Week 2: The Questionable Futures Facing Retailers

This week we read an article about Sears Holding, which was very interesting to me. The article talked about how Sears companies spent too much money fixing up their stores and spend too much time worrying about sales growth, but not enough about profitability. However, I disagree with Sears business approach. I haven't been to a Kmart or a Sears in a long time.  This is because the last time I went to either all I can recall is how dirty the stores were.  The decor and shelves were so outdated it made everything in the store look super unappealing. Even if there are good sales I can't bring myself to go into either store because of how unclean they are.  The company really needs to think about focusing on consumers needs and presentation of the stores.  Maybe if the stores had better up keep then more clientele would feel like returning.  The company needs to re-evaluate themselves as a company and focus on their target market and most loyal customers in hopes of gaining more profitability.  Otherwise, the company is going to just keep closing more stores. 

Another point that we touched on in class was comp store sales.  These are same store sales that are compared from one year to the next.  Sears Holding ended up closing over 120 stores for poor comp sales.  If stores continuously experience negative or same sales then the store will struggle to make a profit over time. This effects the stores profits, store stocks, and the companies ability to pay off expenses.  In class we discussed that one way to improve comp store sales was for the store to sell something that it doesn't normally sell.  This makes it convenient for shoppers because they do not have to make a second trip to another store to get different items because they are now offered at the current store.  This also provides a new product income that the store didn't have before.  This could hopefully provide more sales for the store and increase overall revenue.