A lot has been written lately about the designs Sears Holding
Fellow Fool David Meier thinks Lampert has the tools to change Sears. The decision to expand Craftsman tools to Kmart stores, for example, is generally seen as a positive development designed to actually expand shareholder value, rather than simply wringing as much cash as possible from the company's real estate.
Yet as someone who has written a word or two on the Sears saga over the past year or so, I'm not convinced that the company is a good investment based on the retail story, whatever else it may hold as a leverage vehicle for Lampert's other designs.
As a new homeowner hard at work restoring my chateau, I've been purchasing tools, appliances, fixtures, and furnishings at all the major retailers. As much as I dislike the experience of shopping at The Big Orange Apron, its big blue counterpart Lowe's
That's why I have trouble reconciling Sears as a successful retailer, and a supposed discount one at that. From back in the days when my Dad exclusively bought Craftsman hand tools, they have carried a premium to those you can get elsewhere -- not just in hand tools, but also power tools. As a weekend woodworking hobbyist, I like quality tools, but they don't have to be professional-grade. There's a bit of price sensitivity here, and while Craftsman tools are indeed good, I don't think they're good enough to justify their premium prices.
Craftsman hand tools compete against Husky, MAC, Proto, Kobalt, Stanley
In power tools, the Craftsman brand competes against Home Depot's Rigid line -- made by Emerson (interestingly, Rigid also makes some Craftsman tools) -- as well as the name brands like Delta, Porter-Cable, Oldham, DeVilbiss, and others. Again, most consumers probably don't realize that all of those names are now owned by Black & Decker
And it's not just the Craftsman brand. Many products sold in Sears have much higher price points than elsewhere. Home Depot sells a one-gallon bucket of acrylic tile mastic for about $11; Sears has the exact same brand selling for $20. Name-brand appliances can run upwards of several hundred dollars higher at Sears, for identical products. As much as I like the convenience of my local Sears store, Home Depot isn't that much further, and Lowe's is only a little beyond that.
Still, I find myself turning to my local hardware store even more these days, precisely because of those bad shopping experiences at the big-box stores. Yes, prices are generally a little higher, as they are at Sears, but the service you get there is unparalleled, and they sometimes have items in stock that would be a special order elsewhere. I was able to pick up a pallet of cultured stone for my breakfast nook at the hardware store that I couldn't conveniently get anywhere else.
Maybe as I get older and more crotchety, I'm placing more importance on superior service than a low price. Home Depot and Lowe's may have a lock on price, but they can't touch service. Sears and Kmart seem to have neither. For my money, that's a long-term death knell for any retailer, and certainly not worth a premium price tag. It's said that to a man with a hammer, everything looks like a nail. If that were true for Sears, I wouldn't be driving this nail home.
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