Business

Critics say Sears CEO aims for liquidation

Just call him Eddie “The Liquidator” Lampert.

The hedge-fund tycoon insisted Thursday that he’s bent on a “transformation” of Sears Holdings as its chairman and CEO, envisioning a high-tech retailer that more deftly serves its shoppers.

“We are proactively transforming our business to a member-centric integrated retailer,” he said, as Sears’s third-quarter loss widened to $534 million on a 6.6-percent sales drop.

Critics say these strategies are gimmicks to mask Lampert’s plan to milk the company’s cash for as long as he can before finally liquidating the chain.

Sears also said it’s still looking to sell stores and spin off assets including Lands’ End and its Auto Centers to shore up fast-dwindling cash reserves.

“Sears is going the way of the Titanic, and Eddie is busy selling off the deck chairs,” said Robin Lewis, CEO and managing editor of the Robin Report.

Lampert said Thursday he was shifting Sears away from “running a store network” to focus on digital initiatives. But the tiny size of Sears’ e-commerce unit makes talk of such a broad strategy ludicrous, Lewis said.

Sears said online and multichannel sales have risen 17 percent year to date, but it didn’t give dollar figures, while the e-commerce business still amounts to less than 3 percent of the whole.

“He’s certainly not going to get into the running in e-commerce,” Lewis said, noting the growing dominance of Amazon.

Lampert’s other major talking point in recent quarters, a customer-loyalty program called “Shop Your Way,” has likewise failed to prop up either sales or margins, Barclays said in a research note.

The bank noted that sales of appliances at Sears, which once dominated the category, continued to drop in the third quarter, even as Best Buy’s rebounded by 25 percent.

“We think Sears’ issues stem from poor customer loyalty that does not drive incremental purchases, which leaves the program as a hindrance to margins without the pickup in sales,” Barclays said.