Report: Another 100 Sears and Kmart Stores to Soon Close, Chain Still Struggling

The Sears logo is seen outside a store in Brooklyn, New York, U.S., October 10, 2018. Shannon Stapleton/Reuters

Once-prominent retailer Sears declared bankruptcy about a year ago. Still, a new report from the Wall Street Journal revealed the firm is still struggling.

It reported that about a fourth of the 425 Sears and Kmart stores that were brought out of bankruptcy by financier Edward Lampert have closed or are set to close. The Journal cited sources close to the situation.

At some remaining Sears and Kmart locations, there were no lawnmowers being offered in the summer, and no garden supplies offered in the spring, shoppers, and a former executive told the outlet.

“It was hard to find anything to buy,” said Edgar Dworsky, a consumer advocate. Dworsky said he also went to a Massachusetts Kmart in May, saying the garden center was empty during the middle of spring.

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A former Sears executive said that a Sears in Illinois had no lawnmowers being sold during the summer. On the sales floor were snow blowers that weren’t sold during the winter season, the WSJ reported. But it noted that a Sears in Massachusetts had good traffic and stocked shelves.

In announcing closures in August, Sears said more closings are a possibility.

“Following these steps, we will continue to evaluate our network of Sears and Kmart stores and cannot rule out additional store closures in the near term,” the company said at the time, USA Today reported. “Our goal remains to return the company to profitability and preserve as many jobs as possible in the communities we serve.”

Outside of a Sears department store one day after it closed as part of multiple store closures by Sears Holdings Corp in the United States in Nanuet, N.Y. on Jan. 7, 2019. Mike Segar/Reuters

Lampert bought 223 Sears stores and 202 Kmart locations in February, along with the Kenmore and DieHard brands for about $5.2 billion under an entity known as Transform Holdco LLC or Transformco.

But, due to deteriorating sales performance, a person told the Journal that 21 Sears stores and five Kmart stores would be shuttered in the fall. Another 100 stores, most of them Kmarts, are to close by the end of the year. Transformco hasn’t disclosed where those will be.

Other Bankruptcies

Several U.S. retailers have filed for bankruptcy over the past two years, including Forever 21 and Toys ‘R’ Us.

Forever 21

The fast-fashion retailer filed late on Sunday to restructure its business and requested approval to close up to 178 U.S. stores. Forever 21 listed both assets and liabilities in the range of $1 billion to $10 billion, according to the court filing.

Payless Shoes

The U.S. discount retailer in February filed for Chapter 11 bankruptcy protection for the second time, along with its North American subsidiaries. The retailer had said it would close about 2,500 stores in North America and wind down its e-commerce operations.

A view inside a Forever 21 store in Union Square in Manhattan, New York City on Sept. 12, 2019, in New York City. Photo by Drew Angerer/Getty Images

Toys ‘R’ Us

The toy retailer filed for Chapter 11 in September, hoping to restructure some $5 billion in debt, much of which stemmed from a $6.6 billion leveraged buyout by private equity firms in 2005. It liquidated in 2018, a blow to hundreds of toy makers that sold products to the chain, including Barbie maker Mattel Inc and rival Hasbro Inc.

Radio Shack

The U.S. electronics chain filed for bankruptcy in March for the second time in a little over two years, faced with a challenging retail environment and an unsatisfying partnership with wireless provider Sprint Corp.

Fred’s Inc.

In September, the pharmacy and discount retailer said it filed for Chapter 11, months after the company began shuttering hundreds of unprofitable stores in the United States.

Gymboree

The children’s clothing retailer filed for bankruptcy protection in January, the second in almost two years, and said it would close more than 800 Gymboree and Crazy 8 stores.

HhGregg

The appliances and electronics retailer and its Gregg Appliances Inc unit filed for bankruptcy protection in March, as they continue struggling with declining sales for about the past four years.

Reuters contributed to this report.