A major retailer whose innovative marketing model is hailed as the Amazon of its day has just filed for Chapter 11 bankruptcy.
“Sears Holdings, whose presence permeated American life for generations, filed for Chapter 11 bankruptcy protection early Monday in a last-ditch attempt to avoid entombment in the graveyard of once-great retailers that failed to adapt to the digital age,” USA Today reports. “For Sears — which was the largest retailer in the nation before the rise of Walmart and, later, Amazon — bankruptcy marks the culmination of years of decline defined by store closures, sales declines, cost cuts and borrowing.”
As part of the bankruptcy, Sears Holdings, which has 687 stores and about 68,000 employees, is expected to close another 142 stores by about the end of the year, in addition to a recently announced round of 46 store closures, the story reports.
Sears, which also owns Kmart, shook up the retail model in its own time, not unlike how Amazon has changed the contemporary retail landscape. For Sears, it was the Sears Catalog, introduced in the late 19th century, that helped propel the company to unprecedented growth and proved to be a game changer in the retail business.
“Eddie Lampert, who has kept the company alive with a series of debt deals but faced criticism for lacking a clearcut turnaround strategy, has resigned as CEO but remains chairman,” USA Today notes. “He is also the company’s largest investor.”
Lampert said in a statement that bankruptcy will enable Sears to “strengthen its balance sheet, enabling the Company to accelerate its strategic transformation, continue right sizing its operating model, and return to profitability. Our goal is to achieve a comprehensive restructuring as efficiently as possible, working closely with our creditors and other debtholders, and be better positioned to execute on our strategy and key priorities.”