Scores of Sears, Kmarts to close
Dec 28, 2011 (Menafn - The Honolulu Star-Advertiser - McClatchy-Tribune Information Services via COMTEX) --While Sears has been a household name for generations of Hawaii residents, the dated department store chain has gradually lost much of its appeal with younger shoppers.
Sears Holdings Corp., the parent company of Sears and Kmart, said Tuesday it will close as many as 120 of its 3,560 stores nationwide to raise cash following a weak holiday shopping season and years of declining sales.
The company did not specify which stores it will close and did not return the Star-Advertiser's calls to discuss whether any of the seven Sears and seven Kmart stores in Hawaii will be shuttered.
Sears pledged to refocus its efforts on stores that are profitable.
Historically, Hawaii's department stores have done better than the national average because of tourists and loyal local customers, said Honolulu retail consultant Stephany Sofos.
Sears, a pillar of American retailing that began with a mail-order catalog in the 1880s, saw its stock drop 27 percent Tuesday following the announcement.
The retailer has struggled with declining sales and deteriorating stores as rivals such as Wal-Mart Stores Inc. and Target Corp. spruced up their spaces and diversified into one-stop shops.
The projected closings, which represent only about 3 percent of the company's U.S. stores, is expected to generate 140 million to 170 million in cash from the sale of store inventory.
Same-store sales at the Sears and Kmart fell 5.2 percent in the eight weeks ending Dec. 25. By contrast, such sales in the department-store sector as a whole will climb an estimated 4 percent in November and December, compared with the same period a year ago, according to the International Council of Shopping Centers, a New York-based trade group.
Despite recent efforts to attract younger customers with the launch of the Kardashian Kollection designed by the reality TV sisters, the department store concept is outdated, said Sofos.
"Younger people are more into boutique shopping," she said. "As generations go, they get bored with what's there. Sears is a little dated not because of the people or quality of goods, but just because of the concept."
Waikiki resident Gene Daniels, 43, who was shopping at Sears Ala Moana Center Tuesday, said he shops at the store less frequently than he did 20 years ago because the quality has declined.
"It's gone down, even the quality of shirts ... even on their Craftsman Tools," he said. "I used to come about once a month. Now I come maybe twice to three times a year. If I want tools I'll go to Home Depot; clothes, usually Macy's."
John and Lesley Oku of Kaneohe, who were shopping Tuesday at Ala Moana with their three children, said Sears is their first stop whenever going to the mall.
It's where they buy their shoes and kids' clothes, get their tires fixed and car batteries changed, particularly because they trust the service and warranty.
"We're creatures of habit. We just always come here," Lesley Oku said. "My mom and dad came here. You just do what your parents did."
Nonetheless, times have changed, she said, and now there are a lot more options in the islands, which were once limited.
"People are less interested than before when the options were very minimal. It was Liberty House, Sears and J.C. Penney. Those were the three stores that everybody went to," she said. "Now there's so much more stuff for people. When you think Sears you just think ho-hum. It's just not as trendy."
Ala Moana shopper Dorian Newman, 23, said she can typically find the same merchandise at more convenient retail outlets.
Still, her mother, Sheri Newman, 50, of Ewa Beach, said another large retailer closing would be devastating to the local economy.
"It's horrible because of the number of people who will be put out of work on this island or statewide," Sheri Newman said. "Everybody's hurting in terms of job availability, and so for yet another big retailer to close is tragic. It just puts that many more people on the rolls of unemployment and that many more people out on the streets looking for a job and for ways to support their families."
Sears and Kmart were both retail pioneers. Sears, which started with a lone Minnesota watch seller in 1886, helped define the mail-order catalog industry, selling shoes, clothes, guns and even ready-to-assemble homes.
Kmart, which started as a five-and-dime in Detroit in 1899, once commanded a retail empire that included Waldenbooks, Borders, OfficeMax and Sports Authority before spinning them off. The big-box chain helped create the discount-store format that Walmart now dominates.
Associated Press and Bloomberg News contributed to this report.
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