Sears Holdings Corp (NYSE:SHLD) announced that it will permanently shutter even more of its Sears and Kmart locations, two of its flagship subsidiaries. The early November announcement comes after a record number of traditional brick-and-mortar stores have closed in 2017. It’s been an especially hard year on Sears and Kmart, which have seen 358 of their locations close in 2017.
As it stands, 2018 looks like it will be a miserable year for the American retail landscape as well.
Stores Closing in January 2018: 18 Sears and 45 Kmart Underperforming Stores
Sears Holdings said it will cut loose 63 more underperforming Kmart and Sears locations in January 2018, as the weary retailer looks to cut costs and rebuild its tarnished brand. Store employees were notified about the closure on Thursday, November 2 and will be eligible for severance pay. The company also said liquidation sales will begin as early as Thursday, November 9.
Sears once dominated the American retail landscape with popular brands, including “Craftsman,” “Black” and “Decker,” and “Whirlpool.” But the company has been struggling for years. Analysts say that it needs to raise $1.5 billion annually just to keep its operations going. Since 2011, Sears Holdings has lost close to $10.5 billion.
While the writing has been on the wall for Sears Holdings for years, the dire outlook for the company came into focus in March, when it raised doubts about its ability to keep operating after seven years of mounting losses.
Since that warning, it’s been a bloodbath at both Kmart and Sears.
November, December 2017 Store Closures: 28 Kmart Stores Close on Q2 Losses
In August, Sears Holdings announced it was closing 28 Kmart stores. The struggling department store chain announced the additional stores slated to be shuttered after it reported weak second-quarter results.
The November and December Kmart store closures are happening across the country, with closings in Arizona (one), California (five), Colorado (two), Connecticut (one), Florida (one), Georgia (one), Illinois (three), Kansas (one), Michigan (three), New Jersey (two), New York (three), Ohio (one), Oregon (one), Pennsylvania (two), Rhode Island (one), and South Carolina (one).
In August, Sears Holdings announced that second-quarter revenue tumbled 22% year-over-year to $4.4 billion. Comparable-store sales fell 11.5%. Comparable Kmart stores were down 9.4% and comparable Sears store sales declined 13.2%.
The company’s net loss narrowed to $251.0 million, or $2.34 per share. In the second quarter of 2016, the net loss was $395.0 million, or $3.70 per share.
October 2017 Store Closures: 35 Kmart and 8 Sears Close to Focus on Online Sales
In July, Sears Holdings announced plans to close 43 retail stores: 35 Kmart and 8 Sears locations. While the American department store chain still has more than 1,000 locations, it has been closing locations at a steady rate as it fails to compete with online competitors.
“We have fought hard for many years to return unprofitable stores to a competitive position and to preserve jobs and, as a result, we had to absorb corresponding losses in the process,” said Sears CEO Eddie Lampert.
September 2017 Store Closures: 34 Sears, 51 Kmart’s, and 7 Sears Auto Centers
Sears said it was planning to close an additional 72 stores in September, this in addition to the 180 locations it had already announced would close in 2017. The company said it will close stores in three different units of Sears Holdings: 16 Sears locations, 49 Kmart stores, and seven Sears Auto Centers.
Those weren’t the only September closings announced. In June, Sears Holdings also announced plans to close an additional 20 outlets, including 18 Sears locations and two Kmart stores.
July Store Closures: 12 Sears and 18 Kmart Locations Close Due to Competition from Amazon
Sears Holdings quietly added 30 stores to its list of store closures, including 12 Sears locations and 18 Kmartones. At the start of the year, the company said it would close 150 stores, but that number has been steadily rising, often without any formal announcement.
“At the beginning of the year we said we would continue to strategically and aggressively evaluate our store space and productivity, and accelerate the closing of some unprofitable stores,’’ said Sears Holdings spokesman Howard Riefs.
When Sears Holdings reported quarterly results in March, it noted, “that we will continue to accelerate our focus on our best stores, best categories and best members.’’
Many thought the store closures would create an opportunity for other chains to pick up the market share. But thanks to the growing popularity of online stores like Amazon.com, Inc. (NASDAQ:AMZN), chances are good it will snap up the majority of the share.
Stores Closed in April 2017: 50 Sears Auto Centers and 92 Kmart Pharmacies
To help cut costs, Sears Holdings announced in April its plans to close 50 Sears Auto Center locations and a whopping 92 underperforming Kmart pharmacies to help cut costs by $1.25 billion in 2017.
Up to this point, closures and other initiatives helped Sears Holdings find $700.0 million in annual savings. Closing the 142 additional locations was expected to help the company reach its $1.25-billion cost-cutting goal.
The frazzled retailer did not give a timeline though for the store closures. Nor did Sears Holdings provide a list of which locations were scheduled to close.
January 2017 Store Closures: 109 Kmart and 41 Sears Store Close After Disappointing Holiday Sales
Sears Holdings kicked off 2017 with a bang, announcing 150 store closures:–109 Kmart locations and 41 Sears stores. The company did not, however, say how many employees would be laid off.
A spokesperson did say that most of them were part-time workers and that, “we are committed to treating these associates with respect and compassion during this process.”
It was a big shakeup for Sears. In 2016, it only closed 78 stores, and in 2015, more than 200. But as consumers found out as 2017 progressed, the 150 store closures were only the beginning.
Lampert said of the store closures that Sears Holdings is, “taking strong, decisive actions…to stabilize the company and improve our financial flexibility in what remains a challenging retail environment.”
The 150 stores being shuttered collectively reported annual sales of $1.2 billion. They also lost about $60.0 million.
“Many of these stores have struggled with their financial performance for years and we have kept them open to maintain local jobs and in the hopes that they would turn around,” Lampert added.
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