Like a sinking ship that keeps jettisoning cargo in the hope of staying afloat, Sears Holdings will soon be ridding itself of 50 Sears Auto Centers and 92 Kmart Pharmacies.
Sears Holdings announced the plans Friday, noting that the 142 closures are intended to increase its cost savings target from from $1 billion to $1.25 billion, suggesting that despite several multi-million loans from CEO Eddie Lampert’s other ventures, $250 million is enough to right the retailer’s course.
Already this year, Sears revealed plans to close 150 stores, sold its well-known Craftsman brand, attempted to combine its DieHard brand with its Auto Centers, laid off countless employees, and turned sales floors into barren wastelands or big piles of boxes.
These efforts, the company says, have resulted into about $700 million in annual savings. But that’s simply not enough to turnaround the retailer’s death spiral.
“While we have made significant progress in reducing our cost base and enhancing our member value proposition, we need to take further action,” Sears Holdings CEO Eddie Lampert said in a statement.
That other action will include the closure of 50 Auto Center locations and 92 Kmart pharmacies, as well as the elimination of some senior management roles at Kmart and Sears stores.
Sears Holdings did not specify which Auto Center and pharmacy locations will close or when they will shut their doors.
As for the elimination of jobs, the company says the changes were made as an attempt to simplify the organizational structure of the company.
The Chicago Tribune reports that some employees were notified on Friday that their jobs would be eliminated, while others will be told in coming weeks.
Despite the new closures and lost jobs, Sears Holdings says it isn’t giving up just yet.
“As we sharpen our focus on profitable areas of our business, we will also continue to closely evaluate the longer-term viability of stores where a clear path to return to profitability is not in sight,” Lampert said.
Sears Holdings also notes that it is undergoing a comprehensive review to identify “broader opportunities for competitively priced products and drive operational efficiencies.”
This, of course, could include future closures, as the company notes it will “continue to take difficult yet necessary actions,” and that it will “leverage its lease optionality to reconfigure our stores and reduce capital obligations.”
Sears Holdings also announced that current controller and head capital market activities, Rob Riecker has been appointed chief financial officer.