Sears celebrates rare store openings
Sears on Thursday announced the opening of two appliance and mattress stores in Camp Hill, PA and Honolulu. The locations are based on similar concepts in Ft. Collins, CO, and Pharr, TX, according to company press releases.
The 12,248-sq. ft store in Camp Hill is at the Capital City Mall, while the 16,200-sq. ft. store in Honolulu is located in the Mauka wing of Ala Moana Center, the company said.
The openings are rare for the struggling retailer, which last week said it would shutter another 63 Sears and Kmart stores, mostly in the South and Midwest, making for roughly 400 total store closures this year.
Sears and Kmart stores are folding at a record pace, a necessary strategy of attrition, the retailer says, to maximize productivity. It's a remarkable decline for the former rivals, which once dominated the retail landscape. Sears and Kmart were once go-to department stores with Amazon-like levels of merchandise assortment and customer loyalty. The most recent plans to shutter stores come on top of hundreds announced in recent months.
Despite those mass closures, the company has announced a few store openings, including the June grand opening of its first Sears Appliances & Mattresses store in Pharr, TX. That effort builds on the success of its new Ft. Collins, CO Sears Appliances store last year – a location the company says "has surpassed projections."
"At our new [stores in Pennsylvania and Hawaii], the community will find an innovative, interactive shopping experience that showcases our leading array of appliances and mattresses, with the support of expert associates," Leena Munjal, senior vice president of customer experience and integrated retail at Sears Holdings, said in a statement. "This new store helps our members easily find the best product for them to live life now and enjoy these products in their homes for years to come."
The stores offer free services like appointments with in-store experts; buy online/ship to store and in-vehicle pickup; and "Anyone, Anywhere Pickup," where customers can order an item on Sears.com or Kmart.com and send a friend or family member to pick up the purchase. The company said the service is particularly useful for parents purchasing items for their kids who may be away at college. Free shipping is also available in Camp Hill, the company said.
It's not clear how much of a difference the openings will make at this point, however. Sears, along with Macy's and J.C. Penney, are "future-proofing their offerings by closing stores," according to a new report from retail think tank Fung Global Retail & Technology. "We estimate that these closures will result in a total of $2.5 billion in annual sales being freed up for alternative retailers to grab," according to the report. "Approximately $1 billion of that total will come from Macy’s closures, $1 billion from Sears and Kmart closures, and $500 million from J.C. Penney closures, we estimate. Based on shopper preference data, we expect Macy’s to retain the highest share of sales when it closes stores and Sears to see the lowest sales-retention rates."
Around $1.5 billion, or 60% of those relinquished sales, will be in the apparel category, which includes footwear and accessories, Fung said. Kohl's and J.C. Penney will also benefit from the closures, (even though J.C. Penney is also shuttering underperforming locations), with J.C. Penney particularly benefiting from Sears closures due to their customer overlap. Macy's, on the other hand, whose customers tend to be more concerned with brands and choice, and less so with price, will likely lose sales to Amazon. Target, Kohl’s, Best Buy and J.C. Penney also benefit from Macy's closures, according to the report.
Fung's research validates Sears' hopes that customers whose local stores close will gravitate to its website and other locations, but Sears and Kmart together are likely to retain just 17% of their former sales volume, compared to 22% for J.C. Penney and 25% for Macy's.
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