As Sears celebrates its 125th anniversary, it isn’t the same as it once was — a household name, “the everything store” and the largest retailer in the U.S.
That title was lost to Walmart in the early 1990s, and Sears put an end to its iconic mail-order arm shortly thereafter. (Some would argue Amazon is now considered “the everything store” of the 21st century.)
Sears shares hit an all-time high of $195.18 in April 2007, but currently trade under $4 apiece. The declining market capitalization reflects the stress the retailer is under. It’s been strapped for cash and grappling with mounting liabilities, with much of Wall Street and other industry experts convinced there’s no hope of a turnaround in sight.
From this point, Sears CEO Eddie Lampert envisions a much smaller business and his goal is still to get back to profitability. This was the theme of the company’s latest shareholder meeting, where he highlighted the fact that Sears was able to eek out a profit during the latest quarter. A crowd of roughly 70 shareholders and a smattering of employees sat engaged as he spoke. Some applauded him for his efforts during a Q&A session.
After the meeting, Lampert spoke with CNBC and made it clear he wasn’t ready to leave Sears just yet.
“Leonard Green walked away from Sports Authority. Sycamore has walked away from certain businesses. Target walked away from Canada,” he said. “I’ve tried to give [Sears] a lot more runway. I’ve tried to make sure that the stores we operate are profitable.”
Lampert’s vision, as described in a chairman’s letter in 2005, was to create a “performance-oriented” company. “We intend to build on the historic strengths of both [Sears and Kmart], while overcoming some of the more recent weaknesses,” he said at the time.
But Lampert told CNBC earlier this month that the company had a difficult time clawing its way back, especially in the wake of the Great Recession. Consumers fundamentally changed their behavior, becoming more price sensitive, doing more research and shopping online, and the shift away from the mall sped up.
Since its merger with Kmart in 2005, Sears has since spun off Lands’ End, sold the Craftsman tool brand to Stanley Black & Decker and closed hundreds of stores, roughly 250 of which were put into a real estate investment trust offshoot known as Seritage. Lampert and his team are still looking for ways to raise liquidity, including other asset sales.
“There are so many pressures today, I don’t think that Sears is going to be able to survive,” Vicki Howard, author of “From Main Street to Mall: The Rise and Fall of the American Department Store,” told CNBC. “My father loved Sears. It was the place he would go to get tires … and things any new homeowner would need.” But that was before Home Depot, Lowe’s and Costco flooded the picture.