That window of online opportunity has come and gone, and so is much of the cash that could have eased an effective transformation. At the same time, repeated leadership changes since left the company without a consistent direction, said Karabus.
In late , Sears Canada announced it was selling off five major locations across Canada , including its flagship Eaton Centre location in downtown Toronto. Not long after, Sears Canada exported cash to the U. At the time, Lampert owned 28 per cent of Sears Canada through his hedge fund and another 10 per cent personally.
That dividend payment was preceded by three other special dividends, one in and two in Atkinson said some of the blame for Sears Canada's current woes rests squarely on Lampert's shoulders. It's lost an enormous amount of its experienced, committed talent. You would have to recreate the organization almost from scratch. You'd have to restore the company's trust in the eyes of customers, which is something that, arguably, would never be able to be accomplished.
Pseudonyms will no longer be permitted. By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. It started by selling a single product category.
But when it became clear that a sleepy, overpriced retail sector would crumble before it, there was nothing to stop the company from selling anything and everything.
You could order from the comfort of your own home. You could pay a fair price. It would ship the goods right to you. Sales exploded, and if you'd picked up a big enough chunk of stock when the company went public, you'd never have to work again. That description once applied to Sears, Roebuck, and Co.
Having played the role of an upstart retail juggernaut in the s, Sears now finds itself in the same position as the rural general stores it used to drive out of business en masse. On the other hand, Sears' demise is not all Amazon's fault, nor is it a simple circle-of-life parable.
Sears made its share of mistakes. As of Oct. Penney has done even worse, but Lowe's, Best Buy, and Home Depot have all seen their share prices at least double. Amazon shares, on the other hand, are up nearly fold. Even for a brick-and-mortar retailer in the digital era, Sears is struggling. In the mids, Richard Sears worked as a station agent for the Minneapolis and St. Louis Railway in North Redwood, Minnesota. He would sell lumber and coal on the side, giving him experience that came in handy when, in , a local jeweler rejected a shipment of gold-filled watches from Chicago.
Sears bought them himself, sold them at a profit, and ordered more. He founded the R. Roebuck, a watchmaker from Indiana. Both were in their twenties.
They launched a catalog of watches and jewelry the following year and incorporated Sears, Roebuck, and Co. Two years later, a Chicago clothing manufacturer, Julius Rosenwald, bought into the company. By that time, the mail-order operation branched out from watches. Farmers, fed up with understocked and overpriced general stores, flocked to Sears. The company sold stock in in the first initial public offering IPO for an American retail firm—the first to be handled by Goldman Sachs.
It opened a acre logistics center in Chicago that very same year. Henry Ford eventually made a pilgrimage to this "'seventh wonder' of the business world" to learn about the company's storied efficiency. Sears Holdings was delisted from the Nasdaq in Oct. Ford would throw a wrench in Sears' business model, as cars made chain stores more appealing and mail-order catalogs less crucial for rural customers.
Sears adapted, opening retail stores in the s that outsold the catalog by The company began to introduce its own brands in the s, including Craftsman, DieHard, and Kenmore. It began selling insurance through its Allstate subsidiary in In , Sears, the largest retailer in the world, began construction on the world's tallest skyscraper.
The Sears' Tower's completion four years later may not mark the company's peak, but its retail dominance began to fade around that time. In the s, it adopted a "socks and stocks" strategy, expanding into financial services beyond its existing insurance business. It launched Discover Card through Dean Witter in Built on a private network, it was distinct from the Internet but presaged it in many ways, offering email, games, news, weather, sports, and shopping.
It took parts of Dean Witter and Allstate public, then distributed the remaining shares to investors. Sears also sold Coldwell Banker, along with other financial services subsidiaries. Sears discontinued its famous catalog in According to the company archives, it "returned to its retailing roots" by Investors began to worry that the earlys recession made credit card issuance too risky, and Sears sold the business to Citigroup C in At the turn of the century, Sears turned to the web in earnest.
A July press release boasted that sears. At that time, Sears' problem was not so much Amazon as it was Walmart, which became the nation's largest retailer in the s. The combined companies—to be headquartered in Chicago and called Sears Holdings—would operate around 3, locations.
Analysts expressed excitement at combining the fading giants' mainstays, cross-selling brands such as Sears' Craftsman and Kmart's Martha Stewart Everyday. Lampert left Goldman to start a hedge fund in at the age of 25 and bought up Kmart's debt when the retailer declared bankruptcy in As chairman of the combined company—he took on the CEO role as well in —Lampert initially attracted breathless praise from the media.
A Bloomberg Businessweek cover story called him "the next Warren Buffett. A little over 13 years later, such comparisons seem ridiculous. Few retailers in Canada are looking to expand aggressively when they are more focused on beefing up their e-commerce sales. And big foreign retailers aren't rushing to enter Canada and fill the void of shrinking incumbents. Some Sears leases are complicated by restrictions on tenant uses, such as only allowing another department store to fill the space.
Marcovitz said. Even so, a number of retailers stand to profit from Sears's woes. One of them is archrival Hudson's Bay Co. Latif said. Simons is one of the few retailers in this country that is rapidly expanding. And retailers such as Canadian Tire and Wal-Mart have been interested in potentially picking up some parts of Sears, most notably its rights to prominent brand names such as Kenmore appliances, industry sources said.
The fact that Sears has retained Osler, whose lawyers represented Target Canada in its insolvency proceedings, is no coincidence, Mr. Brzezinski said. The only really valuable asset left at Sears is its trademarks, he said. Sears Canada said it is looking at its strategic alternatives as its struggles to meet its financial obligations, considering a range of options from a sale to a revamping. Sears Canada shares tumbled more than 24 per cent to 87 cents on the Toronto Stock Exchange.
While Sears has showed signs of progress in its transformation efforts, including adding discount designer lines to its offerings, it is running out of sources of liquidity to implement its business plan. The loan setback and the lack of available alternative sources of liquidity — through real estate or other asset sales — "mean there are material uncertainties as to the company's ability to continue to satisfy its obligations and implement its business plan in the ordinary course," Sears said.
Sears said it has struck a special committee of its board of directors to help in the process of seeking alternatives. It is postponing its annual meeting, which was scheduled for Wednesday.
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