More Kmart stores closing

[Otto Yamamoto]

Article from yesterday:

https://www.bloomberg.com/news/articles/2016-12-29/sears-jumps-after-lining-up-200-million-to-help-stay-afloat

One wonders how many millions he'll make when the game is over?

That's the suspicion by a lot of people that this is an intentional parting out to squeeze every last dollar.

Disaster Capitalism

XT1254

[adventurernumber1]

It's sad to see the downfall of what was once a large and successful company. I have noticed that the Kmart in Rome, Georgia off of US 27/GA 1/GA 53/GA 20 has just closed down. Here in Dalton, I am not completely certain of the status of the Kmart off of Glenwood Avenue, as I have not been there in a while. I will say that the Kmart off of GA SR 52 is probably on its deathbed. My family actually likes to go to Kmart because it is so desolate and never crowded as a result of its decline. My parents hate going to Walmart because it is the opposite - very crowded and chaotic.

[AlexandriaVA]

Article from yesterday:

https://www.bloomberg.com/news/articles/2016-12-29/sears-jumps-after-lining-up-200-million-to-help-stay-afloat

One wonders how many millions he'll make when the game is over?

That's the suspicion by a lot of people that this is an intentional parting out to squeeze every last dollar.

Disaster Capitalism

XT1254

You say that like it's a bad thing. Why wouldn't Sears wash its hands of its unprofitable (or insufficiently profitable) holdings? That's the whole business strategy of a corporate holding company.

[SP Cook]

You say that like it's a bad thing. Why wouldn't Sears wash its hands of its unprofitable (or insufficiently profitable) holdings?

That really is not what Sears is doing.  Sears seems to be selling the real estate holdings (leasing some of this back to itself, which is obviously a penny wise - pound foolish idea) , and selling off divisions and real estate just to yeild cash.   Eventually it will run out of things to sell. 

This is a little different from the ordinary review of locations that healthy companies engage in.  Think of it as a farmer who owns 400 acres but cannot make money at it, so he sells 40 acres every couple of months.  Eventually he isn't a farmer anymore.

[vdeane]

Plus with Lambert giving loans to Sears, it's likely he's putting himself in a position to profit from the demise of the company.  Basically, he's deliberately running the company into the ground so he can take the money from selling the real estate.  Meanwhile, with any other CEO, Sears and Kmart probably could have been saved.

[LM117]

Plus with Lambert giving loans to Sears, it's likely he's putting himself in a position to profit from the demise of the company.  Basically, he's deliberately running the company into the ground so he can take the money from selling the real estate.  Meanwhile, with any other CEO, Sears and Kmart probably could have been saved.

Bingo.

[LM117]

Has anyone else noticed the elimination of the electronics section in their Kmart? The one here in Danville is nearly gone except with a few DVD bargain bins and a handful of TV's on display. That's it.

When I went to Goldsboro, NC last September and stopped by the Kmart there, their electronics section had been wiped out too, only they took it a step further and also eliminated the checkout counter. Hell, even the sporting goods checkout counter got the ol' heave-ho.

Is this being done to all Kmarts or is this an individual store-by-store deal?

[spooky]

The electronics section in my local KMart is gone. Then again, so is the rest of the store.

[Max Rockatansky]

Has anyone else noticed the elimination of the electronics section in their Kmart? The one here in Danville is nearly gone except with a few DVD bargain bins and a handful of TV's on display. That's it.

When I went to Goldsboro, NC last September and stopped by the Kmart there, their electronics section had been wiped out too, only they took it a step further and also eliminated the checkout counter. Hell, even the sporting goods checkout counter got the ol' heave-ho.

Is this being done to all Kmarts or is this an individual store-by-store deal?

Probably has something to do with the low profit margin of the department.  If the inventory loss is high but the store is still generating a net profit they might just pull electronics and call it a day.  I know there was some Kmart/Sears stores that threw the idea out there, not sure how many executed the approach though. 

[AlexandriaVA]

You say that like it's a bad thing. Why wouldn't Sears wash its hands of its unprofitable (or insufficiently profitable) holdings?

That really is not what Sears is doing.  Sears seems to be selling the real estate holdings (leasing some of this back to itself, which is obviously a penny wise - pound foolish idea) , and selling off divisions and real estate just to yeild cash.   Eventually it will run out of things to sell. 

This is a little different from the ordinary review of locations that healthy companies engage in.  Think of it as a farmer who owns 400 acres but cannot make money at it, so he sells 40 acres every couple of months.  Eventually he isn't a farmer anymore.

There's nothing inherently wrong with liquidating a company and delivering the remaining equity to the owners. It's sort-of cutting losses. Often a better strategy than desperately trying to resurrect the company at the cost of remaining equity or high debt.

Sounds like they're setting up a liquidation strategy. *shrug* We'll see if the shareholders approve.

[SP Cook]

My local K-Mart, which I visit only when I absolutly HAVE to, eliminated its electronics section several years ago.  That space is now taken up with Kenmore stuff and a single aisle of cell phone chargers and cases and batteries.

I had to go in there a couple of days ago and the place is yet worse than it was before.  Random stuff just piled up.  I know it is post-Christmas, but this was beyond that.  It was like no one was even trying to run the place.

[jeffandnicole]

You say that like it's a bad thing. Why wouldn't Sears wash its hands of its unprofitable (or insufficiently profitable) holdings?

That really is not what Sears is doing.  Sears seems to be selling the real estate holdings (leasing some of this back to itself, which is obviously a penny wise - pound foolish idea) , and selling off divisions and real estate just to yeild cash.   Eventually it will run out of things to sell. 

This is a little different from the ordinary review of locations that healthy companies engage in.  Think of it as a farmer who owns 400 acres but cannot make money at it, so he sells 40 acres every couple of months.  Eventually he isn't a farmer anymore.

There's nothing inherently wrong with liquidating a company and delivering the remaining equity to the owners. It's sort-of cutting losses. Often a better strategy than desperately trying to resurrect the company at the cost of remaining equity or high debt.

Sounds like they're setting up a liquidation strategy. *shrug* We'll see if the shareholders approve.

Those same shareholders have the ability to force out the CEO if they didn't like what he was doing, if they could get a majority of shareholders to agree.  It's possible the majority are tied closely to Lambert (I don't have that info near me right now).  The stock price was almost $200 in 2007.  Today it's around $9, down about 80% from when Lambert took over the company in 2013 alone.

[US71]

My local K-Mart, which I visit only when I absolutly HAVE to, eliminated its electronics section several years ago.  That space is now taken up with Kenmore stuff and a single aisle of cell phone chargers and cases and batteries.

I had to go in there a couple of days ago and the place is yet worse than it was before.  Random stuff just piled up.  I know it is post-Christmas, but this was beyond that.  It was like no one was even trying to run the place.

That sounds like the final Days of Hastings: random crap everywhere.

[jeffandnicole]

Since we're talking about Sears here...at Christmastime I purchased something and signed up for their rewards thing.  The emails have been coming, as expected.  What's irritating is every few days, I get a "We haven't heard from you lately" email, and to click confirm.  I clicked it the first time, thinking that I'll get a confirmation email.  Nope...just an advertisement.  And now those type emails come ever few days.  I get plenty of store ads so it's just the age of the internet, but Sears' emails are quite a bit more of an annoyance.

[US71]

Since we're talking about Sears here...at Christmastime I purchased something and signed up for their rewards thing.  The emails have been coming, as expected.  What's irritating is every few days, I get a "We haven't heard from you lately" email, and to click confirm.  I clicked it the first time, thinking that I'll get a confirmation email.  Nope...just an advertisement.  And now those type emails come ever few days.  I get plenty of store ads so it's just the age of the internet, but Sears' emails are quite a bit more of an annoyance.

I would up getting signed up for their "rewards" without my knowledge and keep receiving e-mails from them. But trying to get "points" at the store, they have no record of me. Neither do they have a record of me on-line, yet they still have me as a member on their mailing list.

[Max Rockatansky]

You say that like it's a bad thing. Why wouldn't Sears wash its hands of its unprofitable (or insufficiently profitable) holdings?

That really is not what Sears is doing.  Sears seems to be selling the real estate holdings (leasing some of this back to itself, which is obviously a penny wise - pound foolish idea) , and selling off divisions and real estate just to yeild cash.   Eventually it will run out of things to sell. 

This is a little different from the ordinary review of locations that healthy companies engage in.  Think of it as a farmer who owns 400 acres but cannot make money at it, so he sells 40 acres every couple of months.  Eventually he isn't a farmer anymore.

There's nothing inherently wrong with liquidating a company and delivering the remaining equity to the owners. It's sort-of cutting losses. Often a better strategy than desperately trying to resurrect the company at the cost of remaining equity or high debt.

Sounds like they're setting up a liquidation strategy. *shrug* We'll see if the shareholders approve.

But that's the rub, did it need to be set up for liquidation or did Eddie Lampert make his investments with the current predicted outcome in mind?  There is a lot of speculation that this was his end goal from the start when he muscled in and forced the merger with Kmart.  Now it really doesn't matter what the other share holders think or want.  Given Eddie Lampert's previous investment history it's probably more likely than not that the ultimate demise and parting out real estate was the real long term goal from the start. 

[adventurernumber1]

Perhaps I am wrong, but I feel like my Kmart still has its electronics section. A couple of years back I got a few video games there (albeit I usually go to GameStop to get them), and I also got a new Alan Jackson CD. As far as I know, it is still there today.


Also, I have noticed a dramatic increase in Sears commercials, such as in ads while watching videos on YouTube. I'd say for the most part they are pretty good commercials, but maybe they have come in too late to the game. It is probably a last attempt to save the company, and I understand that. It seems like I just hadn't seen many Sears commercials before.

[AlexandriaVA]

You say that like it's a bad thing. Why wouldn't Sears wash its hands of its unprofitable (or insufficiently profitable) holdings?

That really is not what Sears is doing.  Sears seems to be selling the real estate holdings (leasing some of this back to itself, which is obviously a penny wise - pound foolish idea) , and selling off divisions and real estate just to yeild cash.   Eventually it will run out of things to sell. 

This is a little different from the ordinary review of locations that healthy companies engage in.  Think of it as a farmer who owns 400 acres but cannot make money at it, so he sells 40 acres every couple of months.  Eventually he isn't a farmer anymore.

There's nothing inherently wrong with liquidating a company and delivering the remaining equity to the owners. It's sort-of cutting losses. Often a better strategy than desperately trying to resurrect the company at the cost of remaining equity or high debt.

Sounds like they're setting up a liquidation strategy. *shrug* We'll see if the shareholders approve.

But that's the rub, did it need to be set up for liquidation or did Eddie Lampert make his investments with the current predicted outcome in mind?  There is a lot of speculation that this was his end goal from the start when he muscled in and forced the merger with Kmart.  Now it really doesn't matter what the other share holders think or want.  Given Eddie Lampert's previous investment history it's probably more likely than not that the ultimate demise and parting out real estate was the real long term goal from the start.

Brick and mortar retail is tough and K-mart hasn't been doing it well for a while anyways (vis-a-vis Target and Wal-Mart)...why not cash out on what you've got (real estate)? A company liquidating isn't the end of the world...it's a necessary part of the business cycle.

[Max Rockatansky]

You say that like it's a bad thing. Why wouldn't Sears wash its hands of its unprofitable (or insufficiently profitable) holdings?

That really is not what Sears is doing.  Sears seems to be selling the real estate holdings (leasing some of this back to itself, which is obviously a penny wise - pound foolish idea) , and selling off divisions and real estate just to yeild cash.   Eventually it will run out of things to sell. 

This is a little different from the ordinary review of locations that healthy companies engage in.  Think of it as a farmer who owns 400 acres but cannot make money at it, so he sells 40 acres every couple of months.  Eventually he isn't a farmer anymore.

There's nothing inherently wrong with liquidating a company and delivering the remaining equity to the owners. It's sort-of cutting losses. Often a better strategy than desperately trying to resurrect the company at the cost of remaining equity or high debt.

Sounds like they're setting up a liquidation strategy. *shrug* We'll see if the shareholders approve.

But that's the rub, did it need to be set up for liquidation or did Eddie Lampert make his investments with the current predicted outcome in mind?  There is a lot of speculation that this was his end goal from the start when he muscled in and forced the merger with Kmart.  Now it really doesn't matter what the other share holders think or want.  Given Eddie Lampert's previous investment history it's probably more likely than not that the ultimate demise and parting out real estate was the real long term goal from the start.

Brick and mortar retail is tough and K-mart hasn't been doing it well for a while anyways (vis-a-vis Target and Wal-Mart)...why not cash out on what you've got (real estate)? A company liquidating isn't the end of the world...it's a necessary part of the business cycle.

But that's the thing, Kmart had already failed but Sears had a ton of cash savings.  Had the merger not happen it is hypothetically possible that Sears could have used those reserves to make their stores competitive rather than mow through them once the profits dried up like they had in the last ten years.  Eddie Lampert's investment group got a hold of Kmart after it came out of Chapter 11 and basically was in a pretty sound position to make the merger with Sears happening coming out of that.  I'm sure the investors on both sides could only see dollar signs and thus the merger happened which gave the Kmart group controlling interest in Sears.  Could things been entered into with the best intentions?...possibly but it looks like the true end game was real estate at the end of the day. 

The real shitty thing is that Sears had a pretty healthy pension program that was phased out after the merger.  So what happens now to that pension now once Sears Holdings finally tanks out for good?   Yes it might be part of the natural business cycle for companies to fail, but it is hard not to think this was helped along to line the pockets of a select few investors.  I guess that's what you get when you get in bed with a hedge fund manager when you're blinded by dollar signs in the short term. 

But then again that's all Monday Morning Quarterbacking the Sears situation.  They were already behind the pace retailers like Target and Sears before the merger.  It would be speculative to say that they could have made the updates necessary to get back in competition or maintain their market share.  You go back to something like the Prodigy Online investment for online retail, it makes one wonder what that might have happened if Sears decided to stay at the concept instead of dropping out when the idea was in its infancy. 

[tchafe1978]

Just heard today that the store in Platteville, WI is going to be closing in March, along with 78 other locations. It's actually surprising that store held on as long as it did, as there were never more than a dozen cars in the parking lot. Everybody wondered how it survived. I feel bad for the few people left working there that will be losing their jobs. I'll actually miss the store, as we would go there from time to time to look for something that Walmart might actually not have. And for shoes, as they had a better selection of shoes than Walmart. Now the hope is eventually a store like Target or Shopko will take over the building, rather than have it sit empty for a decade.

[Pete from Boston]

Re: Prodigy, this seemed to me to be the intended extension of Sears's non-core assets Dean Witter, Allstate, Coldwell Banker, and Discover.  The first three of these were clustered in financial service centers in many stores.  Prodigy was envisioned to be something promised a decade earlier and realized a decade later–home transactions of every kind on a personal computer.  The infrastructure (networked home computers) was not there yet.

-  -  -  -

Re: Kmart, anecdotally but representatively, my last trip to Kmart was in Staten Island in October.  I bought a nail clipper and pack of gum, both at the register closest to the door I came in.  I was second in line. The transaction took fifteen minutes.

The cashier waited for another employee to arrive, learn a customer's problem, travel across the store to confirm a price, then return to the register.  For a $1 dispute.  Target gives employees the encouragement and power to give the customer the benefit of the doubt to keep things moving.  Target hires people who can make this judgement.

Kmart management has visibly stopped actively trying to plan for any future for the business.

[catch22]

Just heard today that the store in Platteville, WI is going to be closing in March, along with 78 other locations. It's actually surprising that store held on as long as it did, as there were never more than a dozen cars in the parking lot. Everybody wondered how it survived. I feel bad for the few people left working there that will be losing their jobs. I'll actually miss the store, as we would go there from time to time to look for something that Walmart might actually not have. And for shoes, as they had a better selection of shoes than Walmart. Now the hope is eventually a store like Target or Shopko will take over the building, rather than have it sit empty for a decade.

Here's the list, along with some Sears stores also closing.

http://www.businessinsider.com/list-of-sears-and-kmart-stores-closing-2017-1

The three Kmart stores closest to me are also closing -- Garden City, Westland and Plymouth, MI.  The GC store is the very first Kmart, which opened in 1962.  My family checked it out on its opening day (I was 10).

[Brandon]

Just heard today that the store in Platteville, WI is going to be closing in March, along with 78 other locations. It's actually surprising that store held on as long as it did, as there were never more than a dozen cars in the parking lot. Everybody wondered how it survived. I feel bad for the few people left working there that will be losing their jobs. I'll actually miss the store, as we would go there from time to time to look for something that Walmart might actually not have. And for shoes, as they had a better selection of shoes than Walmart. Now the hope is eventually a store like Target or Shopko will take over the building, rather than have it sit empty for a decade.

Here's the list, along with some Sears stores also closing.

http://www.businessinsider.com/list-of-sears-and-kmart-stores-closing-2017-1

The three Kmart stores closest to me are also closing -- Garden City, Westland and Plymouth, MI.  The GC store is the very first Kmart, which opened in 1962.  My family checked it out on its opening day (I was 10).

Fuck me, Garden City's closing!  That's the first Kmart, ever, and to see it close, spells the beginning of the end of the chain, IMHO.

[kkt]

The Lynnwood, Washington, Sears is closing.  They used to be my go to place for tools.

[US71]

The Lynnwood, Washington, Sears is closing.  They used to be my go to place for tools.

2017 may be the death of K-Mart and Sears.