After being the country’s premier retailer until the 1980s, the company that owns the Sears and Kmart chains went bankrupt in less than two years. Another trip to the bankruptcy court this year was avoided as the Covid-19 pandemic sent department store chains like JCPenney and Neiman Marcus through their own bankruptcies while others like Lord & Taylor and Century 21 announced they were going out of business.
The fact that Sears isn’t bankrupt isn’t a sign of health, according to experts. The company has made little effort to revive the business, increase sales, or get the failed business back on track. It is possible that Sears may have ceased its business earlier this year, except that the commercial real estate business has faltered and Sears would likely find few – if any – suitable deals on its fortune.
“Everything can be won. But of course there is no market for department stores, ”said Mark Cohen, director of retail studies at Columbia University, a former Sears executive himself. “They are done for all intents and purposes. ”
Without a viable exit strategy, both Sears and Kmart are slowly and quietly dying. They close stores whenever possible and list virtually all other locations with commercial real estate agents.
There is little benefit to Sears in filing for bankruptcy, despite all the losses the now privately owned company is sure to make (Sears finances are not public). . Bankruptcy is useful for reducing debt or other liabilities, but a financial institution or seller is unlikely to have granted credit to Sears and Kmart since they completed their previous restructuring in early 2019, said Reshmi Basu, a retail bankruptcy expert at Debtwire.
So the Sears and Kmart brands are life sustaining because there is so little to gain when they close completely. As soon as the commercial real estate market improves and new tenants can be found for their remaining businesses, the experts believe that Sears will come under more pressure to close the chains.
« Sears is waiting for the market to lower, » said Neil Saunders, managing director and retail analyst at research firm GlobalData.
The company has resold its brands, which still have a certain value. A year ago a deal was signed to sell the DieHard car brand to Advance Auto Parts for $ 200 million. The company sold Innovel Solutions, its product delivery and installation business, to Costco for $ 1 billion under a contract announced in March. Stanley Black and Decker bought the tool brand Sears’ Craftsman in 2017, and the company has been looking for a buyer for its Kenmore equipment business in recent years.
While the company’s spokespersons wouldn’t answer questions about his financial situation, plans, or remaining store numbers, Sears and Kmart store locators only show 74 Sears department stores and 48 Kmart on their websites.
These 122 locations represent 60 fewer Sears stores than they did in May when malls reopened after « non-essential » retailers previously closed to combat the pandemic. And it’s less than 400 stores since bankruptcy and almost 1. 000 stores in February 2018, less than three years ago.
Sears, vaccine, AstraZeneca, Oxford University, Kmart
World News – USA – Sears dies of silent, invisible death – KTVZ
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