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Thread: Sears + Kmart = ????

  1. #1
    Cyburbian Cardinal's avatar
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    Sears + Kmart = ????

    I am surprised this was not posted earlier, but what does Cyburbia think of last week's announcement that Kmart will buy Sears? To me, this seems like the perfect marriage of poor quality with poor merchandising. With the best minds of both companies working in concert, I give the new company four years before the curtain falls.

    In the more immediate time frame I expect we will see some changes. Will Sears move out of the mall and into what are now Kmart stores? They have already launched the "Sears Grande" format. What can we expect from Kmart? They appear to be unenthusiastic about combining groceries and general merchandise. Will they trend more toward Seas' model? When Target Corp is shedding its mall stores (Daytons, etc.) why would Kmart move the other direction? The ultimate question: can anything really save these retail dinosaurs, or will we all be dealing with large redevelopment sites in the future?
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  2. #2
    Cyburbian el Guapo's avatar
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    Suck + Suck = Suck+

    I would compare it to two mildly retarded cousins getting married. Sure there is every chance the children will be normal, maybe even exceptional. But we all know they are likely to be even bigger tards.

  3. #3
          roger's avatar
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    Given the recent track record of mergers of this sort, I'm maintaining a healthy dose of skepticism. Although it might work in a suburban niche, especially with Sears' emphasis on tools. I do love their tool department!

  4. #4
    Cyburbian The One's avatar
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    Yup

    Quote Originally posted by el Guapo
    Suck + Suck = Suck+

    I would compare it to two mildly retarded cousins getting married. Sure there is every chance the children will be normal, maybe even exceptional. But we all know they are likely to be even bigger tards.
    Me thinks EG is right on the nose with his eloquent description of this tomfoolery....
    Skilled Adoxographer

  5. #5
    Cyburbian Masswich's avatar
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    Now I am the market-based realist?!?!

    Geez, guys, I know planners are trained to hate chain retail, but give me a break! Not everyone can afford to buy upscale merchandise, and while Target is generally a better store, isn't it nice to have some competition? And Sears' tool department is one of the best around (better than Home Depot, that's for sure).

    I do think that KMart has been getting better in terms of the quality of the merchandise. Now maybe they will actually be able to stock everything instead of having big piles.

    On the whole I think the merger is a good idea. Neither one of these places can take on Target on their own- and while I don't know much about Wal-Mart except that I see a lot of them when I leave my urban bubble, I think that Wal-Mart is cleaning KMarts' clock out there beyond the urban growth line- so the merger can only help KMart compete, and make Wal-mart a better store for having the competition.

  6. #6
    Cyburbian Breed's avatar
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    Quote Originally posted by Masswich
    Geez, guys, I know planners are trained to hate chain retail, but give me a break! Not everyone can afford to buy upscale merchandise, and while Target is generally a better store, isn't it nice to have some competition? And Sears' tool department is one of the best around (better than Home Depot, that's for sure).

    I do think that KMart has been getting better in terms of the quality of the merchandise. Now maybe they will actually be able to stock everything instead of having big piles.

    On the whole I think the merger is a good idea. Neither one of these places can take on Target on their own- and while I don't know much about Wal-Mart except that I see a lot of them when I leave my urban bubble, I think that Wal-Mart is cleaning KMarts' clock out there beyond the urban growth line- so the merger can only help KMart compete, and make Wal-mart a better store for having the competition.
    I don't think the commetary is necessarily anti-chain... it's just that K-Mart and Sears have been so bad for so long that it doesn't bode well for future expectations. While taking two failing companies and making them one big company might make them better, it could also turn out to be a colossal disaster. Think of it this way in terms fo the proverbial lemonade stand... Competition's great... but Sears and K-Mart haven't been competition-worthy in two decades.

    Think of it this way...
    One lemonade stand spits in every glass of lemonade stand they make... and another pours it over your head... and now they merge... do you really expect them to compete with lemonade stands that make good lemonade?
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  7. #7
    moderator in moderation Suburb Repairman's avatar
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    The merger is good for both of the companies involved, but not good enough. I mean hell, when I think of Kmart I think of Ray from Rain Man saying "Kmart sucks". When the dust clears away Walmart will still be kicking their ass.

    Sears has superior tools to most, but does a **** job of marketing that aspect. They also have a good appliance selection. I think part of the problem is they are not attracting new clientelle. There are people my age that have never been inside a Sears. They could use a little rebranding and a new identity.

    eG's assessment made me laugh. This really is a case of kissing cousins. I think it would have been funnier if Walmart was buying Sears so we could crack a bunch of Arkansas hillbilly jokes (apologies to Arkies)!

    "Oh, that is all well and good, but, voice or no voice, the people can always be brought to the bidding of the leaders. That is easy. All you have to do is tell them they are being attacked and denounce the pacifists for lack of patriotism and exposing the country to danger. It works the same way in any country."

    - Herman Göring at the Nuremburg trials (thoughts on democracy)

  8. #8
    Cyburbian jordanb's avatar
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    Sears has been on the rocks ever since they moved to Hoffman Estates so their CEO would have a short commute and thereby caused their entire headquarters staff to turn over in the course of a few years. Moral: don't screw your employees over in the midst of an economic recovery, because they will leave.

    When has K-Mart not been on the rocks?

    It's like two drowning men trying to cling to eachother to stay above water.

  9. #9
    Cyburbian el Guapo's avatar
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    Like Marion Barry to Crack am I to Wally World. I love it even thought I know it is bad for me. But K-Mart and Sears? Please Planner. When I want a prozac experience I go look at K-mart. Its like shoping in the USSR circa 1989. When I want an uninspiring mall experience I go to Sears. Blahhh city.

  10. #10

    Walmart + Kmart= World Take Over

    All I have to say is that maybe Kmart and Walmart can join with oneanother and then take over the goverment so that we can get Bush out of office. Any one want to sign on?

  11. #11
    Cyburbian jordanb's avatar
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    Why on earth would Wal-mart want Bush out of office?

  12. #12
    Cyburbian
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    Let's see, bankrupt company takes over nearly bankrupt company that recently sold off its major asset its credit card for the owners largesse. I see further consolidation as head to head stores are closed. Walmart and Home Depot taking over prime locations, AKA Walmart enters the urban market, and the new Sears Holding folding up shop within 5 years.

    I wonder if the CEO's are actually working to help Walmart?
    Planning is much like acting, as my old theater professor used to say, "If you sin, sin boldly, only you know if you are ad libbing." I follow this adage almost daily.

  13. #13

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    Quote Originally posted by el Guapo
    Like Marion Barry to Crack am I to Wally World. I love it even thought I know it is bad for me. But K-Mart and Sears? Please Planner. When I want a prozac experience I go look at K-mart. Its like shoping in the USSR circa 1989. When I want an uninspiring mall experience I go to Sears. Blahhh city.
    Exactly. What can Sears/KMart do that Wal-Mart, Target, Sam's Club, Costco, or high-end department stores do already?

    Sears and KMart -- buh-bye.

  14. #14
    Cyburbian Mud Princess's avatar
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    Quote Originally posted by Cardinal
    I am surprised this was not posted earlier, but what does Cyburbia think of last week's announcement that Kmart will buy Sears? To me, this seems like the perfect marriage of poor quality with poor merchandising. With the best minds of both companies working in concert, I give the new company four years before the curtain falls.
    <sigh> I have to agree. Who will be left to compete with Wal-Mart? Thank God we still have Target. In my adult life we have lost so many general merchandisers and department stores: Caldor, Bradlees, Ames, Woolworth, Gimbels, Korvettes...

  15. #15

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    Location, Location, Location!

    It's not about retailing; it's about real estate.

    Most K-Marts are "big-box" style free-standing locations; Sears' locations are anchors to regional malls.

    The merger gives Sears a foothold in those free-standing venues (they actually had bought some store sites from K-Mart) which will allow them to exit the malls which in my neck of the woods, are diappearing fast.

    I doubt this new alignment will enable them to be a serious contender to Target, Wal-Mart, et.al.; they'll just be a vehicle to accomodate huge fortunes to be made on their real estate assets.

  16. #16

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    I guess I am a specialty shopper who just walks through past all of the other stuff without even looking: but there is no reasonable substitute for Sears when it comes to buying tools and appliances of a good quality at a reasonable price. And our local Sears is packed every weekend - though maybe not in the clothing aisles. It seems to me that this merger might have some potential IF they can focus on their strengths. If they try to go head to head with Wal-Mart or Target, they are dead of course, but it seems to me that they have some other choices.

  17. #17
    Cyburbian Man With a Plan's avatar
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    What does all this mean to the planning world?

    I'm sure Searsmart is one of the largest property-owners in the US. What impacts will this have on the urban/suburban/soon to be sprawl landscape?

  18. #18
    Cyburbian Cardinal's avatar
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    I am surprised to hear so many people rave about Sears' tools. It used to be true that a Craftsman tool was an exceptional product warranted for life. Now, only their top-of-the-line tools come with a warranty. Look closely at the Ryobi power tool you can buy at Home Depot and then at the Craftsman you can buy for 10% more at Sears. Other than the name, they are the same tool. The same is true of some of their appliances. I think it is Whirlpool that is making some products with a Kenmore name.

    As for real estate, Kmart does have many locations in older urban areas, which it might be able to leverage into a means of competing. But that competition is right now only based on proximity, not on merchandise or convenience. The Kmart locations tend to be older stores in strip centers. There is a great deal of renovation that will be necessary to keep them competitive as not just Wal-Mart and Target, but Best Buy, Linens 'N Things, Office Depot, Old Navy, and other niche retailers find infill and redevelopment sites and pick off business.
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  19. #19
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    Sears took a successful approach a few years ago that its competitors are just beginning to follow... Sears opened (and kept) stores in under-served urban locations. Many of these stores have some of the highest sales in the chain. They also marketed and stocked the stores for urbanites.

    Some of their urban stores:
    Oakland
    Bronx
    Queens
    Brooklyn
    Downtown Chicago
    Chicago inner city neighborhoods
    East Los Angeles (Boyle Heights)

    If this new company does die, I hope someone will pick up these urban locations and the Craftsman and Kenmore lines.

    Has anyone seen Sears Canada? They bought out the Eaton's chain a few years ago and those stores are very upscale. The store in Downtown Vancouver is very nice and I thought was almost nicer than a Macy's in the states. They have a restaurant, higher quality merchandise but also carry the Sears brands. And they still have the famous Sears catalog.

  20. #20
    Cyburbian Emeritus Chet's avatar
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    Time will tell. The merger is an interesting survival strategy, and was actually not unexpected according to some industry sources I have tlaked to. Now it is just a matter of branding and identify, quality, locations, and price points.

  21. #21
    Cyburbian Emeritus Bear Up North's avatar
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    This Bear thinks the marriage will work.

    The prime real estate that K-Mart has, usually in low-cost long-term leases, will give Sears some good locations. Sears has many stand-alone stores and will shove in the few K-Mart brands that mean something (Martha Stewart's Prisonwear, for example).

    They will improve their purchasing power and lower overhead costs. Those reduced overhead costs will be enhanced by eliminating over-lapping distribution centers, reducing their freight costs along the way.

    Sadly for American manufacturers, it will probably also enhance their clout with China, etc., improving the negotiations at the costing table.

    Look for ad agencies to join the fray, trying to push a "new image" of the combined companies.

    It won't be an easy road and there will be miss-steps.

    Bear In the Tool Department
    Occupy Cyburbia!

  22. #22
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    I was happy to hear about the merger. Though I am typically against mergers, I think anything that has a chance of fighting Walmart is good. Now, realistically, I don't think this combined chain will succeed (and the alliance seems an odd one) but one can hope. And maybe if the new company in turn merges with another giant... Personally I always liked KMart OK (better than Walmart, anyway). Then again, I both shopped and worked at Bradless and Service Merchandise!

  23. #23
    Forums Administrator & Gallery Moderator NHPlanner's avatar
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    From the Onion:

    The Kmart-Sears Merger
    "It's about time a serious heavyweight challenged Wal-Mart's position as the most depressing place on earth."
    —Etta Newkirk, Radiation Therapist
    "Growth is inevitable and desirable, but destruction of community character is not. The question is not whether your part of the world is going to change. The question is how." -- Edward T. McMahon, The Conservation Fund

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