Great ResignationInflationSupply ChainsLeadership

Sears Is Exploring Options for Its Kenmore and Craftsman Brands

May 26, 2016, 12:04 PM UTC

Sears Holdings (SHLD) is looking for ways to squeeze much needed money out of its most attractive remaining assets: its Kenmore, Craftsman, and DieHard appliance and tool brands.

As the company reported yet another quarter of deep losses and comparable sales declines at its Kmart and namesake department stores, Sears said it was considering options for those popular, market-leading brands, as well as its Sears Home Services repair business.

Sears did not spell out what those are, but they conceivably could include selling them off and licensing them to other retailers. Sears remains the top seller of large appliances in the United States and operates the largest home repair service in the country. In 2014, the retailer installed 4.5 million appliances.

“Our iconic KCD brands are beloved by the American consumer and we believe that we can realize significant growth by further expanding the presence of these brands outside of Sears and Kmart,” the company said on Thursday. The home-services business also “has greater potential than what we have delivered in the past.”

Parent company Sears Holdings reported Thursday that its quarterly net loss deepened to $471 million, or $4.41 a share, from $303 million, or $2.85, a year earlier. Comparable sales, which strip out the effect of recently opened or closed stores, fell 5% at Kmart and 7.1% at Sears, continuing a long degradation of both chains’ businesses. In February, Sears Holdings reported its 11th straight year of comparable sales declines, despite closing hundreds of weak stores over the years.

The company reported soft apparel sales, echoing the complaints of rivals like Macy’s (M) and Kohl’s (KSS), which also reported awful quarters.

Sears Holdings lost more that $8 billion in all between 2010 and 2015, prompting it to sell off key assets like its Lands’ End clothing brand and its stake in Sears Canada, as well as shifting hundreds of its best store locations into an investment vehicle to raise billions of dollars and stay solvent. Some cynics have said Sears is conducting the longest liquidation sale in history.

For years, Eddie Lampert, the hedge fund manager who is Sears Holdings’ chairman, CEO, and largest shareholder, has promised investors he is transforming the business by beefing up its digital and loyalty programs to turn Sears into a leaner retailer that relies less on big box stores. But so far he has little to show for it.

And now Sears’ appliance business faces a renewed threat from rival J.C. Penney (JCP), which recently rolled out its new home appliance areas to 500 stores, returning to the product category after a 33-year absence.


Sears sold about $4 billion worth of appliances last year. Its repair service’s 7,000 technicians visit 8 million homes a year, giving the retailer a trove of data that could be useful as more consumers buy smart home products and connect them via the so-called internet of things.

Sears hired Citigroup Global Markets and LionTree Advisors to advise it on the search for alternatives for its appliance and tools brands and its home-services business, but said there are no guarantees that it “will complete one or more transactions.”