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IN THE NEWS: Sears Closures (a tale of transformation?)

On Thursday, April 21, 2016 Sears Holdings announced “it will close 68 Kmart and 10 Sears stores this summer in its latest move to cut losses.” (http://www.wfaa.com/money/78-sears-kmart-stores-to-close-see-the-list/147799701)

Folks, the only question we should be asking is why are these “anchor” type stores (the big ones at the mall) closing when the economy is doing better and gasoline prices are relatively cheap?

Think about this: When gas prices are low people have more money in their pockets that can be used to spend at places like Sears. Overall, the economy appears to be moving in a positive direction.

The U.S.Gross Domestic Product (GDP) grew 1.4 percent in the 4th Quarter of 2015 while positive is a slower pace than the 2.0 percent in the previous quarter. (http://www.bea.gov/newsreleases/glance.htm)

Heck, even real disposable personal income increased 0.3 percent in February 2016. No matter how you look at things, positive growth is still positive growth.

Realistically, I know all this can change on a dime but for now things are poised for a pretty good year. Also, I am not part of the Sears Holdings inner circle and will almost never know what the real reason may be for the closures. That’s alright, all this speculation is pretty good.

Also what exactly what kind of “transformation” is needed to make the organization “profitable”? Unless the organization is planning to open more specialized (niche) stores, doing the same old thing (only less of it) is NOT going to cut it.