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Dear Mr. Lampert, Sell Lands’ End

01/09/2013

A open letter to Mr. Edward Lampert, Chairman and CEO of Sears Holding Company.

Dear Mr. Lampert,

Sell Lands’ End.

Sincerely ,

Rick Rusch

lands_end_2-1Lampert’s selection of himself as the ailing retailer’s fifth chief executive officer in seven years shows the billionaire hedge-fund manager hasn’t taken his critics to heart.  Ever since he’s controlled the company, Lampert has avoided putting a seasoned retail executive in charge of the department store chain. Instead, he’s handed the reins to executives from the supermarket, restaurant and telecommunications industries, and now himself.

Lampert appears to dislike or not trust merchants to run his companies.

Sears has been suffering years of declining sales. The company forecast that its net loss for the current quarter will be between $280 million and $360 million, or a loss of $2.64 to $3.40 a share.

Analysts have predicted that unless drastic changes are made to its stores and merchandise, the company will slide to its demise. Sears has been selling some assets, including stores, after it posted a $3.1-billion loss in fiscal 2011.

Which is an unsustainable loss, unless supported by the US government which is the case for the roughly $13 billion dollar loss suffered by the US Postal Service in 2011.

Sears, in an attempt to revive itself, has been trying to overhaul some of its stores and add technology, including equipping sales clerks with mobile devices to aid shoppers. But who wants a salesperson with a tablet to help you find bad product faster?

Now is the perfect time to divest Lands’ End. As its sales are rolled into the overall SHC figures it is difficult to identify Lands’ End’s total sales and profit margins but it is safe to say that sales are around $billion and that it operates profitably.

Reviving the Lands’ End brand will take some heavy lifting. Since the acquisition by Sears, Lands’ End has slid slowly into obscurity. But Lands’ End’s dormancy is better than decline like Sears or Best Buy. Most consumers have simply forgotten about Lands’ End while many have never heard of it.

Once freed of SHC and with the right team of merchants and marketers Lands’ End is capable of great things. It has a core of smart, talented staff that have stabilized the company during the tumult brought on by Sears.

So, Mr. Lampert…it’s time to make a deal.

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2 Comments leave one →
  1. timmyherrig permalink
    01/10/2013 7:14 pm

    Amen Rick.

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