Anger and Despair at Sears Canada

Christmas flyers are out—it’s time to hit the mall! Always a  shopping procrastinator, this year I decided to have an early start. So last weekend, we went to Sears, which as you might have heard, is closing.

Sears Canada is not having a dignified ending, rather it’s a dismal affair—the grand old store is embroiled in gossip, showing little goodwill, and displaying behavior that denies its glorious past.

There was lots of warning. Recently, bad press has swirled around Sears Canada. News that it was closing its subsidiary store, KMart, hit first, and then there was the bombshell that its top executives were leaving, always a bad sign.

In December of last year, Business Insider reported that Sears’ sales dropped from $41 billion in 2000 to $15 billion in 2015. During that same period, Kmart saw its sales decrease from $37 billion to $10 billion.

This year, things continued to unravel. Sears was granted court protection from creditors, and within months closed 59 stores across Canada, cutting approximately 2,900 jobs. July saw the start of discount sales, with prices slashed by 20 to 50 per cent. Then on Oct, 10, we learned that Sears was seeking court approval to liquidate.

Anger and despair in the aisles

This fall, hearing reports that about 12,000 people in total would lose their jobs, and learning they would lose their benefits, we wondered how workers were faring. Severance pay, it appeared, was out of the question, because Sears was insolvent.

Management was close-mouthed about the entire process, and workers were silent, fearing retribution. But accounts of their frustration and feelings of betrayal leaked through to the media.

“Now that Sears intends to close its doors,” a Sears Canada manager told reporter Sophia Harris (CBC News) in October, ” staff is devastated.”

“We’re really upset. It’s a very terrible Christmas present. There are people that lived this company. They don’t understand how this happened.”

Before we set out on our shopping excursion, we made sure we were prepared. But when we entered the store, it still was a shock. Business was brisk, and cashier line-ups were long. But it didn’t seem like a typical store closing, in which stock would dwindle until it was gone. Rather, stacks of boxes containing new merchandise were scattered throughout the aisles. It was a disorderly mess, with young, dazed staff working the tills. It looked like nobody cared, and no one was in charge. Thinking back to the Sears I knew all my life, it was a sad ending.

The way they were

I first knew Sears through its catalogues, when it was Simpsons-Sears, and at the top of its game. But before I was old enough to even turn the pages, Sears already had a long history. It originated as Simpson’s Limited, a department store in Toronto in 1872, partnering with Sears Roebuck of Chicago in 1952, to become Simpson’s-Sears, the new name for its successful mail order business.

The company expanded across Canada, building hundreds of stores, taking over the bankrupt T. Eaton company in 1999, and dominating the Canadian department store scene. Then, in 2009, during the economic downturn, it seemed to hit a snag, and slowly, but surely, began to spiral down.

There’s something rotten, at the core

Just as with every company that falls apart, there was an explanation. Stories of incompetence and mismanagement abounded. Rumor had it that CEOs were creaming off the profits, instead of investing in new ideas, Customers complained that the stock was uninspired—it was the same old stuff, recycled from rack to rack. Even the Christmas displays were dispirited, and dull.

It’s easy to lay the blame at the feet of those in charge. But looking a little deeper, you could see that management was not the only problem—rather, it seemed to be a sign of something gone bad in the world of retail.

A report in Fortune told the story: Other stores had also gone over the cliff—it read like something out of “Apocalypse Now”. National brands like J.C. Penney, Macy’s, Ralph Lauren and Staples started the year with dismal 2016 holiday season results. Their performance was instrumental in bringing the number of store closings in the US to 2,770 as of mid-May. Bankruptcies followed; chains like Limited, Payless, ShoeSource, and RadioShack.

As recently as 1999, department stores in the US had total sales of $230 billion. Last year they came in at $155.5 billion, according to Census data. All signs pointed to a grim future  of national retail department store chains.

Is this the end of department stores?

Don’t be misled, though. Shoppers are still shopping—retail spending in early 2017 rose 3.6% compared with the same period in 2016, according to Department of Commerce data. The National Retail Federation expects that growth to pick up even more, thanks to low unemployment and a strong stock market.

There is a shift, however, and it’s too big to be ignored:

1. One of the biggest shifts is shoppers’ move from expensive quality merchandise to discount prices. There is a constant, ruthless price war, pitting one retailer against another, and putting pressure on those just surviving.

2. Online shopping has steadily grown, shouldering brick and mortar outlets aside, and ending the need for massive store space in malls and megastores. Amazon is constantly improving its ordering and delivery services, offering instant gratification, with smartphones as shopping tools.

3. Consumers are developing fast-changing and wide-ranging tastes, which they can satisfy with a touch of their smart phones. Traditional gift shopping for Christmas seems to be falling from favor.

Yet some are optimistic

There are those in the retail industry, however, who refuse to accept that these trends may signal the end of department and big box retail stores.

Not to worry, says University of Essex professor and author of From Main Street to Mall, Vicki Howard—people were predicting the disappearance of department stores as early as the 1930s. But they’re still here, and will probably always be, she says.

Joel Bines, a managing director at consulting firm AlixPartners concurs, saying “Retail has gone through periods of creative destruction before.” (Fortune, June 15) In the end, he says, the companies left standing may emerge stronger than ever.

But current indications suggest that unless big-box department stores can shed decades-old habits, they may not have the relevancy to survive. Their dependable base of loyal, older customers are dwindling, and they are not attracting new ones.

As Steve Sadove, a former Saks Inc. CEO and Penney director, says, “The world is moving faster than the department stores are adapting.”

As I begin the holiday shopping season, I can’t help but wonder: Will this year mark the beginning of the end for department stores?

As one of the ‘older shoppers’, who has warm and fuzzy memories of department stores, I sincerely hope not.

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33 Responses to Anger and Despair at Sears Canada

  1. Growing up and getting the big, heavy Sears Catalogue in the mail each year, well before Christmas, was always a thrill. It was the “go-to” store for everything from school clothes to appliances to Christmas gifts. . . an always appreciated outing with my mom.

    The digitized world has its conveniences, but this is one more thing where I miss the face to face and like you, I have “warm and fuzzy memories” of Sears, Montgomery Ward and other department stores that have gone the way of the dodo.

    • Lynne Spreen says:

      Yes, me too! And I will always need a store to run in to at the last minute.

      • Still the Lucky Few says:

        Except last minute didn’t always work out. I think the department store was designed to snag you from one department to another!

    • Still the Lucky Few says:

      Although I’ve never worked at Sears, my first retail job was working at the Bay—the first in Edmonton, and the next in Calgary. Maybe it was my childhood experience with mail order, but I seemed to gravitate to department stores! Happy memories!

  2. Although I do some of my shopping online, there are items that I want to touch, inspect, and try on for size before buying. Maybe in the future we will be able to do these things virtually, but for now it requires a brick and mortar store. I also try to shop and buy locally whenever possible. So many jobs are being eliminated in the digital age and our government(s) aren’t addressing the carnage nor are they offering solutions.

    • Still the Lucky Few says:

      You are right…there is absolutely NO planning for the online world, as there isn’t for artificial intelligence. Seems we will all come to our senses when we are forced to!

  3. I remember when Sears catalog and Montgomery Ward were the only local choices for department store shopping in the small town nearest to my rural home. Later, Sears was always the place we went for appliances like washers, dryers, refrigerators, or vacuum cleaners. It’s sad to see Sears disappear. I like department stores. Like you, I wonder if by next Christmas, they will all be gone.

    • Still the Lucky Few says:

      Hmmm, quite sad, when you think it may be this close! Thinking back, Sears was the best place in town for appliances. We should have known something was afoot when they discontinued their repair shop!

  4. Aunt Beulah says:

    I, too, have warm and fuzzy memories of department stores. Living in a rural farming area as a child, I depended on the Sears catalogue, especially the Christmas edition. The small nearby town where we went to shop on occasion had a Penney’s store where I enjoyed watching the clerk put her handwritten bill and Mom’s money in a container which whooshed away along wires to the cashier on the second level, who then returned change and a receipt. It seemed like magic. Thanks for reviving my memories, Diane. I, too, hope department stores never go away. I like seeing and feeling what I’m buying.

    • Rachel McAlpine says:

      Janet, I remember a holiday job as a cashier putting change into those little capsules, whacking open the lid on the end of the pipe and sending the change back through the tubes. Whee! Diane, your article was spot on, including the reasons for the decline of live shopping. Our long-lived department store closed recently, was replaced by an Australian one which is lavish but lonely.

    • Still the Lucky Few says:

      I remember the tube that transported bills and cash to some unseen place, to be counted and recorded, no doubt. What a memory jog! The Sears catalogue used to be called the Wish Book, although that evolved in later years.

      • I worked in the 1960s in dept stores in the UK and one in particular I worked where the green and red capsules came to a certain clearing area, it was always a hoot when a black or white came, as often it was backed up and took us a while to shoot it off again..wondering how the customer was fairing on which ever floor they were on “waiting”

  5. Funny when you think about it. Sears was first and foremost a mail order company. Not so different from ordering on line, right? People will always want to buy something and the demise of the brick and mortar stores will only lead to the next best way to spend our hard earned dollars. Progress? I wonder…

    • Still the Lucky Few says:

      My mother bought everything through the catalogue—even shoes! I remember, she used to trace our feet to measure for shoes, but I also remember they didn’t always fit comfortably!

  6. Sears catalogues were a huge part of Christmas dreams and fantasies in my childhood. As an adult I shopped through the catalogue when we lived in realtively isolated places. But by the late 70s the items I purchased began to be of very poor quality, the stitching on children’s clothing unravelled at the first washing, sizes did not necessarily fit as expected, towels were like cheesecloth, furniture was poorly made and uncomfortable… the final blow for me was when they sold me a maintenance agreement for an appliance, with the stated advantage that if we didn’t use it the funds would be refunded. We didn’t use it, the funds were only available as a certificate which had to be spent within 90 days at Sears. When I told the representative that we had been told we would receive the money, she snarkily responded, “you should have read the fine print”. More fool me. We never purchased another item from Sears after that. I feel for the staff, but the company, as it had degenerated, wasn’t worth saving, in my opinion.

    • Still the Lucky Few says:

      I agree, Sears did go downhill. However, I can’t say that I continued to use the mail order services after the 1960s. My disappointment with Sears basically centered around the removal of their repair shop, which I depended on to keep my appliances in order. I’m not surprised to hear of your experience, though!

  7. I still have warm fuzzy feelings about Sears and Montgomery Wards catalogs. We didn’t have their retail stores here in our town, so just places where we could return items that we didn’t like or didn’t fit and needed to be exchanged. Returns were free, so it was a good system.

    • Still the Lucky Few says:

      I felt that their mail order services were great during the 1950s and 1960s. However, since I moved to the city after that, I preferred to shop in the actual stores. I also worked (and shopped) at the Bay. I loved that store, and am happy to say that so far, it has survived!

  8. I’m in New Zealand, our biggest iconic department store was Farmers with a flagship store in Auckland – where to save the trip up the hill they ran a trolley bus – it was around 6 floors with a glorified cafeteria with children’s playground on the top floor overlooking the harbour.

    Then it went down with a bang and now that same building is a hotel…

    Many of the outlaying stores closed, now there are only a few here and there, mostly in Malls. And their essence has certainly changed.

    A number of other flagship type of stores fell off the retail square…some reopened as much smaller entities, I think of Whitcouls on Queen Street, a book/gift sort of store on 3 floors – it’s gone to a smaller entity in the laneway that was adjacent to them. And in their old store is a new revamped Farmers…

    So many other dedicated retail stores have opened – along with stores that import from other places in the world – cheap $1,2,3 type store.

    I think also the Internet has a huge part in their demise, but maybe it was also the dedicated to “one type of product” store that really nailed it down.

    • Still the Lucky Few says:

      I think that retail (especially the department store) is really at risk right now, world-wide. Thanks for adding your perspective from New Zealand!

  9. Joe Wasylyk says:

    What will people say when Walmart has a closeout sale? It looks like we will have more specialized stand alone retail stores and of course Internet retail sales will also be strong.

  10. Irene Waters says:

    Your post has come as a shock to me. We have had some department stores go but over the years. Sears and Kmart are institutions that you don’t expect to flounder. I have to admit I rarely go to a department store and a lot of our shopping is done online. I guess it is the growing trend.

  11. OK madam: more about the money tubes — though not at Sears. Your post, and some of the comments, inspired me to write a poem about that other-worldly role. I’ve posted it on aybrow.com — enjoy, and thank you.

  12. Rummuser says:

    Organisations are also organic. They get born, grow, plateau and then decline. The only way this can be stopped from happening is to innovate before the plateauing starts to take place with new ways of doing business through many strategies. The long surviving companies have all done this and those that did not have all perished.

    Here in India, when the big retailers came, they also brought along the likes of Amazon in to the country. The small mom and pop stores innovated by streamlining their inventory, started home delivery and credit sales and have succeeded very successfully. And funnily enough, some of the big retailers have succeeded in closing down their competitors and the etailers have also done this through acquisitions.

    That is capitalism – Suvival of the best.

    • Still the Lucky Few says:

      Thanks for your mini-course on the rise and fall of business enterprises. Using the term, ‘organic’ helps us to understand it better. Adapt or die, they also say!

  13. joared says:

    I recall the pneumatic tubes at J.C.Penny store when I was a child — their swoosh to and from some mysterious place with our purchase payment, then change returned, fascinated me. The whole idea is proposed for a Hyperloop here in the Los Angeles, Calif. area to transport people now, per Elon Musk of Tesla auto maker fame:
    https://www.forbes.com/sites/alanohnsman/2017/04/06/hyperloop-one-finds-u-s-clamoring-for-vacuum-tube-trains-next-stop-make-them-real/#1119151078b3

    Sorry you’re losing your Sears. Don’t know if ours is closing. Our Monkee Ward’s closed years ago. I always got a big Sears catalog every year they had one. Of course the tale was told years earlier the family farms of my mother’s youth that had no house indoor plumbing used the pages of their old catalogs in their outhouses for personal care.

    Sears holiday catalog I heard was to be released this year:
    https://www.cnbc.com/2017/10/25/sears-is-bringing-back-its-iconic-holiday-catalog.html

    Recently heard Sears would stop carrying appliances we often used which was disappointing — also would miss their repair service.

    A KMart in our area was closed many years ago when I think I recall hearing the chain was having financial difficulty — seems Debbie Reynolds was a big investor they mentioned if I remember, but not sure now.

    • Still the Lucky Few says:

      Who would have thought pneumatic tubes would have a re-birth in our modern world! No end to Musk’s innovations! I believe Sears is in the process of downsizing its involvement in the USA also. And yes, I’ve heard about the alternate use for Sears’ pages—nothing wasted in those days! Although our own Sears, here in Victoria, is staggering towards a sure end, we still go there to check it out from time to time.

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