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I don’t know how Sears failed so hard. I worked for them as a frontline sales rep at the turn of the century. I’d love to hear a story from the bigwigs. The P
by mulmen 5y ago
I don’t know how Sears failed so hard. I worked for them as a frontline sales rep at the turn of the century. I’d love to hear a story from the bigwigs.
The POS system was archaic, even at that time. Nobody trusted inventory counts, it was never accurate. But the website was always worse. Plus we had no workable access to it. It took an eternity to load a page. And what you saw was worthless. Sears treated the website with contempt.
We had a mandatory company wide meeting on a Sunday night. They played a pre recorded message from the CEO telling us how important family was to the company. He was at home with his family. We weren’t. That never registered with Sears.
My job at the time was ostensibly to sell hand tools, or lawn tools, or consumer electronics. But that wasn’t the point at all. We got paid commission. The item was nothing. Maybe 3%, probably less. A few dollars. But a successful Sears card signup? That was a flat $20.00 payout. Add on a warranty? 30% commission on the warranty. Bonuses were paid to management based on the ratio of sales with addons. So for a sales rep like me we will take any sale. But my boss would prefer I not sell a TV at all if I don’t get the warranty.
Sears was a predatory business for decades. I don’t know when they lost their way but it was long before the turn of the century. Modern business would do well to study how Sears failed.
- mjevans 5y agoMy TLDR opinion: The MBAs squeezed all the value out for shareholders and short term profits once again. Cut every cost to the bone, sell everything not bolted down until the end. It only took as long as it did for Sears because of brand and brick and mortar inertia. ----- Inventory counts: have to do 'inventory' (check what's really there), which costs workers and time to verify. Most frequently seen by consumers when a store thinks they have X of something but they really have N (likely zero). POS: Infrastructure is a cost center... How do you measure the hypothetical losses? Saturday... video message? WTF kind of cult is this BS? Maligned incentives. I'm sure ages ago those metrics used to be useful for promotion or something, then they became the literal payment system. No wonder that place felt like a used car showroom for merchandise as they were going out of business.
- madaxe_again 5y agoGo a layer deeper, and it’s simple psychology. By the time sears entered their decline, everyone working there was not only born after the founding of sears, but their parents were, and likely their parents too. Sears was a fixture, an eternal company, “too big to fail” - reified. That attitude is, again and again, the crux of the failure of long-lived organisations and institutions of every flavour from private companies to dynastic families to nation states.
- mulmen 5y ago> Saturday... video message? WTF kind of cult is this BS? Sunday. The store closed an hour or two early on Sundays. They had the whole staff come in at 7pm, even if it was our day off. It was around the time of the Kmart merger so could have been about that. The only thing I recall now was the CEO telling us how important "family" time was, while my dinner got cold at home. Of course "Sears is a family" or somesuch. So yeah, a cult, at least in the c-suite.
- justsomehnguy 5y agoA guy says: > I don’t know how Sears failed so hard and proceeds to describe exactly why it failed so hard. BTW, despite all that corporate bullshit one thing should work reliably: inventory. When a customer is physically in the store you can "sorry, actually we don't have $thing in stock" all you want, they can't just teleport to your competitor. In the Internet - they can.
- yjftsjthsd-h 5y agoI was going to comment the same, but I think the question was one layer up from that: Yes, they failed because of terrible tooling, tone-deaf management, and awful incentives. But why were those problems happening? The tooling problem should have been obvious to anyone even passingly involved with on-the-ground operations (and lower managers should have bubbled that up), management should have seen how they looked, the incentives should have been so obviously cancerous that they should never have been let out the door. So why did the company behave in ways that appear to have been dumb even at the time?
- BizarroLand 5y agoSears was "too big to fail", an "American Institution", Sears catalogs were used as toilet paper in the old west (once you had bought your year's supply of ammunition, a new home to build, canning supplies and seeds). It may have felt like they could do no wrong so why focus on continuing to do right? Why push for excellence when you're already the best? And once one manager started thinking like that, then another did, and another did, and another... It's easy to see in the aftermath what factors caused them to fail, but the spirit of the event itself was plain to everyone not caught up in it. They thought they were invulnerable, and like a teenager wearing a t-shirt on a motorcycle they eventually found out the hard truth.
- bluedino 5y agoSounds like standard retail in the 90's. The place I worked at had percentages you needed to meet for service plans and accessories. We were told to push 4 ink cartridges and photo and regular paper with every printer. Don't forget your gold plated parallel cable! The biggest sellers got promoted to department leads and then assistant store manager. Amazon isn't anything different. You're bombarded with offers to sign up for the Amazon Visa, "Get $50 off with approval of the Amazon Rewards Visa". They try to sneak in the Asurion warranty. 'Customers who bought this item also bought...' is where they push the high-margin accessories. They don't make any money on the big items. Nobody ever did. It's the service an accessories.