Sears Holdings Corporation I. Company Overview Sears Holdings is a relatively new company, having only been created in November of 2004 (Barbash & Barbaro, 2004). At that time, Kmart Holdings purchased Sears, Roebuck, and Co. The corporation decided it would operate stores under both names, and the merger was officially completed in March of 2005. The shareholders voted to close the deal, or it would not have been able to take place. Now the company is called Sears Holdings, and it operates both Sears and Kmart stores (Barbash & Barbaro, 2004). The company also markets both brands without blending them or favoring one over the other. There were several reasons why the companies chose to combine. One of the main reasons Sears and Kmart merged was that Sears had started investing in stores that were free-standing and not located in malls. These stores were larger, newer, and called Sears Grand. Sears then purchased a large number of Super Kmart stores earlier in 2004, which made it much easier for the merger to be completed (Barbash & Barbaro, 2004). The process was accelerated by the number of stores the companies already owned, and was not as complicated or time consuming as a merger of companies that were not in any way related to one another or where there was no cross-store ownership. There were also proprietary brands that were held by both Kmart and Sears, and with the merger it would be easier to get those brands out to the target demographics. Making each
Sears, Roebuck and Co began in the 19th century and sold farm supplies and consumer items as a small mail order company. The first Sears retail store opened up in Chicago on the 2nd February 1925 in the building named the Merchandise. This store had included a soda fountain and an optical shop. The first detached and separate retail store opened up on the 5th October 1925 in a city called Evansville in Indiana. During the summer season in 1928 3 more Chicago department stores opened newly, one on the 63rd and Western a second on the south side at Kenwood and 77th, and the third at north side at Lawrence and Winchester Street. In 1929
Walmart was started on a large visionary change. Sam Walton, the founder, started Walmart when no other stores existed like the Walmart we know and appreciate today as consumers. The company was founded on a change. Walmart was created to change how retail worked and no other retail store had yet offered lower prices with great service like walmart was created to aim towards. As Walmart is approached with a merger of BIGGER Company, Inc., there is a specific process that needs to be followed to make for a successful culture change in the organization. Before any specific approaches are used to create the merge, it needs to be established that the leaders of the company play a very vital role in the change. Next, the start of the change needs to start with one of the three layers of organizational culture. The company needs to focus on the organizational culture layer that plays an important role with Walmart as an already established company because it is very important to consider how the current culture is is aligned with the set in place vision the company has (Kreitner 73). This structured change approach is inevitable to have a more simple change for a merger and an easier change to the company 's existing culture. After the culture and any issues that exist are acknowledged, it is time for the company to move on with the merging process. The merging companies need to exchange the beliefs and norms that are preferred by
90) As the battle to maintain leadership wages against Ralph the greed of others constantly causes hurdles in the separate battle for survival. Greed is an everyday struggle in the real world and can be seen when Sears purchased Kmart in an effort to make more money by reviving a struggling business. This attempt by Sears prompted the collapse of their entire corporation and it is still struggling today. The New York TImes explained “Five years after the merger, Sears Holdings is beleaguered, with sales markedly worse than its competitors’.” This is proof of the negative effects that greed had on a real world situation.
Robert J. Samuelson in, “Why are Macy’s and Sears in Distress,” exhibits a very dedicated and thoughtful tone. He begins the article explaining what Macy’s and Sear planned to so to regain profits in their time of economic struggle but that so far there has been no success. When he states “What is puzzling about this,” the audience is able to infer that Samuelson is aware of the details of the situation and acknowledging that the information is not adding up. Samuelson states that he’s written on this subject before due to his belief that “though obscure - it [ creative destruction ] is vital to our economic future,” and continually poses questions about the topic throughout the text showing that he dedicated to find answers about this “siege
Subsequently, in 1999 Kroger merged with Fred Meyer in a 13 billion dollar buyout. Fred Meyer itself was currently operating under many banners: Ralph's, Fry's, King's, QFC, and Smiths. Fred Meyer came with warehouses, its own food processing plants, dairy, bakery and ice creams pants and the largest trucking fleet, second largest jewelry store in the nation not to mention its absolute domination in the Northwest, with its 165,000 square feet store format. Fred Meyer shared the Kroger philosophy with one stop shopping on an even larger scale with its multi-department stores (The Kroger Co., 2012).
The following pages focus on providing a strategic analysis of Sears Holding Corporation. The introduction reveals the issues that the paper addresses. The Company Presentation section reveals important facts in Sears' evolution. The Strategy Debates Section discusses theoretical issues applied to the situation of Sears. This is followed by the Strategic Decisions section that provides a series of recommendations that can help Sears improve its situation. The Implementation Challenges section provides important issues that can be considered challenges of strategic implementation.
Acquisitions have also been important in the history of Kroger. In 1983, an acquisition of Dillon Companies Inc. allowed it to become a retailer of food, drug, and convenience stores from coast to coast. The biggest merger occurred in 1999 with the 13 billion dollar acquisition of Fred Meyer Inc. making Kroger the largest supermarket chain in terms of geographic coverage. The company was also the first to test
Sears Holding Corporation is the fourth largest retailer in the United States and Canada. Its subsidiaries include Sears, Roebuck and Co. as well as K-Mart. The closing of the merger between Sears and K-Mart took place on March 24, 2005. Sears has more than 4,000 retail stores across the United States, Canada, Puerto Rico, and Guam. Sears offers products and services through over 2,700 branded and affiliated stores. Sears operates 894 broad-line stores and 1,354 specialty stores. Sears’ broad-line stores are mall-based locations. The specialty stores include Sears Hometown Stores that are mostly independently owned, Sears Home Appliance Showrooms, Sears Hardware Stores, Sears Auto Centers,
If Wal-Mart needed a distribution center, they would build on in Florida, they would build one in Texas, and they would build one in California. Even without the additional warehouses, Wal-Mart had the advantage of better information systems. They knew what was selling and what was not selling in the stores whereas Kmart was just staying with the same-old, same-old, and did not bother to reinvest in its infrastructure logistics and inventory control.
Due to slow sales and less traffic at both Sears and Kmart, the two have decided to merge creating one entity named Sears Holdings. Kmart has agreed to buy Sears for $11 Billion. This puts Sears Holdings at the third largest retailer behind Wal-Mart and Home Depot. Although Wal-Mart is a direct competitor with Kmart, Sears Holdings goal is not to compete with Wal-Mart directly, but find areas that have been overlooked by other retailers, and take advantage of the expanded line of products the new company has to offer. Sears has had higher sales than Kmart, so hundreds of Kmart’s will be transformed into Sears stores. As of now, most of Sears 870 stores are only found in malls. The new strategy would be to open Sears stores in current
Sears Holdings Corporation is a company that came from two very well known organizations, Sears and Kmart. Both companies go back even farther than the 1900s and unfortunately both companies experienced financial difficulty at one point. With the merger Sears Holdings Corporation has the experience of both organizations as well as their different style of operating. Along with an improved customer base and a new outlook Sears Holdings Corporation is experiencing financial growth.
- Sears strategy for decades was based in malls, but after seeing the increasing sales of its competitor’s stand-alone “big box” retail model. Soon after Sear’s management started experimenting with an “off-mall” concept called Sears Grand. Sears experiment was successful and management wanted to roll out the off-mall Sears Grand concept nationwide at a fast pace and the same time Kmart wanted to sell fifty Kmart locations. The deal created significant values for both companies. This really got the wheels turning for both management teams for a possible merger.
The Home Depot bought more than 18 stores and Sears bought 45 for about $524 million. In that same year, Kmart Holding Corporation completed transactions to become a part of Sears, Roebuck and Company now known as Sears Holdings Corporation. Sears Holdings is listed on the NASDAQ under the ticker symbol SHLD. As of 2004 Kmart had 1,422 discount stores, 58 Kmart Supercenters totaling 1,480 stores. 1,323 of those stores were leased and 157 are company owned. Following the takeover, about 400 of Kmart's nearly 1,500 stores will be converted to Sears's outlets over the next three years.
What happened to the world’s leading store in America? In 1886, Richard W. Sears initially began selling watches by mail order (Reference for business, n.d). Then, he partnered with Alvah C. Roebuck and opened Sears, Roebuck, and Company; who later on was bought out by Julius Rosewalg. Sears had a new vision, and it was to sell clothing by catalogs at low prices. It took thirty years for the first retail store to open, and led the largest retails and sales even after the depression. Sears’ competition began to win over their customers, causing them to make serious mistakes in the early 1980s. According to Mourdoukoutas, Sears grew rapidly, purchasing independent businesses, ceasing sales through
Lampert purchased Kmart stock while still in bankruptcy and painstakingly emerged from bankruptcy on May 6, 2003. Immediately after emerging from bankruptcy, Lampert begin the renaming and restructuring of the Kmart organization, closing some 300 stores and laying off some 30,000 employees. Lampert renamed the organization Kmart Holding Corporation and immediately begin trading on the NASDAQ stock exchange on June 10, 2003.