Sears Holdings announced the closure of yet another 72 underperforming stores. The news comes on the heels of the flailing company once again reporting a net loss of $424 million for the first quarter, with comparable sales down almost 12%.
And revenues were down significantly from the previous quarter, almost reaching $3 billion, compared with $42 billion in the quarter prior, due in large part to store closings.
The Sears team has identified 100 underperforming stores, of which 72 locations will be announcing closure in the coming 24 hours.
CEO and Chairman Edward Lampert did try and highlight some of the positive aspects of the quarter, such as the company’s new partnership with Amazon for tires and the expansion of its online Lease It program.
Mark Hamrick, senior economic analyst from Bankrate.com, said the closures could have an impact on some smaller communities where the closures are taking place.
“As more stores go vacant, more employees are thrown out of work and more real estate inside malls is freed up,” Hamrick said. “For mall owners and operators, that Sears is close to being on-life support doesn’t come as a surprise. Only the timing and details are coming closer into view. It further demonstrates the urgency for malls to transform their offerings to include more experiences, such as dining options as well as more services, in order to survive and even thrive.”
Still, Hamrick described the demise of Sears as prolonged and slow, as evidenced by quarterly sales numbers.
“Essentially, it has been injury by a thousand cuts, whether by failing to staff stores to provide customers with good experiences or by failing to stock better quality merchandise in its stores. Go inside a store now and you might find messy shelves and few staffers available to help or check-out,” he said.
And the company is contributing to its own decimation. Hamrick noted that as Sears diminishes the quality of the in-store experience, consumers are less likely to want to go inside. And brands—take Craftsman, for instance—are pulling their partnerships literally from the shelves.