Sears fights to regain market share

Once America’s largest retailer, Sears is today struggling to remain a significant player in product categories it once dominated – paint, tools and household appliances. This year it has suffered same-store sales declines, whereas competitors like Home Depot, Lowe’s, Wal-Mart and Target have recorded gains. The second quarter (to 3 July) saw like-for-like sales in the USA down by 2.9 per cent on the same period last year. Same-store sales in June alone were 3.1 per cent lower, followed by a 2.6 per cent decline recorded in July.
The company is going to pursue a more aggressive growth strategy. This envisages single-storey, stand-alone stores similar to those run by its competitors – and carrying out the policy by buying outlets once occupied by Kmart and Wal-Mart.
Sears Grand sales are beating projections by 30 per cent.
Its latest test concept, Sears Grand, apparently is beating sales projections by 30 per cent and is the primary vehicle with which Sears intends to regain market share. Sears Grand (profiled in DIY in Europe 7-8/04) offers dominant assortments of Sears’ private brands in key categories, supplemented by select national brands, but also includes electronics, clothing and some food products in the range. The new format is similar to a discount store, but with the emphasis on categories where Sears has always been dominant.
The company says it expects to be operating 70 off-mall locations by the end of next year. Some 12–14 of these will probably be a new mid-size Sears Grand format, which is better suited to the Kmart and Wal-Mart locations being taken over.
The Great Indoors, the company’s one-floor store concept, is not being expanded.
Apparel, home fashions and home entertainment have been some of the strongest departments in Sears Grand, officials say. Some tweaking of inventory has become necessary, as the original stores failed to offer enough items in electrical, plumbing and hardware. These shortcomings were quickly recognised, officials say, and plans were underway to strengthen the categories.
Its major appliance department is also under attack by Lowe’s, a long-time appliance seller, as well as Home Depot, which added this category to its 1 500+ stores several years ago and quickly became the third largest appliance retailer in the USA. Sears plans to add 30 stand-alone appliance outlets in order to bring these products closer to consumers. It turns out that customers at present have to travel some distance to a major mall store to be…