about the chain of retail stores in US, some of the thoughtful name that appears would be Walmart, Target, Best Buy, Sears etc. Sears– A chain of departmental stores that was started in 1886 by Richard Warren Sears and Alvah Curtis Roebuck and that’s how it got the name Sears, Roebuck & Company or simply called as Sears. Currently Sears struggle to survive in the market due to huge losses they have suffered in the past.
Sears struggle for survival has gone through many ups and downs in the past with Kmart buying the company in 2005, which after getting out of bankruptcy renamed itself to be Sears Holdings.
In past few years Sears struggle to survive in the domestic market wherein in 2013 it was the fifth largest departmental store in terms of sales after Walmart, Target, Best Buy and Home Depot and twelfth largest store in the whole country. Considering the current financial position of the company, its total outstanding debt is $4.2 billion which one year back was $3 billion. Till date the company had suffered a loss of $10.4 billion since 2010.
Sears struggle to survive is clear evident in the strategic decisions taken by the company representative to sell some of their assets and stores to get some liquid funds. They have already sold their craftsman brand to Stanley Black and Decker. Sears is confident about its financial position by focusing completely on the transformation plan to be executed effectively.
Sears has been in trouble since their merger with Kmart in 2005. Sears had in total 3,400 stores in USA out of which more than fifty percent of the stores are sold out remaining with only 1,400 store which adversely affected the total strength of employees in the company decreasing from 355,000 to just 140,000.
The downfall of Sears started with the existence of new low price competitors like Walmart and Home Depot 20 years back. After the entry of the giant online retailer like Amazon, the situation became worse for Sears. Sears used the traditional way for survival in the past when the competition was heated among the online retailers and other low cost competitors. Instead of focusing of improving the brand and creating brand awareness, Sears used the traditional approach to cut down on the advertising cost and chose to shut down some of their stores.
Sears has been in existence much before the other competitors like Walmart and Amazon were born and captured the market and still have some hope to rise back with the current borrowing from the financial creditors of $140 million.