Eddie Lampert's mismanagement of Sears is the
reducto ad absurdum of financial "wizards" attempting to succeed as business operators.
I will never forget reading this article (from 2011): https://www.wsj.com/articles/SB10001424052970204517204577042....
'While retail experts estimate that store chains traditionally spend $6 to $8 per square foot on annual maintenance, Sears is spending a fraction of that amount, said Matthew McGinley, managing director of International Strategy & Investment Group, an investor research firm.
"With roughly 250 million square feet domestically, [Sears] is spending about $1.90 a foot, which is a quarter of what you need to maintain share and keep it as an acceptable place to shop," Mr. McGinley said.'
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Nor will I forget reading about his management philosophy where different Sears departments have to compete for money in the budget. Money to advertise, to purchase inventory, etc. (https://www.bloomberg.com/news/articles/2013-07-11/at-sears-...)
To the average "person on the street", it may be patently obvious that when your stores are filthy and understaffed, no one will want to shop there. To Eddie Lampert, the way to juice EBITDA for a few years is to slash that maintenance money.
Pour one out for the death of multiple iconic American brands (Craftsman, Kenmore, and eventually Sears itself). Don't shed a tear for Lampert, since he's set himself up for a "heads, investors, customers, and employees lose" and "tails, I win" situation.
I will never forget reading this article (from 2011): https://www.wsj.com/articles/SB10001424052970204517204577042....
'While retail experts estimate that store chains traditionally spend $6 to $8 per square foot on annual maintenance, Sears is spending a fraction of that amount, said Matthew McGinley, managing director of International Strategy & Investment Group, an investor research firm.
"With roughly 250 million square feet domestically, [Sears] is spending about $1.90 a foot, which is a quarter of what you need to maintain share and keep it as an acceptable place to shop," Mr. McGinley said.'
---
Nor will I forget reading about his management philosophy where different Sears departments have to compete for money in the budget. Money to advertise, to purchase inventory, etc. (https://www.bloomberg.com/news/articles/2013-07-11/at-sears-...)
To the average "person on the street", it may be patently obvious that when your stores are filthy and understaffed, no one will want to shop there. To Eddie Lampert, the way to juice EBITDA for a few years is to slash that maintenance money.
Pour one out for the death of multiple iconic American brands (Craftsman, Kenmore, and eventually Sears itself). Don't shed a tear for Lampert, since he's set himself up for a "heads, investors, customers, and employees lose" and "tails, I win" situation.