Sears Canada is undergoing a major court-supervised restructuring process, during which it will close 59 stores and eliminate 2900 jobs.
Company shares were halted last week after the retailer was granted creditor protection under the Companies’ Creditors Arrangement Act. Sears will now have 30 days to restructure itself, axing 20 full Sears stores, 15 Sears Home stores, all 10 of its outlet stores, and 14 Sears Hometown stores—around one third of its total retail footprint. The company has been given $450 million in debtor-in-possession financing to fund its operations during this process.
While the reasons behind this restructuring are complex, e-commerce has made a huge impact on the store’s overall success. With the ability to price match online, as well as find lower prices elsewhere, consumers have been avoiding Sears purchases.
However, this isn’t Sears’s only issue. According to Bruce Winder, founder of the Retail Adviser Network, the company’s biggest problem is its inability to stay current.
“Momentum in retail takes years to gain and years to lose, but once you lose it, it’s gone, and I think that unfortunately they’ve lost that momentum,” he explains.
Winder adds, “Retailers need to evolve. They need to constantly look at their customer base and their stores, and keep investing to renew that.”
This comes as a reminder to other retailers—both independents and big box stores. Refusing to stay current with retail trends and consumer needs could ultimately cost you your business.
