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ears and Roebuck is the best known name in American retailing. It's 103
years old. Roughly there are 875 stores. The Sears Roebuck catalog is one of
the traditions of American culture for the last century. 60 million Americans
hold Sears credit cards. And yet Sears doesn't know where it fits. . . . . .
. . . . . . . . doesn't know its place in the marketplace . . . . . . . . .
finds itself on the horns of a dilemma. A total volume of $48.8 billion.
"That sounds successful," you say. I didn't say profits. . . I said gross
revenue. . . and that includes three other divisions: a brokerage firm, an
insurance firm, and a real estate firm. But most of that from retailing. For
about six times, Sears has tampered with its fit. It has tried to upgrade its
prices and its merchandise. In doing so they have arrived at a mid price
range. In the US. . . . at least today. . . .people want it deeply
discounted. . . or expensive. Nobody's looking for mid-price stores. . . or
mid-priced merchandise. "Sears built its reputation on good quality products
at low prices," you say. That's right. And then, thinking that's not quite
where they fit, they shifted their prices and their products upward. And K mart. . . founded by a dime store chain. . . in a period of less that 15 years
took the place that Sears vacated along with Sam Walton of Wal-Mart, who
became the wealthiest living man in America. Merchants would say: "They ate
Sears' lunch!" But they would also say: "It's because Sears didn't know quite
where it fit." So now, they're a takeover candidate. . . for those that know
nothing about merchandising to come in and buy them out. To prevent that
they've restructured. They decided to . . . . . buy back 10 percent of their
own stock. . . . to sell the tallest building in the world, (Sears Towers in
Chicago) which was their pride and joy. . . . move out 8,000 employees from
that building . . . sell off part of their real estate division . . . and to
go back to discounting. . . meeting competitive prices at the lower end,
rather than mid-pricing their products. (You probably heard the ads on the
radio about this last month.) Sitting in a restaurant, a man was overheard to
say, "You know, I'm kind of like Sears. . . I've got to restructure." What did
he mean by that? What he meant was. . . he didn't know where he fit. And
that's not quite a new dilemma. You know the smartest thing about Sears? They
didn't wait until they failed. . . until an outsider came in and bought them
out and took them over to realize: "We're a misfit where we are. We want to
go back to the basics. We want to go back to what made us famous, to what
gave us our position in the history of merchandising."
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