Congratulations!
You've just been appointed the adviser to the new CEO of Sears, even though he or she hasn't yet been hired.
Your job -- and you're getting paid big bucks to do it -- is to help figure out a way for Sears to be successful again and for it to become the department store of choice for millions of Americans.
You need a plan, a strategy. What will it be? How will you help salvage this retailing icon, which has been around since 1886, which invented the catalog and which has been so much a part of Americana? How do you turn around the dismal situation which Sears is in?
Granted, the word "dismal" is a tad subjective, so here, then, are a few facts:
* Sales revenues are trending down.
* Profit is down and for the fourth quarter 2007, Sears' profit is expected to decline more than 50 percent from the same period a year earlier.
* Same-store sales -- a retail key indicator -- have declined almost 3 percent this past year.
* The stock's value has declined almost 50 percent from its April 2007 price.
* There has been a revolving door in top management for the last two years and many attribute it to the difficulty of working for the chairman and chief micromanaging officer) Edward Lampert. Lampert, you recall, took control of Sears and Kmart several years ago through his hedge fund, ESL Investments.
People shop at retailers for various reasons: merchandise selection; price; convenience; customer service; cachet. Some experts suggest that it's a combination of factors -- the total customer experience -- that counts. So, Mr./Ms. Sears Adviser, what reason would you give people to make Sears their shopping destination?
It's been said that Mr. Lampert, though he's a financial wizard, has tried to cost-cut his way to a successful Sears.
He hasn't invested much in the stores, the merchandise or the employees. He did buy back shares and sold off real estate, which made the stock price soar last year, making him a Wall Street darling. But it doesn't look like he's given people a reason to shop there anymore.
In fact, I'm curious, Mr./Ms Adviser, when was the last time you shopped at Sears? And was it for anything other than Craftsman Tools or Kenmore appliances? When is the last time you went there for clothing or housewares or jewelry?
That's the heart of the matter. With all of the competition and choice, including online retailing, Sears has to offer something that attracts and keeps customers. Loyal customers. Profitable customers. Customers of all ages.
Right now, Sears doesn't seem to have that "something." So readers/advisers, what should they do? Write me and tell me your strategy.
Opinions expressed solely are those of the writer. Mike Hoban, of Crown Point, is a senior consultant for an international leadership development and training firm. Send mail to him c/o The Times, or e-mail him at business-at-large@sbcglobal.net.
