business news in context, analysis with attitude

The New York Times this morning has a story - one might almost call it a pre-obituary - about Sears Holdings, "which is projected to lose more than $2 billion this year" and appears to be "in the retailing dead pool."

The Times writes that "as its prospects for a turnaround appear to grow dimmer, it may seem to be another morality tale for bricks-and-mortar retailers in the age of Amazon. Yet it is a lesson that even Sears recognizes. Like other retailers, the company is scrambling to adapt to today’s internet market. The question is whether it can do so before its cash runs out and the deal-making of its hedge fund chief executive, Edward S. Lampert is not enough to create more."

The real problem, the Times writes, is that "it is not Amazon that is primarily to blame for Sears’s plight. Sears is being squeezed by changing economies and technology. Shoppers go to Walmart for discount items or to Target for discount items with a touch of style. The high end stays at stores like Nordstrom. The middle is smaller and increasingly shops online."
KC's View:
The company seems utterly uncertain of its strategy, and customers that should be in its sweet spot seem equally uncertain about what the retailer stands for; while Lampert is fond of saying that traditional retailers get held to a different standard than internet companies, the time is long past for whining. As the Times story makes clear, Lampert has led the retailer with all the marketing and merchandising acumen that one would expect from a hedge fund manager.

The fact is that Sears largely is an analog company drowning in a rising digital ocean. For the most part, it has long seemed as if nobody at the top knows how to swim.