KMart - Bleak outlook and poor earnings are weighing down this sinking ship

[exracer327]

35 minutes ago, brickvoyeur said:

They count on the stupidity of the consumer. One near me closed a few months ago and they had marked all of the new sets up 20% (of the already inflated K-Mart prices) right before doing their 30% off. People gobbled them up believing they were getting a deal. All of the old retired sets actually received the 30% off of their current mark down... so naturally those are the only things I gobbled up. After round 1 of clearance they didn't allow you to use coupons anymore.
 

By the time 50% off (of the 20% boost on the already inflated prices) came around it was slim pickings. I only grabbed a couple sets at 50% since there was so little left.

Hopefully your store follows a different model.

I had the same experience in the only K-Mart within 30 miles of me.  Inflated prices, sales were a joke.  I thought I was in TRU while looking at their LEGO selection.  Funny how both of them are the ones in trouble.

[thoroakenfelder]

I thought it was interesting to see what was left after people had already been gobbling up the overpriced junk that was there. I think it says something about the popularity of stuff like the constraction figures. They were drastically discounted at Walmarts and now people won't touch them when they've bought everything else including the beat up Encounter on Jakku that was there.

[keymomachine]

On 9/26/2017 at 9:14 AM, MinifigW said:

So you've been reading the same thread I have lol.

According to someone else with authority on the matter, the "Shop Your Way Superstore" concept that was in testing may be coming to play. With Elmhurst IL being a testing ground (would explain why they closed the Kmart there, it was top 10% in the chain)

Come to think of it, I noticed some massive merchandise shifting going on at my local Sears (Chicago Ridge) a few weeks back, the one nearest the closing Kmart that actually seemed to do pretty good business, perhaps it's being considered for this new concept, or maybe they just realized no one goes upstairs so they were moving more things down.

[Phil B]

Three interesting bits of news on Sears:
1. Store liquidation in Canada is a massacre: http://www.businessinsider.com/sears-clearance-sales-canada-chaos-2017-10/#sears-ceo-eddie-lampert-dodged-responsibility-for-sears-canadas-failure-in-a-blog-post-published-on-sunday-14

2. Eddie has given Sears Holdings another $100m to hand out to shoppers as free money over the holidays: http://www.businessinsider.com/sears-borrows-another-100-million-from-ceo-2017-10

3. Whirlpool is no longer supplying Sears with merchandise: http://www.businessinsider.com/sears-whirlpool-relationship-ends-2017-10

[exciter1]

My store started closing clearance today with toys at 25% off.

 

[fossilrock]

51 minutes ago, exciter1 said:

My store started closing clearance today with toys at 25% off.

I bet that's like losing a best friend for you...

[exciter1]

I bet that's like losing a best friend for you...

Yep, they said I️ could take home 10 or so asbestos tile before they close.

[fossilrock]

6 minutes ago, exciter1 said:

Yep, they said I️ could take home 10 or so asbestos tile before they close.

The ones from the aisle right under the lego sets?

[exciter1]

The ones from the aisle right under the lego sets?

Yep, the stained ones from the old Slush Puppies machine are already claimed.

[MinifigW]

1 hour ago, exciter1 said:

Yep, they said I️ could take home 10 or so asbestos tile before they close.

One of my closing stores gave me a T-shirt and a bunch of signage. Keeping them as mementos.

[squeakdigital00]

Does the 10 20 30 40 in points end tonight?

[Phil B]

Sears had a miserable, miserable Christmas

 

http://money.cnn.com/2018/01/10/news/companies/sears-sales-plunge-cost-cuts/index.html

 

Best quote:

Quote

Lambert again insisted that the company is on course to turn a profit in 2018. But he also ominously warned that the company's board will "consider all other options to maximize the value of Sears Holdings' assets" if the company can't refinance its debt.

 

Edited January 10, 2018 by Phil B

[Phil B]

Just in case it needs to be said again for those with too much on the line at Sears/KMart, the below warning was posted on SD yesterday. Pretty much sums it up:

ALERT: Okay folks, for the first time Fast Eddie has issued a between the lines bankruptcy warning for Sears in his latest blog entry [searsholdings.com].

Quote
However, should our efforts to complete the refinancing not be fully successful, the Company's Board will consider all other options to maximize the value of Sears Holdings' assets.
This is Wall Street English that means the Board will declare bankruptcy to protect shareholder value by protecting assets from liens and seizures if it doesn't get additional lines of credit at reasonable terms.

The problem is Sears is running out of assets (namely property) it can use to secure those loans, and the interest rate is growing higher on subsequent loans as the company's financial condition worsens. Unfortunately, Sears cannot cover all of its expenses now without borrowing more money.

Note Lampert says "fully successful" when he could have said "successful" alone. That means the metrics for Sears' ability to continue in business depends on ALL of its needs being met, not just some of them.

That quote alone will guarantee Sears' suppliers will panic and start pulling the company's credit lines, fearing they won't be paid. More will insist on full, upfront payment. Sears cannot afford to do that.

Sears is also busily trying to refinance existing debt as interest rate increases continue. Almost all of Sears' major loans are variable interest.

Sears and Kmart holiday sales were a total disaster, dropping 15-17% year over year at a time when other retailers gained 4-5%. The average dormant or new SYWR member received over $100 in FREECASH promotions in November and December with no minimum purchase requirement, and that failed to bring most into stores to spend it. This means a growing percentage of customers have completely written off both chains and have no intention of returning regardless of sales or promotions.

The number of active SKU's - merchandise actually available for sale - achieved a new all-time low. Customers are not finding the products they want. Kmart's grocery department also cratered to a new worst-ever performance -- now too low for many soda, refrigerated food, and bread vendors to continue servicing Kmart on a weekly basis. Some are pulling out, others will switch to monthly replenishment.

The percentage of spoiled/expired Kmart grocery items that were thrown out also reached the highest level ever seen by any national chain since records were first recorded in 1969. You have to pay $765 for the report to learn what that percentage was, but one can imagine.

Kmart's pharmacy division will drop well below 100 stores in 2018 and will be de-certified in certain states.

As a result of all of this, absolutely nobody other than Mr. Lampert in the business community expects Sears and Kmart will remain in business as it is now beyond this year. Many expect a bankruptcy protection filing in the spring or early summer, or another radical cost-cutting move to stall that for a few more months. One major investor liquidated more than a million shares of Sears stock, according to SEC filings.

I've seen enough to recommend people who want to protect any gift cards or accrued points should consider liquidating them by the end of March to be safe. If you can accept increasing risk those could become worthless, you can wait until June. Be aware that Sears appliances are not a good investment to dump lots of points on. Parts vendors to service those appliances are fleeing Sears and are increasingly not filling parts orders, so if it fails, you cannot expect a prompt warranty repair from Sears, and Sears Canada screwed those with extended service plans up there after bankruptcy and the same is likely to happen down here.

[Phil B]

Not sure where to place this, so here goes:

Delta Air Lines and Sears Holding on Thursday disclosed a data breach that may have exposed the payment card details of hundreds of thousands of online customers. From a report: The breach originated at a software vendor called [24]7, which provides Sears, Delta, and other businesses with online chat services. Less than 100,000 Sears customers were supposedly impacted, according to Sears. A Delta spokesperson said hundreds of thousands of travelers are potentially exposed. Gizmodo has learned the breach was the result of a malware attack, and that the unauthorized access involved payment card numbers, CVV numbers, and expiration dates, in addition to customers' names and addresses. In a statement, [24]7 said the breach occurred on September 27th of last year and was contained roughly two weeks later. In a statement, Sears said it was first notified about the breach in mid-March. Credit card companies have been notified, and law enforcement is likewise investigating the incident. "Customers using a Sears-branded credit card were not impacted," Sears said. "In addition, there is no evidence that our stores were compromised or that any internal Sears systems were accessed by those responsible."

Funnily enough I got a new CC last month as my previous CC had a non- authorized AirBnB charge on it. I have used that CC to pay through chat at Sears ......

[exciter1]

26 minutes ago, Phil B said:

Not sure where to place this, so here goes:

Delta Air Lines and Sears Holding on Thursday disclosed a data breach that may have exposed the payment card details of hundreds of thousands of online customers. From a report: The breach originated at a software vendor called [24]7, which provides Sears, Delta, and other businesses with online chat services. Less than 100,000 Sears customers were supposedly impacted, according to Sears. A Delta spokesperson said hundreds of thousands of travelers are potentially exposed. Gizmodo has learned the breach was the result of a malware attack, and that the unauthorized access involved payment card numbers, CVV numbers, and expiration dates, in addition to customers' names and addresses. In a statement, [24]7 said the breach occurred on September 27th of last year and was contained roughly two weeks later. In a statement, Sears said it was first notified about the breach in mid-March. Credit card companies have been notified, and law enforcement is likewise investigating the incident. "Customers using a Sears-branded credit card were not impacted," Sears said. "In addition, there is no evidence that our stores were compromised or that any internal Sears systems were accessed by those responsible."

Funnily enough I got a new CC last month as my previous CC had a non- authorized AirBnB charge on it. I have used that CC to pay through chat at Sears ......

I don't think I've ever done that through chat services.

[squeakdigital00]

My debit got hit last month 5 unauthorized charges. Eat24 California and Florida.... Fine Dining take out orders. I've since changed everything. Coincidence?

Sent from my SM-G955U using Brickpicker Forum mobile app

[waddamon]

Major rule of finance.  Never use a debit card, other than known ATM withdrawals or deposits, ever!  CC always. Especially online or gas stations.

[Phil B]

More store closings, mainly Sears:

Park Mall, 5950 E Broadway Blvd. Tucson, Arizona
Sunrise Mall, 5900 Sunrise Blvd., Citrus Heights, California
Westfield Galleria at Roseville, 1191 Galleria Blvd., Roseville, California
Solano Town Center, 1420 Travis Blvd., Fairfield, California
Parkway Plaza, 575 Fletcher Parkway, El Cajon, California
University Mall, 7171 N Davis Hwy, Pensacola, Florida
Countryside Mall, 27001 Us 19 N, Clearwater, Florida
Oaks Mall, 6201 W Newberry Rd, Gainesville, Florida
Broward Mall, 8000 W Broward Blvd, Plantation, Florida
Marketplace at Six Corners, 4730 W Irving Park Road, Chicago, Illinois
Lindale Mall, 4600 First Ave. NE, Cedar Rapids, Iowa
Columbia Mall, 2201 W Worley St, Columbia, Missouri
Maplewood Mall, 3001 White Bear AVE N, Maplewood, Minnesota
Meadowood Mall, 5400 Meadowood Mall Circle, Reno, Nevada
Greece Ridge Center, 317 Greece Ridge Center Dr, Rochester, New York
Independence Mall, 3500 Oleander Drive, Wilmington, North Carolina
Asheville Mall, 1 S Tunnel Road, Asheville, North Carolina
Southern Park Mall, 7401 Market St., Youngstown, Ohio
Wyoming Valley Mall, 88 Wyoming Valley Mall, Wilkes-Barre, Pennsylvania
Park North Shopping Center, 622 NW Loop 410, San Antonio, Texas
Warrenton Village Center, 141 W Lee Hwy, Warrenton, Virginia
Overlake Fashion Plaza, 2200 148th Ave NE, Redmond, Washington

Kmart

1602 W Brandon Blvd., Brandon, Florida
180 Main St., Saugus, Massachusetts

[Phil B]

The end of Sears is coming closer. From SD:

Sears Holdings held a conference call this morning for shareholders about discussions to abandon or reform the Shop Your Way Rewards program and selling it or spinning it off to a third party. This is under exploration at this time. It is not a done deal, and if there are no buyers, nothing will change unless they end it themselves. Basically the proposals range from an 80% trim on SYWR promo spending, offering membership points and rewards to Sears credit card holders only, and charging a $29-49 annual fee for membership.

Fast Eddie continues to explore taking Sears Holdings private. This morning, his hedge fund offered $400 million to acquire the Kenmore brand. He also admitted this morning Sears has a liquidity problem, which will trigger a vendor stampede to the exits. Companies that admit this are no longer qualified for third party vendor assurance insurance, which guarantees vendors someone will pay them for goods shipped in. That will mean cash upfront, something Sears cannot do.

Fast Eddie is offering to acquire Sears Home Services for $80 million.

Also, Lampert has announced ALL remaining Sears and Kmart locations owned by Sears Holdings are now available for immediate sale, either to replace Sears or Kmart or to lease back the property to Sears or Kmart to keep those stores open.

Most ominously, Lampert is now asking debt holders about their possible interest in debt restructuring/forgiving debt to stave off bankruptcy.

I’ve got some points accruing for immediate use this coming Monday. I hope they stay around till then, and I hope LEGO doesn’t pull inventory beforehand. Going to be a close call....

 

**UPDATE** All LEGO is now showing as TEMPORARY UNAVAILABLE on KMart.com and what I had in my cart poofed out of it .... the purge might have started. Perhaps a visit to my local KMart tomorrow instead?

Edited August 15, 2018 by Phil B

[Phil B]

1 hour ago, Phil B said:

 

**UPDATE** All LEGO is now showing as TEMPORARY UNAVAILABLE on KMart.com and what I had in my cart poofed out of it .... the purge might have started. Perhaps a visit to my local KMart tomorrow instead?

False Alarm ... it's all back again....

[keymomachine]

Saw the ominous news and decided not to hesitate and used about $70 in points along with $10 in surprise points to get Outdoor Adventures people pack, Sweet Surprises, and the Arctic exploration team for ship to store pickup at my local Sears. Of course today I won $25 on wild wins wednesday. I tried to pick up an order for Outdoor Adventures yesterday at a Kmart 25 minutes away but they'd picked a completely different set off the shelf instead and didn't have any of the new sets on the shelf yet, thus the ship to Sears option, where the pickup experience is much easier.

[Phil B]

Saw the ominous news and decided not to hesitate and used about $70 in points along with $10 in surprise points to get Outdoor Adventures people pack, Sweet Surprises, and the Arctic exploration team for ship to store pickup at my local Sears. Of course today I won $25 on wild wins wednesday. I tried to pick up an order for Outdoor Adventures yesterday at a Kmart 25 minutes away but they'd picked a completely different set off the shelf instead and didn't have any of the new sets on the shelf yet, thus the ship to Sears option, where the pickup experience is much easier.

Ship to store has always been good quality merchandise for me. Ship to home is spotty at best. Of my current go-to set I received several top-grade copies at first, all shipped to my home address, properly packed in boxes. Lately it has been mainly plastic wrap and squashed boxes, even if shipped in a cardboard box and not in plastic. Trying to do exchanges now in store as I don't want to risk a full-out bankruptcy in the middle of an online return.

[Phil B]

More store closings, including 2 of my nearest 3 Sears (my closest closed in the spring already) ... https://searsholdings.com/docs/082118-store_closing_list.pdf

[Phil B]

Q2 earnings call postponed until 4:40pm today. Many take this as a sign bankruptcy will be announced. Curious what that will mean for our points - immediate shutdown or will there be a phase-out like w TRU....

[keymomachine]

30 minutes ago, Phil B said:

Q2 earnings call postponed until 4:40pm today. Many take this as a sign bankruptcy will be announced. Curious what that will mean for our points - immediate shutdown or will there be a phase-out like w TRU....

And here I've got a couple orders in friggin limbo