We all saw it coming. Sears was plummeting towards bankruptcy and last week it finally happened. Overladen with debt that had been leveraged way too high to service the payment. There are so many factors here from poor management, private equity games and lack of innovation. At one point, Sears was the great American store.
Very similar to Amazon, Sears changed the way American’s shopped. They began with a catalog so everyone could order what they needed (just without the internet) and have it delivered to their door. They even delivered pre-fab houses at costs that made it affordable for most people to have a roof over their head. I am 99% sure that the Craftsman Home we have in Venice, CA is an off the shelf Sears and Roebuck home. It still stands today although it is in need of some major work to make sure it will be standing in another 100 years.
I have been thinking about my shopping experiences with Sears over the decades. Sears was the anchor store at Montgomery Mall in MD where I spent my teenage years. We would always stop at Sears for records, clothes, a new dishwasher and anything else we needed. I remember when they partnered with a few designers and created pop-up stores inside the teen section. Cutting edge stuff.
For some reason, I had my father’s Sear’s credit card. There was a store near Simmons College where I went to school on the backside of a defunct building. They only carried appliances in there. My father was not very forthcoming with any help except he did pay my tuition so I went into Sears one day and bought myself a refrigerator and a few other items because it was the only card I had of his and the bill went to him.
Doing business with Sears when I was running a company in the garment center was a big score. I finally broke in with a jacket that the buyer was willing to give me an order for 1800 units to see what it would do. The jacket hit the racks and had a 25% sell-through immediately. The buyer was thrilled. She told me that she needed to get back into the jacket asap and was going to send me over an order that afternoon. We could work on the fabric allocations based on that order. Sometime in the mid-afternoon, a fax came in (yep a fax) and we could see it was coming from Sears based on the area code. The order was for just over $1m dollars on one jacket. It was huge. It completely changed the trajectory of the company. Sears had that type of buying power.
On on hand, it is sad to see Sears close their doors as I can’t imagine that it is going to do anything but that regardless of them trying to come back. They have already sold off the majority of the assets and what is left is the real estate. The brand changed American but now we are in another time, a new zeitgeist.
High-end retail stores with handheld service with highly curated merchandise continue to work. Massive brands like the Gap that have become commodities and don’t really need multiple retail stores anymore. Retail is going through a major change. People will shop in stores, as I saw plenty in Japan packed to the gills, but the question is what is going to keep them coming back and who are the creatives of this next retail movement that will make this happen? It certainly is not the leaders behind Sears.