Sears is threatening to leave its headquarters in Hoffman Estates, a suburb of Chicago. At the time it left the Sears Tower, the company received incentives from the state to remain in Illinois, and built a sprawling office complex that was, in suburban fashion, as the iconic tower it abandoned in 1993. Now Sears is playing the "move" game again, seeking generous payouts from states to relocate its operations.
It is hard not to look at this and be a little cynical. In 1993 Sears was fading but still relevant to the retail world. The chain was once the nation's top-ranked retailer at a time when Kmart was the top-ranked discount retailer. In 2011 these combined companies rank number ten. Sales have declined for 19 straight quarters and stock prices have declined despite desperate buy-backs meant to inflate value. Sears is not wanting to relocate, it is looking for cash in order to survive.
So as a state or city, is it worth bidding on this dying dinosaur? Some states think so. Ohio, for one, has offered $400 million. On the other hand, Illinois has chosen not to get into the game by offering any incentive to stay. This might have been Sears' ultimate hope - a package of concessions without the cost of relocation.
I wonder what the real benefit might be to any place that lands a relocated Sears. How many employees will transfer with the company? For many, this may be an opportunity to jump ship. If the best executives, middle management, and technical people refuse to depart with the company, how much sooner will Sears enter the ranks of the departed? Can a company with no clear, effective direction absorb the turmoil of a move and restaffing without taking a hit, which in this case might easily be a death blow?
Is there merit to playing the incentive game, or is Sears just waiting to expire?