Sears Holdings reported that total revenues for the third quarter were $3.7 billion, compared to $5 billion in the same quarter last year, representing a decrease of $1.4 billion.
Strategic store closures contributed to more than half of the decline, while comparable store sales contributed approximately another $471 million . Stores were also negatively impacted by the closure of a series of pharmacies in open Kmart stores, as well as a reduction in consumer electronic sales in both Kmart and Sears stores.
Sears saw a net loss for the third quarter of $558 million, compared to a net loss of $748 million for the third quarter in 2016.
“While our reported net loss was reduced by nearly $200 million, the strategic actions we are taking, including the fundamental restructuring of our operations, have resulted in meaningful progress in our performance enhancement efforts,” said Rob Riecker, Chief Financial Officer for Sears Holdings Corp. “Through these initiatives, we have achieved our annualized cost savings target of $1.25 billion ahead of schedule.”
Riecker said that Sears Holdings remains focused on streamlining its operations, right-sizing its store footprint, reducing operating expenses and taking incremental actions to further improve the financial performance despite a challenging retail environment. “We also continue to take action to improve our liquidity position and financial flexibility,” said Riecker.
Sears Holdings is also advancing several initiatives during the holiday shopping season. In the beginning of November, it launched its whole-store on sale holiday campaign at all of its Sears and Kmart locations.
“We are also offering our members the option to purchase their products online and ship them to the store for free, where our associates can even deliver the items to customers’ cars to make their shopping experience as easy and convenient as possible,” said Riecker.
Sears is also bringing back its Sears Wish Book, bringing members their favorite gifts in one place.
“We reinvented the Wish Book for 2017, reclaiming its place as the definitive source for thousands of gift options for every member of the family,” said Riecker.
Riecker said the company continues to be dedicated to its concept stores, ever since the opening of its Sears Appliances and Mattress stores in Pennsylvania and Hawaii. The company intends to open smaller concept stores.
Sears Holdings is also transforming its Shop Your Way membership program. Through the combination of technology and people-led services, the company is providing a personalized experience with curated offerings that customers receive based on preferences or through their one-on-one interaction of any of the 3,000-plus personal shoppers.
MCM Musings: Putting this article together, it seems as if Sears is doing everything it can to stay above water, but may only be treading water at this point. Opening new smaller concept stores and closing larger footprints might help stem the inevitable tide, as will providing a more personalized experience with their Shop their Way membership program. But without concrete solutions that enable growth, they may not survive in this uncertain retail climate.