Softer Side Is Hard On Sears’ Bottom Line

Aug 05, 2004

By George Anderson

Sears’ management believed when it bought Lands’ End two years ago that it would help the company finally get its act together on the clothing side of business.

Sears’ management appears to have been wrong — again.

The retailer announced it was scaling back the sale of Lands’ End apparel in some categories because the consumers who shop at Sears are not willing to spend more than they normally
do to wear clothing with the brand’s tag attached.

Alan Lacy, Sears’ chief executive has acknowledged, “We’ve had some price-value issues, most notably in the kids’ area. We’ve cut back kids, broadly speaking, mostly in infant
and toddler.”

Carol Levenson, research director for Gimme Credit Publications told the Chicago Tribune that Sears “seems fated to make the wrong bet on apparel time and time again.”

“We fear that after a quarter in which management blamed weak apparel sales on the lack of fashionable merchandise in its stores, the company will load up on ponchos and bright
colors just when these fads are fading,” she said.

In a related piece of news, Sears announced it would begin selling its full line of clothing online. Up till now, consumers have been able to purchase school uniforms directly
from the Sears’ site and other merchandise from its catalog divisions such as Lands’ End.

Moderator’s Comment: What’s the problem with Sears’ softer side? Where does it go with its apparel business?

Steven Keith Platt, director of Platt Retail Institute says Sears problems come down to execution. “Sears itself has noted issues related to inventory,
a missed spring selling season, and Lands’ End positioning problems in the stores,” he said.

George Anderson – Moderator

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