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orgtheory puzzle: why does sears still exist?

Puzzle for you all your org behavior/theory of the firm types: Why does Sears still exist? Normally, when we think about why successful firms exist, we think that they have a unique product, fill a niche, or have some sort of incumbent advantage. Or just overly aggressive management. But in a world of Amazon, Target, and Home Depot, it’s difficult to understand what Sears does well. Why aren’t they gobbled up by Lowes or Home Depot? Or dismembered by selling off its prime real estate holdings?

You see the occasional article on the topic. Forbes in 2011 claimed that it was generating good cash flow, which owners used to fund purchases of other firms. But the question is – where is the cash flow coming from? Yahoo readers claim that Sears is less a retailer and more of a holding company for a few brands (like Diehard batteries or Land’s End clothes) that just happen to be sold in Sears big box stores. But you’d think that competition would make this set up hard to sustain. The Forbes article does note a massive drop in sales… yet wiki reports that 793 (!) stores were open in 2014. Please use the comments.

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Written by fabiorojas

March 25, 2015 at 12:01 am

3 Responses

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  1. Craftsman tools.

    Like

    sherkat

    March 25, 2015 at 12:32 am

  2. For the same reasons that Canadian Tire remains a retailing icon, eh?

    Like

    Randy

    March 25, 2015 at 1:18 am

  3. CKD

    March 28, 2015 at 1:33 am


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