Sears faces Craftsman competition of its own making
Photo: Craftsman
Two primary strains of thought popped up a couple of years ago when the news first broke that Sears Holdings was exploring the sale of its Craftsman brand. The first was that management at Sears was about to take a step that would weaken the retailer’s competitive point of difference in the market. The second was that whatever company acquired Craftsman would likely do a better job with the brand than Sears had.
James Loree, CEO of Stanley Black & Decker (SBD), the company that acquired the rights to the Craftsman brand last year, is certainly among those who subscribe to the latter theory.
"We ended up simply buying the brand because the products had been left to devolve over time to the point where they weren't the high quality, respectable products they once were — they had migrated from made in America to virtually everything being made in China and Mexico," Mr. Loree told TheStreet in a recent interview.
Last week, SBD announced the launch of a new line of 1,200 Craftsman tools. Initially, 40 percent of the line will be made in the U.S. with the goal of producing 70 percent within the next few years.
The $900 million deal in January 2017 between Sears and SBD allowed both companies to produce and sell the brand while adhering to shared quality guidelines. At the time, only about 10 percent of Craftsman tools were sold outside of Sears. SBD, which will sell its line in Lowe’s and Ace Hardware stores and on Amazon.com, is focused on significantly upping that percentage.
Publicly, at least, Sears isn’t sweating this new competition of its own making. Tom Park, president of the Kenmore, Craftsman and DieHard brands at Sears, writing on the company’s blog, asserted that the retailer still offers the biggest selection of the tool line and that it will receive sales royalties from SBD for 15 years.
“Make no mistake, we’ve been the home of what is arguably America’s most iconic tool brand and we’re so proud to continue to offer Craftsman products right here at Sears and Kmart,” wrote Mr. Park.