By William Davis
Forgotten, perhaps, in all the sturm and drang surrounding last week’s market meltdown, the great American economy continued to chug along. Companies made things. Customers bought things. Big brown trucks delivered things. Amazon, for its outsized part, catalogued more than $3 billion in sales. Walmart pushed out nearly $2 billion worth of consumer goods. So, too, somehow, did Home Depot. Sears, meanwhile, sold three truck tires, two gallons of paint, and a pair of Garanimals pajamas for girls. Sears…where America used to shop.
1886: Richard W. Sears launches the R.W. Sears Watch Company in Minneapolis, advertising his company by mailing catalogs of his watches to businessmen. Alvah Roebuck joined up in 1895.
In these days of Amazon, it’s hard to believe that it was Sears that pioneered the strategy of selling everything to everyone. Indeed, a century before Jeff Bezos started shipping books out of his garage, Richard and Alvah built a catalog business that sold Americans the latest dresses, toys, build-it-yourself houses, even tombstones. In their heyday, the boy’s stores, which began to spread across the country in the early 20th century, were showcases for must-have washing machines, snow tires, and furniture. Who knew that mail was an internet before the Internet?
1913: The Kenmore brand launches, first as a line of sewing machines.
Today, the really, really sad story that is America’s original “Everything Store” is one or two product returns away from disappearing from this country’s business – and cultural – landscape altogether. The company that gave rise to now-famous brands like Whirlpool, Schwinn, and Allstate, is limping into bankruptcy. At this unhappy hour, with a $134 million credit payment due and no cash in its dusty registers, the former retail titan has filed for Chapter 11 protection to at least keep operating at least through the holidays. Because even bankers know that Santa prefers Craftsman table saws.
1925: Sears opens its first retail store in Chicago, showcasing items from the catalog. The Craftsman line of tools is introduced.
1962: Target, Kmart, and Walmart are founded.
If you’ve forgotten…or never knew…Sears was once a retail innovator. But the firm was doomed to lose its place on the mantle, first to big box retailers like Walmart, Target, and Home Depot, and then to Amazon, as the go-to shopping destinations for baby clothes, hedge trimmers, and garage door openers. Just a decade ago, the company employed 300,000 folks, serving customers who would actually wait in line for their store to open. Today, there are less than 70,000 mostly uninterested employees sluffing around clearance sales, empty shelves, and handwritten signs. Hey…can I get some help here? Uhhh, no?
1991: Walmart overtakes Sears as the nation’s largest retailer.
Since 2005, Sears Holding Company has been run by a former hedge fund manager named Eddie Lampert. As Sears’ CEO, President, and Head Parking Lot Attendant, Eddie — with no previous retail experience — has systematically stripped out the company’s valuable properties and brands while his hedge fund lays claim to the real estate that will be left over. To the competition’s delight, the Lampert team, following its ill-fated mashup of Sears and Kmart, has never developed anything that even remotely resembled a winning retail strategy. To quote: “We will not spend money on capital expenditures to build new stores or upgrade our existing base simply because our competitors do.” Wow. Mall owners around the country couldn’t be less thrilled.
As the reorganization plan moves grudgingly forward, Sears will receive $1.875 billion in bankruptcy financing to help keep its shelves stocked and employees paid. The company will also close another 150 or so stores – sadly returning to its numerical presence in 1929 – as it tries to reduce costs and find some way forward. Remaining assets like the Kenmore appliance brand and the Sears Auto Centers will likely be sold, probably to some friend of Eddie.
1993: More than a century after launching the catalog, Sears end its production.
No other large retailer has endured as long or played as important a role in American life as Sears. Heck, Sears was the first major chain to build parking lots! Today, the company’s saying it can reorganize around roughly 300 of its most profitable stores. Maybe. But probably not. The “gales of creative destruction” are blowing particularly hard these days, and they’re heading right for Richard and Alvah’s namesake.