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Tags: sears | kmart | retail

Fewer Sears, Kmart Stores Reflect Changing Tide of Retail

By    |   Wednesday, 04 January 2012 11:03 AM

Sears and Kmart are victims of changing consumer habits and the trend in their sales will be difficult to reverse.

The latest data from the Census Bureau confirm that department stores are no longer retail hot spots. Sales at department stores declined from a year ago while sales at every other category of retailer climbed.

Department stores were once the kings of retail. One hundred years ago, on Dec. 30, 1911, President William H. Taft gave a speech at the grand opening of the new 45-acre Wanamaker’s department store in downtown Philadelphia. Today’s largest mall, the King of Prussia Mall, offers shoppers 65 acres of retail space.

According to a recent story by Bloomberg, Taft noted at the Wanamaker’s opening that: “We are here to celebrate the completion, in its highest type, of one of the most important instrumentalities in modern life for the promotion of comfort among people. The department store…”

Department stores are no longer among the most important parts of modern life. Instead of celebrating store openings, analysts and shoppers spent Dec. 30, 2011, reviewing the list of Sears and Kmart stores that would be closing.

Non-store retailers, mail order catalogs and internet sites, saw the strongest year-over-year growth. They have proven to be tough competition for full-priced department stores and consumers are likely to be adapting to even more changes in the future.

Wanamaker’s opened before suburban malls took sales away from downtown merchants. As President Taft praised the department store, the discount store was already rising as a competitor. Kmart, then operating as S. S. Kresge, had 85 stores open for business as the dignitaries gathered in Philadelphia.

Store closings may be painful, but the economy will continue to select winners and losers based on technology and consumer tastes. Government bailouts could postpone the inevitable, but consumers now prefer other shopping venues to department stores. The economy is most likely strengthened by the painful choices executives at Sears Holdings are making.

© 2022 Newsmax Finance. All rights reserved.

Wednesday, 04 January 2012 11:03 AM
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