Sears has filed for Chapter 11, declaring bankruptcy.
From US Courts.gov, Chapter 11 bankruptcy typically involves a debtor proposing a plan of reorganization to keep its business alive and pay creditors over time.
Also, in a chapter 11 case, a liquidating plan is permissible.
It is reported that at least 142 more stores will be closed by the end of the year, in addition to previously planned closures.
Retailers filing for Chapter 11 bankruptcy often do so with the intention of turning things around to become profitable again. Sometimes it works out, other times it doesn’t.
But what does this mean?
Time will tell.
With respect to tools, the Craftsman brand lives on, under Stanley Black & Decker ownership. Several years ago Sears got rid of most if not all of the Craftsman tools I could have recommended, and they also stopped carrying other brands unique to their catalog.
Their “Shop Your Way” internet marketplace service is somewhat detached, and will likely live on, past any eventuality that affects Sears retail stores. That might even be a way for Sears’ website to be kept alive.
Tens of thousands of jobs are in jeopardy if Sears can’t turn things around.
What brought Sears to this point? In my opinion, stagnancy but also bad choices. The tool department went through changes in recent years, and were far worse off for it. I’d guess that the same could be said about other departments.
It’s a sad day when I think about all of the people who might lose their jobs. But Sears? Unlike the demise of Toys R Us, which still stings every time we drive by, especially when my son says “they took the letters down,” I won’t shed any tears for Sears. They made sure of this, with all of the bad changes they’ve made in recent years, to their former Craftsman brand as well as their “Blue Tool Crew” catalog of other brands.
Sears destroyed themselves.
What remains to be seen is whether or not they can climb out of this and exist in any capacity.