Two formerly prominent American retailers announced today that they are closing a significant percentage of their retail outlets following a lackluster holiday season in 2011.
Sears and KMart predate Target (and frankly appear that way), recalling as well an age before Walmart dominated the American landscape so completely- but the two former retail kings have had a rough go of it in the past year. In addition to competing with lower prices and newer facilities at more well-positioned bricks and mortar competitors, online shopping has foregrounded their failure to move forward with their slow-to-update outlets.
Just days after the Christmas season began to wrap up, the companies- which did not experience a stellar sales year in 2011- have announced that between 100 and 120 Sears and KMart outlets will be closing in 2012. Sears declined to say how many- if any- jobs would be a casualty of the closures, but it’s difficult to imagine the remaining stores would be able to absorb the excessed staff from a large number of closures.
As to the chain’s outward appearances, if you feel your local KMart looks dingy and poorly-maintained, it’s not just you. A Credit Suisse analyst cited flagging facilities as part of the reason shoppers have turned away from KMart in the past decade:
The results point to “deepening problems at this struggling chain and renewed worries about Sears survivability,” said Gary Balter, an analyst at Credit Suisse. “The extent of the weakness may be larger than expected but the reasons behind it are not. It begins and some would argue ends with Sears’ reluctance to invest in stores and service.”
Another retail analyst echoed my mother, every time we are forced to go to Sears for any reason:
“There’s no reason to go to Sears,” said New York-based independent retail analyst Brian Sozzi, “It offers a depressing shopping experience and uncompetitive prices.”
An internal memo addressing the store closures predicted the company would “bounce back and become stronger than ever.”
