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Sears' Biggest Problem May Be Its Service

February 08, 1991|S. J. DIAMOND

For a decade, we've heard only of trouble at Sears, Roebuck & Co., the nation's largest retailer, indeed its quintessential store. Its sales and profits have slipped, its stock price and bond rating fallen. It has restructured and refinanced, sold off divisions, closed distribution centers and departments, and some analysts think that it may shut down its catalogue operations.

Staff has been cut periodically, and Sears is now laying off another 21,000--supposedly in non-selling store positions. Salespeople are already in very short supply.

Retail analysts talk of new competition, management rigidity and merchandising mix in explaining why the big retailer "lost its franchise" with consumers. One could also ask consumers; many who used to shop Sears regularly don't anymore, and they don't mention management and merchandise mix. They talk of service.

"It's like a store in Russia," says one Santa Monica shopper. "The people are unhelpful, the stock's not there and you have to wait in line forever to pay."

Significantly, everyone has a Sears story, a classic tale of retail insult. In Los Angeles, Roslyn Blackman brought back her son's new tool chest because the inside had apparently been badly damaged and just retaped, and had to fight the salesman, "who kept saying, 'How do we know it was damaged at the store?' " Public relations consultant Nat Read, a former Sears executive, bought a washer and dryer, free delivery included. The washer was the wrong model and had to be sent back, and he was charged for the second delivery on the grounds that only one delivery is free.

Some of Sears's problems came from outside. Sears traditionally offered one-stop shopping--everything from socks to refrigerators, good quality, good prices. But today's malls made one-store, one-stop shopping unnecessary. And today's discounters and big specialty stores (for appliances, electronics, toys, hardware, even fashion) leave Sears behind on price and selection.

Along with cutting costs to match slipping sales, Sears "has been struggling," says Leonard Berry, director of Texas A&M's Center for Retailing Studies, "to find a strategy to regain the momentum it had 20 years ago." But real change comes hard to a massive organization with more than $30 billion in sales and more than 850 full stores nationwide. It may lose some bulk, but it's still a dinosaur, its brain so far from its moving parts that it's slow to react or shift direction.

There has nevertheless been a virtual flurry of activity in the retail store. Sears kept tinkering with the "merchandise mix," moving into fashion with a Cheryl Tiegs line, carrying fewer private labels and more national names. It established "power formats"--stores within the store, specializing in electronics and appliances (Brand Central) and children's clothing (Kids and More).

It tinkered with pricing, announcing that "everyday low pricing" would replace its emphasis on sales and specials. The public misunderstood this (said Sears), assuming that prices would move downward. In fact (said New York's attorney general, among others), many prices moved up--to somewhere between the "sale" price at which they regularly sold and the "regular" price at which they almost never sold. Stable prices (said Sears) would also free salespeople to serve customers, instead of constantly changing price tags.

But such statements were not followed by any announced programs to improve service--perhaps the only merchandising trick Sears hasn't tried. Not one of a dozen consumers queried liked the service.

It's partly a matter of numbers. A Colorado woman calls Sears "low on clerks." Says Judy Marriner in Massachusetts, who visits Sears now only for batteries and tires: "You don't get any service. They just have cashiers now."

It's also a matter of attitude. A recent visitor to the Santa Monica Sears (which seeks comments on its service via "We Care" forms placed around the store) found that most departments had no salespeople, that the salespeople present didn't leave their counters and that three in four were neither knowledgeable nor communicative. One even refused to sell two flashlights for the $3.88 they were marked, because the cash register showed the price as $3.99. He told the customer to go check the price on the shelf, then gave up the sale rather than the 22 cents.

He was wrong, his supervisor later said. "Next time, you ask for the manager."

Baloney, says Read, who "had to go to the store manager on each of my last three purchases. The system is supposed to work so you can buy something without going through the store manager."

Such complaints about Sears' service may say more about its troubles than anything else. It's easy to change goods and prices but hard to change the nature of the beast, particularly such a big one. Size alone may keep it around awhile, but once the climate changes, perhaps no strategy can halt its decline.

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