Does making something smaller make it better, or in this case, more profitable? Apparently Sears thinks so. Rather than making the changes needed to attract customers, let's turn them away by not having the item they came looking for!
We've first seen this method used for Kmart's electronics department. It's honestly a mixed bag at times because not all stores shrunk their electronics. From my observations, it seems that mainly stores that don't have any other competition nearby kept the full assortment. Even then though, I was recently at a store with no competition from Walmart and it had shrunk it electronics. Sometimes you can't even make sense of the business decisions made by Sears Holdings!
Then comes the fact that many stores have either closed or they plan to shrink by up to 50% if they can attract another tenant thanks to Sears' REIT plan introduced last year.
I bring this topic up because I saw Sears' plans to make smaller stores based solely on appliances. Seems like a bright idea, right? I would agree if it weren't for the fact that small Sears stores already exist by means of Sears Hometown stores! The funny thing about Sears Holdings spun off the Hometown stores to get some extra cash. So the hometown stores are actually a different company now. So Sears' plan is to shrink and focus on appliances, they just made competition with their own name!
Don't get me wrong though, I applaud the idea of having smaller Sears stores. Sears is known primarily for outdoor equipment, tools, appliances and to lesser extent, electronics. I don't think of Sears when I want to buy new clothes!
I've said for awhile know that it would be in their best interest to focus on making Sears stores smaller. Perhaps focus on Kmart, as Kmart has been the better performer of the two and maybe just simply add a mini-Sears within Kmart. In a way, they kind of already have toyed with the idea right after they merged. Other than by adding appliances to a shrunken electronics department, It just seems that they kind of abandoned it nowadays though. Of course if they were to reintroduce this plan, don't just simply plop boxes on the floor and call it a day. Actually make the area presentable to customers.
Yeah, just had to get my two cents in about a dying retailer that I care about....
I'm with you, sounds like they're creating Sears Hometown stores... to compete with existing, albeit spun-off, Sears Hometown stores. I wonder if they can revoke the license agreement from the Sears Hometown stores in that case? Probably wouldn't be worth it to even try though: this concept will be executed so poorly it won't work out and they won't even have to worry about the naming/competition problem. I hate to say so, but it's a noticeable trend; many of SHC's ideas are good in principle - such as introducing Sears's most popular products into Kmart stores way back when as a store-within-a-store like you mentioned - only to fail in implementation/presentation/upkeep/all of the above. It's great to hear they're trying something new... but I feel like this is just putting a Band-Aid on a severed limb.
ReplyDeleteIt is indeed noticeable. The ideas are there, the execution is not....not to mention the fact that some stores lack customers in the first place.
DeleteYep, that's a major issue too. It's good that they're focusing on their Shop Your Way rewards program as an attempt to retain customers... but then closing their stores damages their customer base. Then there are all the non-member customers who are driven away by the unfavorable public perception of Sears and Kmart, and no matter what concepts they launch I doubt SHC would be able to get them back. I honestly don't see any way that SHC can revert from their downhill slope. That's why it's almost painful to see them try - because we can predict the end result. As we say down south, "Bless their little heart..."
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