Sears Tries To Cut Its Way To Profitability

May 18, 2004
George Anderson

By George Anderson

The chairman and chief executive officer of Sears, Alan Lacy, has sent an email to headquarters personnel advising them to find ways to reduce expenses as the company continues to experience declining sales.

According to Crain’s Chicago Business, Mr. Lacy wrote an online memo that said, “Making the day, the week, the month and the year are critical for us, particularly in light of our recent disappointing results in apparel and other businesses.”

Mr. Lacy pointed out that the goal was to limit discretionary spending and an ordinary “spending adjustment in response to our recent performance.”

Moderator’s Comment: Is Alan Lacy’s call for a reduction in discretionary spending more a case of a prudent move based
on current business or an indication of larger problems at Sears?

According to Crain’s, Sears saw same-store sales increase in January and February and flatten out in March. The retailer’s sales in April were off 1.8 percent
during a month when many others posted numbers that were lower than expected.

George Anderson – Moderator

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