Author Topic: R.I.P. Sears  (Read 4192 times)

JenniferW

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Re: R.I.P. Sears
« Reply #50 on: October 16, 2018, 01:56:35 PM »
Is it possible Amazon would buy Sears and SHLD would skyrocket?

Paul der Krake

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Re: R.I.P. Sears
« Reply #51 on: October 16, 2018, 02:20:32 PM »
A lot of modern capitalism is built on the backs of exploited workers around the world, and Amazon has just found a way to "create American jobs" by exploiting local American workers instead of just the Vietnamese ones.  Most of the labor that makes our lifestyle possible is very much "overworked, underpaid, poor working conditions" but most of us don't mind when those poor folks are Chinese factory workers or Indonesian seamstresses.  Why is it suddenly so much more problematic when they're American college drop-outs?  At least here in America, the workers that Amazon exploits get health insurance and sick leave, and work in facilities with functioning fire alarms and proper ventilation.
You don't need to go to Asia to find exploitative jobs that Americans rely on, just look at what's on your plate.

Agricultural work is paid peanuts, offers no benefits or safety net of any kind, but they don't participate in e-verify and no American-born workers take those jobs, so nobody gives a shit.

ChpBstrd

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Re: R.I.P. Sears
« Reply #52 on: October 16, 2018, 07:53:41 PM »
Is it possible Amazon would buy Sears and SHLD would skyrocket?

There is much cheaper warehouse space available than in malls. On the other hand, I could imagine somebody using Sears to launch a new business model. Indoor electric car dealerships? Prefab modular home showroom? Some new healthcare model that requires mall-level foot traffic and parking? Some sort of business incubator?

It won't be apartments - those boxes usually have no windows, and installing plumbing would be a PITA. As with warehouses, some options cost less to start from scratch.

ILikeDividends

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Re: R.I.P. Sears
« Reply #53 on: October 16, 2018, 08:07:22 PM »
Is it possible Amazon would buy Sears and SHLD would skyrocket?
Severely distressed assets don't typically command a huge premium in price.  I suppose a strategic case could be made for Amazon wanting to acquire Sears (a-la a Whole Foods kind of buy out), but the price would factor in the cost to service Sears' debt, which Amazon would then own.

A marginal bump in stock price, yeah, maybe, but I think skyrocket is pretty much off the table no matter what happens to Sears at this point.  For this to happen, Sears assets would have to fit pretty cleanly within an as yet unannounced strategic vision for Amazon's growth path.

And even if it did fit perfectly, Amazon might be better served by waiting for Sears to slide into chapter 7, and then buy up those assets free and clear of debt at fire sale prices.  Who would pay full price for your house, or even just agree to assume the mortgage, after it had already burned to the ground?  At this point, Sears is just a smoldering pile of rubble with a mortgage that can't be serviced.
« Last Edit: October 16, 2018, 08:33:37 PM by ILikeDividends »

mies

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Re: R.I.P. Sears
« Reply #54 on: October 17, 2018, 04:45:34 AM »
Is it possible Amazon would buy Sears and SHLD would skyrocket?

There is much cheaper warehouse space available than in malls. On the other hand, I could imagine somebody using Sears to launch a new business model. Indoor electric car dealerships? Prefab modular home showroom? Some new healthcare model that requires mall-level foot traffic and parking? Some sort of business incubator?

It won't be apartments - those boxes usually have no windows, and installing plumbing would be a PITA. As with warehouses, some options cost less to start from scratch.

I think if Amazon did anything relating to Sears properties, they would wait until the malls that hosted the old Sears stores died. Here in Cleveland, two dead malls have been demolished and turned into fulfillment centers. One just opened recently, and the other is slated to open sometime next year.

GoCubsGo

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Re: R.I.P. Sears
« Reply #55 on: October 17, 2018, 11:05:33 AM »

When my kids were young, on a clear day I would pull out of my driveway and my kids would say "Look, you can see the Sears Tower" (it was re-named Willis Tower years ago).  I hope their kids will still call it that.  Sears employed a lot of people in the Chicago area and there are 3-4 Sears homes on my street alone (including one that's worth close to $700K). 

I'm nostalgic for the company, but they deserve to be out of business.  Oddly enough, I live near an affluent mall that is in the middle of a complete re-construction of a Sears anchor store that will still house Sears on the top floor and a brick and mortar version of Ballard Design which I think was an online only store ala Wayfair. 

FireLane

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Re: R.I.P. Sears
« Reply #56 on: October 18, 2018, 01:01:59 PM »
From what I've read about Sears' decline, it's not just that they couldn't compete with Amazon, it's that the billionaire who bought the company actively ran it into the ditch with absurd management theories:

https://www.bloomberg.com/news/articles/2013-07-11/at-sears-eddie-lamperts-warring-divisions-model-adds-to-the-troubles

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Many of its troubles can be traced to an organizational model the chairman implemented five years ago, an idea he has said will save the company. Lampert runs Sears like a hedge fund portfolio, with dozens of autonomous businesses competing for his attention and money. An outspoken advocate of free-market economics and fan of the novelist Ayn Rand, he created the model because he expected the invisible hand of the market to drive better results. If the company's leaders were told to act selfishly, he argued, they would run their divisions in a rational manner, boosting overall performance.

What this meant in practice is that Lampert ordered the heads of different departments to compete with each other as if they were separate businesses, complete with their own boards of directors, their own separate marketing and their own profit-and-loss statements.

Not surprisingly, this resulted in the different branches of the company squabbling and trying to undermine each other, as opposed to (for example) having loss-leader sales in one department that could draw people in to browse the rest of the store:

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As some employees had feared, individual business units started to focus solely on their own profitability and stopped caring about the welfare of the company as a whole. According to several former executives, the apparel division cut back on labor to save money, knowing that floor salesmen in other departments would inevitably pick up the slack. Turf wars sprang up over store displays. No one was willing to make sacrifices in pricing to boost store traffic.

Sears was competing with itself, treating its own internal store brands as if they were third parties who should be squeezed as hard as possible:

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Appliance maker Kenmore is a widely recognized brand sold exclusively at Sears. Under SOAR, the appliances unit had to pay fees to the Kenmore unit. Because the appliances unit could make more money selling devices manufactured by outside brands, such as LG Electronics, it began giving Kenmoreís rivals more prominent placement in stores. A similar problem arose when Craftsman, Searsís beloved tool brand, considered selling a tool with a battery made by DieHard, also owned by Sears. Craftsman didnít want to pay extra royalties to DieHard, so the idea was quashed.

For all that we blame Amazon, most of the retail chains that are going out of business have serious problems of their own. I've heard similar things about gross incompetence at Toys-R-Us.

solon

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Re: R.I.P. Sears
« Reply #57 on: October 18, 2018, 02:38:34 PM »
I wonder what will happen to my Citibank Sears card if they go bankrupt?

dixonge

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Re: R.I.P. Sears
« Reply #58 on: October 18, 2018, 04:11:18 PM »

OurTown

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Re: R.I.P. Sears
« Reply #59 on: October 23, 2018, 02:01:30 PM »
By the way, just what in the everlasting fuck is this?  https://www.wards.com/

solon

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Re: R.I.P. Sears
« Reply #60 on: October 23, 2018, 02:07:38 PM »
By the way, just what in the everlasting fuck is this?  https://www.wards.com/

It has the same name, but obviously a completely different company. Colony bought the brand but that's it.

https://www.wards.com/cm/history-about-us.html

GreatLaker

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Re: R.I.P. Sears
« Reply #61 on: October 25, 2018, 01:17:34 PM »
There was a book about Sears reinventing itself back in the 1970s. Ironic that 4 decades later it faces even bigger challenges and existential threats. Businesses need to realize they need to always respond to changing competition and markets. Companies like Amazon and Google have that DNA, whereas many older ones do not or have lost it over time and success.

https://www.goodreads.com/book/show/21209480-the-big-store

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The Big Store: Inside the Crisis and Revolution at Sears

In 1972, Sears, Roebuck & Co. was the quintessential American success story. It accounted for over one percent of the gross national product. Suddenly, it found itself in a downward spiral. Award-winning journalist Donald Katz was given unrestricted access to Sears's records and executives to write this revealing account of the downfall and resurrection of an American icon.

Paul der Krake

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Re: R.I.P. Sears
« Reply #62 on: October 25, 2018, 02:15:30 PM »
Another ironic twist: Goodreads.com is an Amazon company too.