Sears gone from Panama to Pittsburgh

 
1,105Views 18Comments Posted 23/03/2017

By Mark Scheinbaum

MIAMI (March 23,)—Almost 132 years ago a guy named Richard Sears with his buddy Alvah Roebuck challenged conformity and launched a revolution in retailing.

This week the company Sears which also controls K Mart stores warned shareholders it might go bust.

When the two watchmakers started a mail order catalog for watches and jewelry it was the Amazon of its day. There had been other mail order businesses and catalogs but Sears and Roebuck took things to new levels. You could pick up a mail order lawnmower at their store on Avenida Central in Panama or drop off your Allstate car insurance payments at their store in Flatbush, Brooklyn.

The mail could deliver fabric for your daughter’s dress or paint for the barn to your home in Montauk or Missoula. But times have changed.

Wall Street analysts have been told for years by Sears Holdings that the real estate under each store is worth so much money that loss of sales and shrinking profit margins are less important than the real property of the firm.

The problem is that the United States—and increasingly other countries—are replete with empty strip malls, anchor stores, and entire shopping malls which once were jammed with customers.

What is the added value of a retail store with lots of land and buildings, when more people work and shop online, have flex time schedules, and do not crave the movies, restaurants, and sales of a trip “to the Mall?”

Much has been written about online shopping versus the retail store experience. But mall developers and managers and retailers themselves have added to their own problems.

In some cities malls have been overbuilt and Panama may be heading that way.  In some cases security in the Age of Terror is way too lax, where the only armed guards seen by shoppers are the gun-toting guards hauling bags of money to a Brink’s armored truck in the parking lot.

Even at the macro level, sloppy planning and thinking dooms many retailers. In the booming Panama economy a square block of already trendy shops and homes in the Obarrio section was razed for a square block inner city “SOHO Mall” anchored by stores such as Cartier and Hermes and super VIP movie theaters.  Perhaps tenants should have checked the owners and developers who within two years were charged with drug money laundering in four countries and leases, employment contracts, and ownership of the entire venture was thrown into chaos.

In Miami’s super glitzy Brickell area another one of these square block inner city malls has opened with a Saks Fifth Avenue anchor store. Parking and logistics around the mall are almost impossible on a good day, and the shops inside replicate similar shopping experiences offered in the area by Merrick Park, Bal Harbour and the Miami Design District. It’s another case of too many stores and too few walk in customers.

As if to put a big “Screw You!” sign outside Sears, Macy’s, J.C. Penny and other stores, some retailers have defied the doom and gloom forecast of an “end to the retail world”  and studied their markets and prospered.

Burlington, the old Burlington Coat Factory, has placed most of its stores away from the central mall buildings, on perimeter roads, or in old neighborhood strip malls where rents are cheap and middle income shoppers are already shopping for groceries or picking up dry cleaning. With deep discounts and a huge daily inventory turnover of top brands such as Burberry their biggest problem seems to be long lines at checkout. Ditto for Nordstrom Rack, Ross Dress for Less, TJ Maxx and other off price stores that have cherry picked lower rent or lease venues and studied customer income and needs in each zip code.

Back to Sears there are many reasons over the years that the Rolls Royce of American retailing faded as Wal-Mart rose to the pinnacle of expansion and sales. When the gap between top management and Sears employees grew wider and the Retail Clerks International Union AFL-CIO staged organizing drives and NLRB petitions, Sears spared no expense in sprinkling raises and promotions to defeat collective bargaining. For sure union critics would point to the labor movement hurting the bottom line but there have been cases such as Ford even to this day when labor and management worked to save a company, refuse federal bailouts and prosper in tough times.

In good times and bad, Sears failed to tell the “Sears Story” to potential customers. The hand tools, home workshop equipment, and Kenmore and other appliance lines were the top quality and dependability brands. When Sears continued to pay health and hospitalization insurance for most workers called up to Gulf Wars by the National Guard or Reserves, it was almost hushed up—as if the news that corporate money was spent on protecting the families of those wearing military uniforms in service to America might anger shareholders or stock pundits.

The positive public relations value and rally of investor support would likely have done the opposite. The Sears story was a great story. But it was a mismanaged story in recent years.

We live in a world in which dinner is too often the decision to call Domino, Pizza Hut, or Papa John. We live in a world in which once this culinary decision is made one now must decide to pay by cash, credit card, debit card, PayPal or Amazon Prime reward points.

Perhaps the only positive note for the soon-to-be-vacated Sears real estate properties is that some empty strip malls are now rented for motor vehicle and unemployment offices.

Mark Scheinbaum is managing director of Shearson Financial Services LLC in Boca Raton, FL. A former UPI newsman and business magazine publisher. His opinions are his own, and are neither an endorsement nor disapproval for any securities mentioned in the article.

     



Comments 18

user
Richard Charron

I fixed this for you Bob. I blocked you and you should do the same to me and then we can agree to disagree.

2 years ago
user
Bob

You haven't googled "gaslight" yet? You really are a piece of coprolite. For a guy with such a big mouth you sure are a pussy when it come to backing up what you have to say. So yea you have a new name...pussy....I'd be glad to call you it to your face just let me know when and where....pussy.

2 years ago
user
Richard Charron

You are offended with "idiot". I only reserve that name for people I like. Let's review. In the last month or so you have called me: asshole, Nazi fascist, prick, Sr. bull shit, a joke, gas light (whatever that means), blowhard and I have been told that I am full of shit. You probably need to thicken your skin or tone down your idiotic responses. It doesn't matter which side of an argument I take you automatically take the other side even if it is wrong. Maybe you should do like Garlic and just refuse to engage.

2 years ago
user
Bob

You know if you would like to call me a idiot to my face you are certainly welcome to you fucking Nazi fascist. Just tell me where and when prick.

2 years ago
user
Richard Charron

I already said you were right. At least in your fantasy world pigeon. Streets with two or three names makes it that much easier to find. You are a total idiot. I have to say you are much more fun that Garlic. Sometimes he makes sense, you on the other hand are always out in space.

2 years ago
user
Bob

When she was young they had daily home delivery.

2 years ago
user
Bob

Wow the ass hole in you is really shining today. Have you ever pulled yo Google Maps? Streets have names, hell some have 2 or 3. I've had 3 addresses here in the city and 1 in David, they all had an address. You're probably thinking a address needs a street number to be a address well that is where you are wrong again.

2 years ago
user
james fry

They had delivery daily to the post office (still do), but only to the post office, usually the one nearest your home area...... but not always, often ya gotta go on Post Office Search to find the one that has your mail. Sometimes neighbors band together and one makes the post office trip to pick up everyone's mail and bring it back. That's why every business in the city uses private courier services to send bills.

2 years ago
user
Richard Charron

You're right. It would be easier teaching a jackass to drive a bus than to try have you understand any type of problem that is outside or your beliefs. Enjoy your FedEx deliveries and rejoice in the fact that you have a visible address on a street with a name. You are among the chosen ones.

2 years ago
user
Bob

So it's delivered by a carrier? What's the difference, it's delivered to an address that is what's important. Again FedEx and DHL (I've never seen a UPS truck here in Panama) have no trouble making deliveries because they use addresses. It's not impossible to have mail delivery system here in Panama. My wife said when she was a child they did have mail delivery. It is not impossible. I'm sure if you took 5 minutes and asked a neighbor you would learn what your address is but first you would have to learn some basic Spanish.

2 years ago
user
Richard Charron

You are so correct, that's why you see so many UPS and FedEx trucks running up and down the roads. LOL Your electric bill is delivered by messenger not by a carrier. Why do you think it is impossible to have a mail delivery system in Panama?

2 years ago
user
Bob

I don't know what Panama you live in but the one I live in has street names as do most other Latin countries. My electric bill is delivered every month to my apartment. FedEx and DHL have no problem finding me. Why would it be impossible to buy something on line and have it delivered?

2 years ago
user
Bob

My wife tell me that when she was young they had daily postal delivery so they mush have had some system.

2 years ago
user
james fry

Without street names & addresses merchandise order & delivery from from Internet purveyors is not possible. People in Panama cannot buy goods online as virtually all Internet merchants require a delivery address. to even place an order. They're not set up to accept "on the street by the school in front of the man who sells tires" as a delivery address. Since on-line sales are brick & mortar's only competition, Panama's place in the 1950's remains unchallenged.

2 years ago
user
Richard Charron

You are so correct. When back in the States, with the exception of groceries, I do most of my shopping online with the resulting delivery of merchandise to my door. This is not possible in Panama, Colombia or many other Latin American countries due to the absence of street names and addresses. Therefore to your comments, brick and mortar businesses will continue to thrive.

2 years ago
user
Garlicball

How will assigning street addresses to businesses and living quarters affect brick & mortar establishments? I cannot connect those dots.

2 years ago
user
Garlicball

These vacated strip malls and abandoned stadiums should be converted into apartments.

2 years ago
user
Candid Curmudgeon

Brick and mortar stores will thrive forever in Panama unless it adopts street addresses and postal home delivery.

2 years ago
The comments are the responsibility of each author who freely expresses his opinion and not that of Newsroom Panama.
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