Seeking Alpha

You won't find this in Sears' (SHLD -6.5%) dismal earnings report, but it's far more important...

You won't find this in Sears' (SHLD -6.5%) dismal earnings report, but it's far more important in the long run: Its stores are dumpy. Retail experts say Sears has spent much less on remodeling and updating its aging stores than competitors such as Macy's and Wal-Mart. While store chains traditionally spend $6-$8/sq. ft. on annual maintenance, Sears spends ~$1.90.
Comments (6)
  • 0ZJ
    , contributor
    Comments (69) | Send Message
     
    Sounds about right.

     

    I go to Sears every now and then to buy or replace tools. It's like stepping back in time. The store I use is essentially unchanged in the last 25 years.

     

    The effect a decent renovation can have on a store is amazing. My local Giant (mid-Atlantic independent grocer) updated itself for the first time since the 80s and the place went from seemingly failing to "can't find a parking space" packed every day of the week without changing a single thing on the shelves.
    17 Nov 2011, 10:21 AM Reply Like
  • Dr. Poly
    , contributor
    Comments (360) | Send Message
     
    People always need to have groceries and will shop at places that are newer - you just have a sense that the meat might be safe. I suspect Giant has a more competitive pricing strategy. Kmart does not compete with Wal-Mart on price - that is what got them into trouble. So, if they updated the place I think they would not benefit unless they put more attractive pricing into place. The Sears by me has nice tools - for a department store - but I would not argue that they have it well organized. Eddie is running this place unlike he did with Autozone - he believes there is some residual value in the real estate, especially the locations, but the Sears and KMarts I see generally blight the area around them since no one goes to Sears, why would you go to the shops/restaurants around Sears? Sears is way overvalued - they are attempting to leave Illinois and are blackmailing the state that they will move to NC after having moved their HQ to a suburb of Chicago after leaving the Sears tower. The real issue is that this is a failing enterprise and they are trying desperately to move to NC to reduce costs - as if that's their only problem.
    17 Nov 2011, 10:36 AM Reply Like
  • Windsun33
    , contributor
    Comments (4225) | Send Message
     
    I was in a local Sears store a few days ago, for the first time in about 3 years. About the only section that really seemed to have been updated was the tools (Craftsman) sections. Though I admit I did not tour the women/girl sections.
    17 Nov 2011, 10:23 AM Reply Like
  • Kurt Moeller, CFA
    , contributor
    Comments (4) | Send Message
     
    If Sears disappeared tomorrow, would any consumers truly miss it? Of course not.
    17 Nov 2011, 10:42 AM Reply Like
  • wapiti
    , contributor
    Comments (694) | Send Message
     
    what do you expect from ESL? Have you been to a K Maart lately? Same owner!
    17 Nov 2011, 11:01 AM Reply Like
  • Windsun33
    , contributor
    Comments (4225) | Send Message
     
    You have a point. I seldom shop Sears or K-Mart except for occasional houseware items, and as often as not end up buying them from (JCP) or (DDS) as the selection of many items at Sears seems to have gone downhill in the past few years.
    17 Nov 2011, 11:44 AM Reply Like
DJIA (DIA) S&P 500 (SPY)