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Sears Canada is gearing up to close another round of stores, according to the Globe and Mail. The move by the company appears to be following in the footsteps of Target Canada, which shuttered its operations in the country last spring.
According to the Globe and Mail, Sears has instructed real estate firm CBRE to look for alternative uses for Sears’ weakest stores, such as its clearance outlets, says Brandon Stranzl, executive chairman of Sears Canada in an interview.
The big-box retailer is looking for any and every opportunity to cut costs and revive its core full-line department-store business as it struggles with tumbling sales, the article adds.
“We’ve got this network, we’re going to rationalize and we’re going to figure out which stores make the most sense,” says Stranzl. “We’ve got a higher level of acuity today than in the past few years” in looking to drop sites.
As the retailer searches for ways to raise funds and scale back on real estate, retail landlords are struggling with the growing number of vacancies, like the many empty Target Corp. chains.
Currently, Sears Canada has about 10 outlet stores, 40 home stores and 95 traditional full-line department stores, according to the article.
While Sears’ previous shutdowns came with landlords offering buy back opportunities for the retailer’s store leases with other retailers, this time, “amid the rash of retailers such as Target that have closed stores, landlords no longer have compelling new retailers to fill so much space.”
Despite the company searching for ways to downsize, Stranzl says Sears is determined to turn around its core business and remain in many locations, although some may be downsized or closed when the lease expires. To build back customers, the company wants to lure young consumers with new styles and improved store layouts.
The article adds that while the company is looking for ways to shutter locations, there has been “no final decision on the extent of closing.”
After a short two-year stint, Target Canada closed its doors, costing its parent company billions of dollars and putting roughly 17,600 people out of work, according to Canadian Business.
