Should Sears sell its Craftsman, DieHard and Kenmore brands?
Sears’ long downward spiral continues. Following another quarter of disappointing sales, the company has gone public about potentially making its few remaining valuable brand assets — Craftsman, DieHard and Kenmore — available in a larger number of outlets outside of Sears or Kmart stores. The other option is selling one of more of the brands outright.
Expanding the sale of the brands to other retailers is not a new concept. Under Edward Lampert, Sears Holdings has been tinkering with the idea going back to at least 2005 when it first introduced Kenmore and Craftsman products to a Kmart in Norridge, IL.
In 2006, vendors to Sears began telling the press, off-the-record, that the department store was killing its most famous brands due to cuts in advertising. The decision by Mr. Lampert to neglect store remodels further hastened the chain’s decline.
According to a TWICE report, the Kenmore appliance brand held a 27 percent market share in 2004. Today, the brand accounts for 12.5 percent of appliance sales.
Same-store sales at Sears were down 7.1 percent in the chain’s first quarter. The company pointed to weakness in apparel, appliances, consumer electronics, footwear and Sears Auto Centers as the biggest factors in the decline.
- Sears Holdings Reports First Quarter 2016 Results And Other Corporate Developments – Sears Holdings Corporation
- Sears Revenue Declines, Retailer to Explore Deals for Key Brands – The Wall Street Journal (sub. required)
- Sears Looking to Cash Out Kenmore as Losses Widen – TWICE
- Coming soon to retailers other than Sears: Kenmore Appliances – RetailWire
- Kmart looks to build business with power tools – RetailWire
- Vendors: Sears brands dying slow death – RetailWire
DISCUSSION QUESTIONS: Is Sears done as a retailer? What would you do with Craftsman, DieHard and Kenmore if you were running Sears Holdings?